Your Personal Monthly Budget Toolkit
Getting started – setting up your personal budget toolkit
Getting started and getting organised can be daunting. Making a start to work towards personal financial discipline takes a bold step in the right direction. Getting your personal budget and spending plan in order is the first step in the right direction.
Financial freedom starts with getting the basics right – getting your personal budget right.
It isn’t difficult or time consuming to get the basics together. Here is what you will need;
- budget planner
- your monthly bank statement
- 30 minutes a month
You can set up your own budget planner using Excel or you can download one of our handy monthly budget planners – http://motivatetoday.co.za/ - choose a format or system that works for you.
Tip: When you set up your expenses think of Fixed, Variable and Discretionary. When you begin to ‘shed’ expenses to get your budget to balance you must work backwards to cut. Account for ALL expenses – no matter how arbitrary or trivial – it all adds up. Don’t park anything in the denial space.
Notebook – ‘money diary’
When you are starting out a handy way to get into the financial discipline rhythm is to create a ‘money diary’. Keep a notebook of all your expenditure. Make a few simple columns;
- Expense description
At the end of the month you are going to track each entry back to your initial budget to begin to compare accuracy and identify where there is wastage spend. This will ensure that you accurately account for each bit of expenditure during the course of the month. You will quickly identify negative trends and bad habits.
Keep an envelope in your ‘money diary’. During the month keep all your slips – ATM withdrawals and till slips. Write a short description on each slip which will identify the spend type.
Monthly bank statement
On the last day of the month draw a bank statement for the month that has passed.
30 minutes – directions for use
- At the beginning of the month set up your budget
- During the month record all expenditure in your money diary
- Every week clear out your wallet or purse and deposit the slips into your envelope
- At the end of the month draw a bank statement for the month that was
- Reconcile the entries in your money diary and your slips to your budget that you set at the beginning of the month
- Reconcile your bank statement to your budget. Make sure that all transactions are accounted for
- Outcome – did you achieve your budget? Reset for the coming month.
- Repeat the process
Financial Education is key to Financial Freedom. Keep yourself financially capable and adopt a healthy attitude to your personal money management.Your Personal Monthly Budget Toolkit