I've been working on this post for I swear, a week. We've just been so busy with holiday stuff, and I'm working on de-cluttering 100 items in 2012. More on that later!
Here's the quick and dirty on budgeting, courtesy of our buddies at About.com. Too lazy to read that? I hear ya. Here is the super easy way to budget.
1. Figure out how much money you bring home after taxes and other deductions (I.E. IRA, insurance, other investment deductions). Basically, your take home pay. Don't forget to include any other sources of income, such as alimony or child support.
2. Make a list of all of your bills. For larger costs or bills that are infrequent (quarterly insurance payments, or annual property tax bills) save a little each month, so when the expense comes, you'll have money set aside. You can put the money in your savings account, or some banks allow you to earmark funds in accounts.
3. Our example below is based on a couple working each working full time jobs, bringing home $65,000 gross. After taxes, IRA contributions, and health insurance deductions, their net is $49,774.00. The line items marked with * are costs that do not occur each month, but are saved for each month. Items marked with # are variable, but it's an average of the cost of the last 12 months.
Expense Monthly Amount/allotment Annual Amount
Rent 1175 14100
Insurance(Car & Renters) 191 2292
AT&T (phone & Net)# 200 2400
Car Payment 339 4068
Gas & Electric# 45 540
Life Insurance* 85 1020
Water# 50 600
Christmas Money 50 600 (This used to be called an Xmas Club)
Groceries# 100 1200
Savings 250 3000
Eating Out# 75 900
Spending Money 200 2400 (That's $100 per person per month)
Clothes* 30 900
Baby# 100 1200
Car Mtx* 30 900
HBA* 20 240
Gas# 300 3600
Disability Ins.* 200 2400
Total for the year 41,040
So that leaves us with leftover money, of course. Leftover money just hangs out in the checking account, and each month, we try to sneak a little more into our savings or money market account or buy a savings bond for our son or niece.
Money from rebates, Endorse.com, click to pay sites, and gift cards earned through mypoints are not included in the budget. They are just great perks.
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