Article 123 Financial Tune-Up - Part 4 Working on the Budget Spreadsheet
Financial tune-up will work out if there is some kind of budget which we have already covered. Some were able to work out their budget with the help of the spreadsheet but others did not so I will give you another way of doing the budget right here, right now.
The first one is Mortgage or rent. Go ahead and write the monthly amount you pay for it. Then do the same for: gas bill, phone bill, Internet, cable bill, home insurance, car payment, car insurance, health insurance, electric bill, credit card payments and cash withdrawn. Then there are two items called Other for the expenses that do not fit in the list. Anytime you do not have an expense for, just enter zero (0).
Then those that are not monthly expenses for which you can anticipate spending money like Christmas and birthday gifts, IRA contributions, repairs or replacements like a stove for instance will have to be entered as well. Just like on the regular monthly payments, anywhere where you do not have a figure for, enter zero (0). The spreadsheet will automatically calculate monthly expenses for you.
Then enter your income for the year including the salary, interest income, bonus and investment income. The calculator will calculate the monthly income. Enter the yearly income in the fields below. Anywhere where you do not have a figure for, enter zero (0). Now click submit. The next page will summarize your monthly income and expenses.
It will be something like this:
| Monthly Expenses | $2484 | |
| Average Monthly Expenses | $50 | |
| Monthly Income | $2233 | |
| Monthly Budget Summary | -$301 |
A lot of us do not know how much we owe from month to month unless we do a budget and stick to it the best way we can. From above, you can see there is a monthly shortfall of $301. Each time that Monthly Budget Summary number is negative means we are spending more than we earn.
Due to that shortfall, we have to find something among our expenses to reduce to get rid of that negative result. How do we do that? We have to print the numbers we entered and examine them carefully with a fine toothed comb. Which item can we cut? While we are doing this, we might as well see if we can give ourselves a 10% increase by cutting our expenses by 10%.
Clearly, we are still on the first step, but we cannot really go ahead without completing this stage for the only way we can have a brighter financial health is if income that comes in is the same or more than the expenses which is the money that goes.
It does not really involve that much of a sacrifice; we just have to use our God-given talent and use that grey cell to our advantage. For example where I live, there is an entertainment complex called Ontario Place that will give free entrance for the whole year. You can really have lots of fun there without breaking your budget. So now hopefully, we can move out of this stage in doing our financial tune-up.
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Article 125 Financial Tune-Up - Part 5 Build an Emergency Fund As Fast As Possible
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