Attaining and maintaining financial strength and stability begins with a complete understanding of your income and expenses. The easiest way to achieve that is by creating a budget. A budget will help you increase your cash flow, reduce or eliminate your debt, create/maintain a savings plan and set a timeframe for achieving your financial goals.

Creating a budget is easy. Sticking to it is another matter. So be realistic when establishing your budget and be sure to include the entire family in the process so everyone is on board. As you set up short- and long-term goals, also set up incentives for meeting those goals. Sticking to a budget is easier when a reward is in sight.

Get Started

To develop a smart and accurate budget, you need to identify all your numbers. Specifically:

• Gather all your checks, pay stubs, bills and receipts for the last month and separate them by income and expense.
  • Determine your income from all sources
  • Determine all expenses that occur each month
  • Identify variable expenses that may or may not occur monthly.

 Making smart choices

Meeting your financial goals requires you to make daily smart choices that support your long-term purpose. Begin by defining what expenses are necessities and which are luxuries. Be honest! If you are unable to meet your needs, you must first cut your expenses. If you are still unable to meet your needs, you must increase your income. A few other tips to help with meeting your daily budget:

• Reduce costs by eating or dining at home.
• Check out sales flyers and cut coupons before going shopping.
• Make a list and buy only what’s on the list. Avoid impulse buying.
• Avoid vending machines for small snacks, and buy in bulk at a reduced cost.
• Budget entertainment and activities wisely.
• Document and keep records of all your income and expenses so you know where your money is going.
• Start an Emergency fund by initially saving small amounts. Just a few dollars can add up over time and keep you in budget when unexpected expenses occur.