Monthly Budgeting for Financial Freedom
If you are reading this, you are most likely searching for a way to have control of your finances. Developing and committing to a monthly budget has always been one of the ideal ways to do this. Having a sound budget is fundamental for managing money, one that has allowed me to survive even on limited funds. One of the most critical things that I do every month is managing my monthly budget, and it has allowed me to systematically meet all expenditures, grow my savings, and eliminate debt.
I usually map out my budget for the upcoming month close to the end of the month. This will prepare me of what’s down the road. It’s not a good idea to develop a budget after getting paid because, too often, that flush feeling of receiving a paycheck results to uneccessary and spontaneous spending before the paycheck ever reaches the bank.
I start my personal budget by listing all the disbursements that must be paid on time like, mortgage repayments, utilities, insurance policy payments and motorcar loans. These are the things I must pay to keep a adequate roof over my head and continue earning money. I like to pad these essentials to create “money back” after paying the bills and, if costs increase unexpectedly, I’m always covered.
Next, my budget is subjected to a list of discretionary things I need to cover but could live without if absolutely unavoidable. An example are monthly savings deposits, credit card repayments and donations. Don’t get me wrong, some of these things are also essential, but in case of emergency they can be omitted. By giving credit card companies the maximum instead of the minimum, I keep my credit score high and my debt low.
My budget will not include the cost of food, clothing, or entertainment. Ultimately, these items get covered by what’s left in the budget. Some months involve lots of beans and rice, slow-cooker meals, free or cheap entertainment, and only one inexpensive piece of clothing . This strategy of managing my monthly budget has worked out very well over the long term as long as I observe it conscientiously.