Creating a Budget PlanPosted on August 9th, 2010 | admin
Tips For Creating a Budget Plan
In an age where consumer spending is high and there’s a constant flux of new products on the market, knowing how to budget properly is the key to financial stability. Set long-term financial goals and implement short-term strategies to put you back in control of your wallet. If you’re budgeting for an event, the basic concepts still apply.
Steps to budgeting properly
Create a personal spending plan
1 Learn how and where you spend your money. Stopping for a beer after work and renting a couple of movies on a Friday night doesn’t seem like much, but every expense adds up. Get a small notebook and write down every penny you spend for a few weeks, to start seeing your spending patterns and what your expenses actually are (rather than what you think they are).
2 Create an ongoing spreadsheet listing what you spend, where and when. This will help you track patterns and inconsistencies.
3 Rank your spending priorities from the essentials (food, utilities, mortgage payments, medical costs) to the nice-to-haves (home improvement, vacations) and the luxuries (new car, high-end gadgets, designer clothes). Use what you learned from tracking your expenses to prioritize your spending.
4 Factor fixed expenses into your budget, such as your mortgage, tuition or car payment, food costs and tuba lessons. Include annual expenses such as insurance payments and taxes.
5 Pay fixed expenses and bills first and live on what’s left. Save up for what you want rather than buying it and then paying it back-with interest.
Budget for an event
1 Get an estimated head count of attendees and determine how much money you have available to spend.
2 Split the event into components (food, alcohol, entertainment, security, decorations) and prioritize them. Call around and get a range of options and prices for each component.
3 Compare those prices with what you have to spend: If there’s a big discrepancy, start slashing low-priority items. Make a cake instead of buying one; hire a DJ rather than a band.
4 Continue paring back until your expenses equal your budget. If you simply can’t reconcile the two, make additional cuts or increase the budget and find ways to bring money in.
5 Add money to your kitty by asking for contributions, splitting costs with other people, having volunteers take on critical tasks, or bringing in revenue from outside sources.
Creating a budget really comes down to doing more with less. It is always the first step in coming up with a debt reduction solution that is realistic and one that you can actually work with. Cutting business expenses has to be a on-going process that requires each employees dedication. Look at it this way if you have 10 emplyees and each one of them can come up with a cost saving idea that equals $100 dollars for that particular event, you just reduced you costs by $1000 dollars. Even if you paid them a bonus of $100 dollars you still saved the company a good chunk of change.
Review your credit card statements for hidden service fees that you didn’t expect. Make a list of all fees you are paying on your credit cards and maybe consider applying for a new credit card. To find a money saving credit card offer, read our credit card reviews to seek a card with lower (or no) annual service fee. Consider factors such as the rewards programs, do you actually benefit from the rewards?
Remember that typically rewards cards have a hefty annual fee attached. If you aren’t using the rewards, you can save some money by looking for a lower interest rate credit card to save even more.