HOW TO SET UP YOUR PLAN
HOW TO SET UP YOUR PLAN
Money management should be a joint family effort. Every one old enough to spend money should be involved in the basic decisions of how the money will be spent. Who will do the bill paying, and who will keep the records. this is a good time to discuss personal allowances and other individual expenses. Let all family members participate, and they will be more inclined to cooperate.
You know that certain expenses are essential and others optional. You also know that some of your income should be set aside for savings. With this in mind, establish some priorities.
Set up a reserve fund for those once- or twice-a-year expenses so that you can budget for them throughout the year. For example, if you make two $300 life insurance payments each year, you should set aside $50 a month for insurance in your reserve fund.
Use the budget worksheet as a guide in setting up your budget. You know that by spending according to the amounts you’ve established, your money will go where you want it to go.
WHEN ALL DOESN’T GO ACCORDING TO PLAN
Don’t be surprised if your budget doesn’t work out perfectly all of the time. Expect the unexpected. Maybe this is the year you’ll be hit with an unusually large dental expense. Or next month an unexpected auto repair bill. Don’t let these emergencies shake your faith in your spending plan. Here’s where your savings can come to the rescue. Or, perhaps you’ll have a readjust your budget for the future. Maybe you’ll have to cut down on entertainment for awhile to spend more on something more essential. These adjustments are perfectly normal and should be expected. Make the adjustment and continue on from there. But stick to some kind of plan.