Create your Money Management Plan so you are able to live within your means! Our free budgeting advice can help you manage your money very well.
When you create a living money management plan, you acknowledge that changes occur in everyday life including emergencies, unforeseen expenses, lost income and a lot more finance busters.
Create Your Living Money Management Plan
You need to create an outline of what you owe, what you own, and what money you have coming in. This will start the preparation of your initial plan.
You should use a money management system that works for you, that you can live with, not just any system out there. If the first one you try works well, but you don’t like it, or hate working on it … you won’t stay on it.
Track Your Spending
Most people don’t realize how they really spend their money. You think it goes to debt, or the house. You may think you spend X amount on groceries, but, in reality, you may find it’s double!
You need to see where you are really spending your money. You need to track it, record it, and then make adjustments to your spending, in order to make educated decisions about how you want to spend your money.
Keep a record of everything you spend. It doesn’t matter how you paid for it, just track all spending. After you see where your spending is, then, and only then, can you take the steps needed to prepare a money management plan that you can live with. This vital step will be one of the best ways to understanding why you are in debt and how to get out of it.
Money Management Means … Adjust Adjust Adjust
Money management is the process where you create a basic budget, set up your goals and then adjust to meet current life circumstances. Keep your plan flexible by reviewing it regularly. Life always offers the unexpected and your Living Money Management Plan needs to take that into account too.
Your money management plan should become a living, breathing thing because you will get to know it intimately. Review it, adjust it, live by it, then review, adjust and live again! You are a flexible, living human being, so your plan needs to be flexible enough to keep up with you.
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Try our free household budgeting form or these other software options we recommend:
YNAB budgeting software can help you track your spending and make better decisions so you can get out of debt. Easy to use software with a free trial.
For Iphone and Android
Vertex offers a variety of budgeting and money management spreadsheets, some free, some for a nominal fee. Check them out to see if they have something that works for you.
Posted by: Billie (TX)How best to budget to pay off credit card and loan payments?
Review our tips for reducing debt and then look over your obligations. What is the highest interest rate? Paying down higher interest rate debt does more for you since you pay less interest. Ideally that would mean you have more, over time, you can put onto other debt.
What has the lowest balance? If you need to see quick results, focusing on the debt with the lowest balances means you will see MEASURABLE results more quickly … you will have a fewer number of debts to pay.
I prefer the “hit the highest interest rate debt first” way, but you may feel more comfortable with the “lowest balance” way.
And, to make it even more confusing … what about the “secured” debt way? If you pay off secured debt first, your secured assets are truly yours more quickly. Unsecured debt gets paid, but not with the focus that secured debt has. However, in a lot of cases, secured debt has lower interest rates and much higher balances. You have to be really patient for this method of debt paydown. And it can actually cost you more since the interest rates are lower for what you are paying off, and your unsecured debt is just accumulating higher interest charges.
Posted by DebtSteps Admin