The information in this post is provided by our partner Accel Financial Counseling. Accel’s counseling services and educational programs are available free to all Consumers members.
Budgeting can be a simple and straightforward process. It can also be a rewarding experience for all family members. But, it takes interest and commitment. Here are seven steps to help you create a successful budget.
1. Discuss Values
Determine what is most important to the people involved in your budget, or spending plan. By understanding these values, you can make decisions that will provide you with the most satisfaction.
2. Set Goals
Begin setting goals by discussing with family members what each one may want to do with their money. An example of a goal might be to save for a child’s education. Have each member list the goal and a deadline. Work on the most important goals first.
Put money aside in your budget for your priority goal. Remember, to achieve your special goal, you must treat the money as a bill to be paid to you.
3. Determine Income
Figure out your net pay, or the money that is left over after deductions. The money that makes up your income can come from sources such as salary, allowances, social security or child support. Do not include overtime pay.
4. Determine Expenses
What are the expenses in your budget? Consider fixed, variable and periodic expenses. Fixed expenses consistently stay the same every month, variable expenses vary from month to month and periodic expenses are not due every month.
5. Create a Plan
Design a spending plan so that your income will allow you and your family to have what you want and need. If you find that your income does not cover your expenses, re-evaluate your plan and decide what categories can be changed.
6. Keep Track of Expenses
Keep a record of expenses to see where your money is being spent. By comparing your estimated expenses with what you are actually spending, you can evaluate whether or not your plan is working.
7. Evaluate Your Plan
Periodically evaluate your spending plan. Is the plan still helping you meet your needs and achieve your goals?
Remember that budgeting is the cornerstone of your family’s financial plan and a guide to help you achieve your goals.
As a member of Consumers Credit Union, you can take advantage of the Accel program, a free financial education and counseling program. Accel counselors are available Monday through Thursday 8 a.m. to 12 a.m. (EST), Friday 8 a.m. to 7 p.m. and Saturday from 9 a.m. to 1 p.m. To use this new service, simply call 1-877-33ACCEL (332-2235) or visit them on the web at www.accelservices.org.