Now that you have your list of weekly, monthly, quarterly and yearly expenses. We need to make some categories. Every expense you have should be in a category. My categories will not be the same as your categories.
But for an example, I have major categories and then sub categories.
Major categories for me are: Giving, Utilities, Savings, Housing, Food, Transportation, Clothing and Personal.
Subcategories aren't in every major category, but almost all of them.
Giving - no subs
Utilities - cell phones, electricity, propane gas, bundle, and trash
Savings - Savings, Emergency Fund, Retirement, Christmas, Camping/Vacation and College
Housing - Real-Estate Insurance, Renter's/Home-owner's insurance, Rent and Replace Furniture
Food - Groceries and Eating out.
Transportation - Gas and Oil, Repairs and Tires, License and Taxes, Car Insurance, Car Replacement
Clothing - Adult, Kids and Laundry
Personal - Life Insurance, Toiletries, School, Piano, Gifts, Miscellaneous, Household, Medical
So the next project is to take your expenses and add them all up for a total for the year, then divide by 12 and you'll know how much you need to save out each month.
Take a look at your income and make sure that your expenses are not greater than your income. Tweak and arrange it so that your money all has a place to go. If you have to tweak your expenses, tighten the belt, then you take a look at your expenses to find a way to do that. Or find a way to earn more for a time.
Dave Ramsey recommends a cash system. I think we may actually try that and see how it works. We do have a credit card which he does not recommend, but we pay it off every month and we pay attention to what we're spending.
One of my goals, which I've been failing at miserably (see yesterday's post) is to check on-line every Thursday and keep track of the amount so it's not a surprise. As I said, I haven't been doing that so, surprise!!!!!! Thankfully, we had our income tax refund to help us pay the bill, but I can't do that in other months. And I wanted that refund to replace several items that need replacing in our house, and for the emergency fund.
I still have some left to work with. But I will withdraw the cash for my accounts. Do you pay attention when you swipe that card to how much you just paid for all that stuff? I sometimes realize how much went out of my account, but when I have to count out the cash or write a check, I always notice. Maybe that's the reasoning.
If your income is not always the same like ours, make sure you allocate your money when you get your check. That way you'll know what you have to spend.
I want to clarify that these are ideas of a way to do things, not the law or the only way that you should do them. Our goal is not to go into debt, and with our growing family, it's difficult to stay within the food budget and clothing budget and a lot of other budgets. :)
Have a great weekend,
Making the most of today,