7 Reasons To Say ‘No’ to Credit Cards

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Out of cash? Use a credit card.

Stuck in an emergency? Use a credit card.

Credit cards are perhaps the most eligible competitors for the position of ‘man’s best friends’ after dogs!

Seriously, a credit card is known to be a tool which helps one sail through hardships and emergencies smoothly.

But, what is yet to be pondered upon is that whether this reason is enough for us to adopt and use a credit card extensively?

I know there are numerous other benefits of credit cards as well. Credit cards come up with offers and lucrative deals on hotel and flight bookings, provide incentives such as significant cashbacks and also provide you with credit interest-free for a fixed period of time without any collateral.

Wonderful, I must say!

Also, credit cards lend you the ability to build your credit score.

But have you, at any point of time, considered that if a single credit card has the ability to build your credit score, it also has the ability to destroy it forever?

Apart from this, do you know crores of people around the globe succumb to debt traps because of credit cards every year?

Don’t believe me? Read about an incident that happened in Delhi, India a week ago: Unable to pay credit card bills, man jumps to his death

Why?

Because credit cards follow a basic principle: Spend now and pay later.

This policy of credit cards makes people spend more than what they can really afford. But why would people do that? To maintain their ‘social status’ in society.

Now, another thing most people wonder is that what is the problem in spending now and paying later?

Well, there is nothing really ‘wrong’ in it, well not until you make it a habit.

People usually tend to get stuck in this debt trap when they start spending more than what they can possibly pay later. It takes years and years, even decades, to repay credit card dues.

People often tend to pay the minimum required amount and then take on more and more debt.

I hope I have convinced you enough to not use credit cards! But for a more detailed approach, let’s explore 7 reasons to say no to credit cards in detail:

1.  Credit Card Interest Rates Are Surprisingly High

Credit cards usually have surprisingly high interest rates which start to imply after a certain grace period. People like us are not aware of these interest rates and hence continue borrowing without a pay-back plan.

In fact, interest rates also grow with time and can rise to such a high level that your interest becomes higher than your initial loan amount.

The best way to avoid this kind of a situation is to avoid buying exorbitant things which you can’t otherwise afford with cash.

2. Credit Cards Lead To Overspending

Credit cards have been designed very smartly. Their concept is designed in a way which makes people overspend than their budgets.

This will lead to people paying interest rates and ultimately the credit card companies’ profits!

But why do people overspend?

Well, purchasing an item simply doesn’t appear as huge a deal if you simply need to swipe a plastic card and don’t have to worry about its payment for a month at least.

However, if you pay with actual money, you can physically feel the paper money leaving your hand. This makes you more mindful of your expenses.

3. You May Get Stuck In A Debt-Trap

If you go on a spending spree with your credit card without a proper pay-back plan in place, you may be digging your own grave.

Debt trap is the worst thing that can happen to anyone financially. It eats you away physically, mentally and financially.

I know what you must be thinking: “this won’t happen to me!”

Well, you are wrong my dear friend.

Anyone, I repeat, anyone can get into a debt trap if he/she is an avid user of credit cards.

4. Concealed Terms & Conditions

Have you ever considered reading the terms and conditions when signing up for a credit card?

No?

I must tell you that you should.

I know the terms and conditions are written in a very small type but trust me, they are worth reading.

When you will actually read these terms and conditions, you will literally be shocked by the number of things that were being kept in the dark from you by the company.

This little fine print will uncover some unknown facts and policies related to your dear credit card.

5. Credit Cards Can Ruin Your Credit Score

If you fail to repay your credit card dues continuously, your credit score will start to diminish. And, as I am sure you would know, having a good credit score is extremely important.

If your credit score goes down, you’ll notice your insurance premium will go up. This is because some insurance companies check credit scores while calculating each individual’s premium, and when they’ll see that you have failed to pay the dues of your credit card, they’ll charge higher from you since you’re an irresponsible person in their eyes.

Also, that’s not it. A poor credit score is like a seed for a tree of financial problems.

Some companies check the credit scores of applicants before hiring them for a job. If and when you apply for a home loan, there are chances that you are required to pay a high interest, or worse, you’ll be denied the loan citing your low credit score.

6. Risk Of Ruining Relationships

Using a credit card can really ruin relationships!

Couples tend to fight over many topics, but the money topic tops that list. What if your partner is a spendthrift and therefore often ends up overspending, whereas you are a saver?

