"Must Knows" about Budgeting

Do you have a list of everything you make and every thing you spend each month? You should.

What are your money goals? If you want to pay off debt and save more, then you have a goal!

First, you need a list of money coming in each month and money going out each month. That means going into each of your accounts and recording everything the regularly recurs each month, or each quarter, or every year. 

Second, you need to see how your budget works each month for each of your bank accounts like checking and savings. If today is the 1st of the month, then how does your Running Balance look at the end the month? Will you overdraw? Will you have too much left over that should be savings? How will you know?

Third, you need to reconcile your budget items when the actual item comes through the bank. Is your budget for internet $100 a month? How about that credit card? Is it $300 a month? What actually came through? Was internet more like $93.45? And maybe you only paid $200 on that credit card. You need to reconcile that with your budget so you Running Balance is accurate. Otherwise, you risk overdrawing your accounts. 

Bonus Tip! Don't worry about grocery budgets or dinning out budgets or clothes budgets, etc. Just use ONE credit card for all those highly variable, discretionary activities and never go over that. Set $2000 a month, for example, to pay that one credit card and then go enjoy your month on those discretionary activities. Just don't spend more than that $2000!