Financial Advice: Part 1: Creating a Budget

Parts of the Budget
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Get your month gross.
Take out tithe
take out tax
take out 401K or any other retirement plans
use your net spendable income

1. Housing

- Mortgage
- Homeowner's Insurance
- Gas
- Electric
- Water

* With utilites, get a annual total, and divide by 12

2. Food

- Groceries

* Take 2~4 months worth of weekly purchases, and find monthly average

3. Auto

- Loan payments
- Insurance
- Gas
- Maintenance

4. Insurance

- Include deducted payments from paycheck

5. Debt

6. Entertainment

- Vacations
- Clubs
- Movies
- Eating out
- Games
* Keep track of each category for 2 months

7. Clothing

* Keep track for a year, to get an idea of seasonal spending
* Comb through old receipts

8. Savings

* This should not be the first category to be cut
* Future stability is better than short term relief

9. Medical

- Covers insurance deductibles
- Contact lenses
- Orthodontic work
- Medicine (both prescription and over the counter
- Pet(veterinary/medicine
* Keep track of expenses over the past year

10. Misc

- Daily coffee, newspaper
- Dry cleaning
- Hair cuts
- Manicures
- Allowances
- Gifts
- Magazines
* Keep track of 2 month spending

11. Investments

* Bonus, reward for careful budgeting and spending
- Put all left over money here

12. School/Child

- College savings
- Private school
- Child care while at work