To avoid silly fights (that can soon turn into serious arguments), it is better to set up a budget and spending plan and avoid disturbances like a credit card.

7. Credit Cards Rob You Of Mental Peace

Answer me honestly: are you at peace when you know that you owe your friend money for that movie night?

No, right?

Well, think of the mental peace which comes when you don’t have to worry about any interest rates, penalties, dues, credit card bills etc.

One word: Priceless!

Trust me; this mental peace will give you a much greater satisfaction than whatever product you purchase through borrowing money.

Therefore, instead of borrowing through a credit card and losing sleep over it, make a wish list of your favorite items and buy them when you can really afford them.

It will be worth the wait!

In Conclusion…

In conclusion, while credit cards may prove to be your best friends in times of an emergency, they can very similarly turn into your worst enemies if used recklessly.

Therefore, you must say no to credit and use a card only when it is absolutely necessary.

Start saving each month and you’ll soon discover that you have enough funds for buying that ‘wish list item’ of yours! Also, this way you won’t have to worry about debt when you retire.

The comfort and advantages offered by credit cards make them amazing, but think about their downside as well before using.

Ciao!

Dishika <3

Dishika is a personal finance blogger at Bachat. With her articles, she breaks down complex financial concepts into bite-sized articles that are fun to read and easy to understand. Bachat is a one-of-its-kind mobile app that helps you save money on autopilot.

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How To Make A Budget Binder DIY Style

How To Make A Budget Binder DIY Style

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I’ve been using a DIY budget binder for almost 7 years now.

And, here’s the deal:

Once I learned how to make a budget binder, my finances improved almost immediately (and are still kicking ass today).

It gets better:

Click to learn everything you need to know to make a budget binder! Here's how to make a budget binder the simple and affordable way. If you want to stop stressing about money, you need to learn how to make a budget binder. This budget binder tutorial will help you make a budget binder so you can master your money and stop living paycheck to paycheck. Don't miss this overview of how to make a budget binder. #budgetbinder #howtomakeabudgetbinder #budgetbinderprintables #budgetbinderdiy

Some of the links in this post are "affiliate links." This means if you click on the link and purchase the item, I will receive an affiliate commission.  Please see our privacy policy here.

To make a budget binder DIY style is hella simple and equally affordable!

Today, I’ll walk you through:

  • what you’ll need to make a budget binder
  • how to set up your DIY budget binder
  • a basic overview of how to use your budget binder for financial success

Alrighty!  Let’s get into it.

Free Printables!

Sign up below for our free resource library to access tons of budgeting goodies!

Free Printables!

Sign up for our resource library to access tons of free goodies!

What You’ll Need To Make A Budget Binder

Making a budget binder DIY style is super simple.

Better yet?

DIY budget binders are also SUPER affordable!

Here’s what you’ll need to make your budget binder:

 

Once you have all your stuff (I love using Amazon Prime!) you can get started on creating your DIY budget binder.

How To Make A Budget Binder DIY Style

To quickly and easily set up you DIY budget binder, follow these steps:

1. Print your budget binder printables (get every budget printable needed here)

2.  3-hole punch your printables

3.  Place your yearly budgeting printables at the beginning of your binder (before the first divider)

4.  Insert your monthly budgeting printables, separated by 12 dividers; one for each month

It’s that simple!

How To Use A Budget Binder For Financial Success

Setting up your budget binder is simple.

The hard part?

Actually using your budget binder for financial success.

Here’s a quick overview of how to use a budget binder so you can finally stop stressing about money.

Income + Expenses

Use an income and expense organizing printable to write down your monthly income and expenses.  Then, evaluate if you’re living within or above your means by doing some simple math (total expenses – total income).  This information is critical to setting up a successful budget.

Create A Budget

Use the Create-A-Budget template to outline your budget for the year.  Decide how much money you can afford to put towards bills, miscellaneous spending, debt repayment, savings, and more.  Use a weekly or bi-weekly budget tracker to make sure you stick to your budget.

Financial, Debt Repayment, & Savings Goals

Use a financial goal planning printables to create long-term financial goals and plan out your action steps for success.  Do the same thing for your debt repayment and savings goals.  Then each month, track your progress with guided printables.

Bill Pay Calendar/Checklist

Use a bill pay calendar and/or checklist to list your monthly bills and check them off once they’re paid.

