Monthly Money Management and Budgeting Tips

Regardless of your income level and how often you get paid, it is a sound idea to keep a monthly budget. Most bills are monthly expenses, after all. Keeping a monthly budget will allow you to be able to use your money more responsibly because you will have the opportunity to see and plan for your expenses from a longer-term perspective than a weekly or biweekly budget may allow.

Choose a Method

Plenty of methods are available to create a monthly budget, ranging from practically free to very pricey. Any method you choose will only be as good as you are about using it. Select a method that matches your preferences and lifestyle. Do not buy a fancy budget book--graph paper and a binder will do. Alternatively, use Microsoft Excel or Apple's Numbers to keep your grid. Draw or insert calendar pages to aid you.

Determine Your Bottom-line Expenses

Map out your bills to determine if your incoming funds can adequately cover them. Write down each bill for the month in chronological order. This does not yet include food or other necessary but nebulous expenses. Highlight the bills that are necessities. For example, the rent or mortgage, utilities and student loan payments are necessities. The gym membership and the cable payment are probably not necessities, regardless of how painful they might be to lose. Next, include food, sundry household necessities (such as laundry detergent or toilet paper) and gas expenses. Be honest with yourself about how much you spend. Figure these in as weekly expenses.

Allocate the Funds

Write down the incoming funds you will receive during the course of a month and when you will receive them. If variables occur, err on a conservative estimate. Can you cover your bills and basic expenses? Will you have enough money in your bank account at any given time during the month, or do your pay days not quite work for the bills? If you have problems, it is time to cut back. Take a hard look at the bills that aren't highlighted and at your expenses. Are there any that you can do without? Eliminate items until you are spending no more than 90 percent of what you earn so that you can save. Make sure to also budget in personal expenses and little splurges for yourself. It will help you stay in line with your budget long term and resist temptations that you cannot afford.


Source: eHow