A budget really helps you to get a snap shot of your financial picture. It is intended to show you what your total income is and what expenses you pay throughout the month. When you total the expenses and do the same with income, the income number must be greater than the expenses. If not, you are heading for financial disaster.
Income – what you bring in on a monthly basis. That includes your salary, interest on your accounts, child support, etc. If your income does not take out for income taxes, you must add a line in your budget to cover that expense.
Expenses – are all the money you have going out. Think of it on a daily basis. How often do you reach into your pocket to pay for something? How often do you write a check and to whom? What do you pay every other month (quarterly or every 6 months or annually) that needs to be divided down into a monthly expense.
As you will see on the next page, in preparing a budget, we simplified the process by itemizing some of the most commonly used items for income and expenses. This list is by no means complete, so add items as necessary.
Click "continue" and print the following example. Complete it each month. Make sure you calculate your income and expenses on a monthly basis. Remember that each month some of the expenses may change. At the end of the month, check and see how close you were to your budget.