Account Ledger

Track your bill-pay account by monitoring how much money is coming in and going out.  Your ledger will help you stay on top of your account balance so you don’t spend money that you do not have.  Also great for noticing funky account activity and/or planning for unexpected expenses.

Daily Expense Tracker

Track your daily spending on miscellaneous items so you can recognize poor spending habits and stop them.

Take Action:

If you want to stop stressing about money, you gotta set up your DIY Budget Binder!

As you can see, it’s super simple and hella affordable.

So, don’t wait!

Click here to get your printables and never stress about money again.

Do you use a budget binder?  How do you set up it up?  Comment below!

Happy Budgeting!

Michelle

Click to learn everything you need to know to make a budget binder! Here's how to make a budget binder the simple and affordable way. If you want to stop stressing about money, you need to learn how to make a budget binder. This budget binder tutorial will help you make a budget binder so you can master your money and stop living paycheck to paycheck. Don't miss this overview of how to make a budget binder. #budgetbinder #howtomakeabudgetbinder #budgetbinderprintables #budgetbinderdiy

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An Overview Of The Budget Boss Planner Toolkit

An Overview Of The Budget Boss Planner Toolkit

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Do you struggle to organize your finances?

Is living paycheck to paycheck getting hella old?

I feel you.

So, here’s the deal:

Come learn everything you need to know about the highly talked about Budget Boss Binder! The 2019 Budget Boss Binder is a planner toolkit that includes every single budget binder printable you could ever need to master your money. The Budget Boss Binder has budget binder printables for creating a budget, tracking your money, paying off debt, and saving money. Come explore the ultimate Budget Boss Binder and get yours today! #budgetbossbinder #budgetbinder #budgetbinderprintables #budget

Some of the links in this post are “affiliate links.” This means if you click on the link and purchase the item, I will receive an affiliate commission.

Having a system to organize and track your finances is essential if you want to end the negative money cycle in your life.

Without a way to strategically plan your money moves, you are setting yourself up for a poor financial future.

And, let me guess:

A poor financial future is far from what you’re dreaming of.

No, I know you.  Because you’re like every other person on Earth:

You want to:

  • spend without limits,
  • pay your bills on time every month,
  • have leftover money for dream vacations,
  • stop the “I can’t afford it” pity train.

The Budget Boss Planner Toolkit will help you reach your ultimate money goals – and fast.

Let me show you how.

The Budget Boss Planner

Easily organize & track your finances with custom budget printables!

THE BUDGET BOSS PLANNER

Easily organize & track your finances with custom budget printables!

What Is The Budget Boss Planner Toolkit?

The Budget Boss Planner Toolkit includes every printable you need to create your own budget planner (or budget binder).

The Budget Boss Planner Toolkit will help you:

  • create a budget
  • track your budget
  • stick to your budget
  • decrease expenses
  • pay off debt
  • save money (for emergencies, retirement, college, etc.)
  • complete no spend challenges
  • organize your finances

and all in all, master your money.

With over 40 budget printables, you’ll never have to stress about money again.

Here’s the deal:

The printables included in the Budget Boss Planner Toolkit have helped us create a budget that we’ve been successfully sticking to for 6+ years, pay off $15,000 in debt, and start saving for our dream home.

It’s no exaggeration that you cannot be financially successful if you don’t track your finances.

change your money mindset

It simply doesn’t work like that.

Bottom line?

To stop living paycheck to paycheck and afford your dream life, you need to organize and track your finances.

That’s where the Budget Boss Planner Toolkit comes in.

Who Is The Budget Boss Planner Toolkit Made For?

The Budget Boss Planner Toolkit is for those of you who give a f*ck about your financial future.

You see, as you’ve likely gathered, you aren’t going to get rich by coincidence (well, not most of us anyway).

So, to make sure you will have a rich financial future, you need to be proactive and create a plan for your money.

The Budget Boss Planner Toolkit makes preparing for a rich future possible – and super easy – by providing you with simple templates to manage your money.

Things like:

  • budgeting templates
  • spending trackers
  • debt repayment plans
  • savings guides

will make it simple for you to get (and stay) financially free.

What Is Included In The Budget Boss Planner Toolkit?

