Budgeting Basics - Intro

Money matters.  When money comes in, we can spend it however seems best at the time, but unless we make a plan ahead of time we'll never be able to accomplish longterm goals with it or make sure that our important priorities are taken care of.

Budgeting is not a mysterious process.  There's no one right way to do it, either.  I am going to describe what I do, simply because it's what I know best and because I think it works or I wouldn't keep doing it.  Mostly I think it's critical to know what comes in and goes out, to plan for future needs, to focus on the most important priorities, and to set reasonable limits.  Then money becomes a tool, not a master.

Step 1 - Income

Step 2 - Deductions

Step 3 - Bills

Step 4 - Other Expenses

Step 5 - Total Expenses

Step 6 - Adjusting

Step 7 - Allocating the Surplus (Margin)

Step 8 - Big Picture

Step 9 - Envelopes