Included in the Budget Boss Planner Toolkit, you’ll find over 40 budget + organizational printables:

  • Expense Organizer
  • Income Organizer
  • Financial Evaluation
  • Create-A-Budget Template
  • Bank Account Organizer
  • Financial Goals & Roadmap
  • Debt Payoff Goals & Roadmap
  • Savings Goals & Roadmap
  • Monthly Financial Review
  • Weekly Budget Plan
  • Bi-Weekly Budget Plan

 

  • Bill Pay Calendar (+ Monthly Financial Goals Tracker)
  • Bill Pay Checklist
  • Monthly Account Ledger
  • Daily Expense Tracker
  • Monthly Debt Payoff Tracker
  • Monthly Savings Tracker
  • No Spend Challenge Template
  • House Savings Tracker
  • Student Loan Debt Repayment Tracker
  • Lined & Dotted Notes Pages
  • 3 Budget Planner Title Pages
  • 12 Monthly Title Pages

Here’s a run-down on how to use each printable included in the Budget Boss Planner Toolkit.

Expense Organizer

Use your monthly expenses organizer at the start of each year to document your fixed and variable expenses.  This information is critical to setting up a successful budget.

Income Organizer + Financial Evaluation

At the start of each year, reevaluate your income from all sources in your household. Then, evaluate if you’re spending within or beyond your means by doing some simple math.

Create-A-Budget Template

Use the Create-A-Budget template to outline your budget for the year.  Decide how much money you can afford to put towards bills, miscellaneous spending, debt repayment, savings, and more.

Bank Account Organizer

Organize all your account information in one local place.  This template is also super helpful for automating your budget.

Financial Goals & Roadmap

Create long-term financial goals and plan out your action steps for success.

Debt Payoff Goals & Roadmap

Organize your debts and create debt repayment goals.  Then, plan out action steps to accomplish your debt repayment goals sooner.

Savings Goals & Roadmap

Save money faster by outlining your savings goals and how you plan to accomplish those goals.

Monthly Financial Review

Review the upcoming month by outlining which bills are due, for how much, and when.  Also, outline your debt repayment and savings goals here.

Weekly Budget Plan

Easily track your budget if you’re paid weekly.

Bi-Weekly Budget Plan

Easily track your budget if you’re paid bi-weekly.

Bill Pay Calendar (+ Financial Goals Tracker)

Write down your bill due dates and track the financial goals you created at the beginning of the year.

Bill Pay Checklist

Track your bill due dates, amounts, and whether or not they’ve been paid throughout the month.  Great for avoiding late fees!

Monthly Account Ledger

Track your bill-pay account by monitoring how much money is coming in and going out.  Your ledger will help you stay on top of your account balance so you don’t spend money that you do not have.  Also great for noticing funky account activity and/or planning for unexpected expenses.

Daily Expense Tracker

Track your daily spending on miscellaneous items so you can recognize poor spending habits and stop them.

Monthly Debt Payoff Tracker

Track your debt payoff journey each month to become debt-free sooner rather than later.

Monthly Savings Tracker

Reach your savings goals quicker by tracking your progress each month.

No Spend Challenge Template

Have a successful no-spend month by using this fun template.

House Savings Tracker

Use this house savings tracker to save for a down payment, home repairs, renovations, and more.

Student Loan Debt Repayment Tracker

Make getting rid of your student loan debt fun by using this tracker!

More About The Budget Boss Planner Toolkit

Along with containing every printable you’d ever need to create an epic budget binder, the Budget Boss Planner Toolkit has some more exciting features.

  1. The printables are undated, so you can use them forever
  2. The toolkit is both printable and digital
  3. The planner is updated yearly and sent directly to your inbox

The best part, though?

The Budget Boss Planner Toolkit is currently on sale for only $9 (originally $27)!

Yep, you read that right.

For a one-time cost of only $9, you will have an updated yearly financial planner for the rest of your life.

So, how do you score this epic deal?

How To Access The Budget Boss Planner Toolkit

To download your Budget Boss Planner for only $9, follow these simple steps:

  1. Click here to add the Budget Boss Planner Toolkit to your cart
  2. Checkout through our secure gateway
  3. Check your inbox for an email from SendOwl containing your planner download

Oh, and then become a total budget boss!

How To Set Up Your Budget Boss Planner Toolkit

To set up your budget binder, here’s what you’ll need:

 

Then, once you’ve printed out your Budget Boss Planner Toolkit you can organize it in your binder, using the dividers to separate each month.

Easy peasy!

Wrapping Up

If you do not track your finances, it is very difficult to create a strong financial present and future.

The best way to create wealth and abundance in your life is to track your finances in a budget binder so you have complete control over your money.

Tracking your spending and organizing your finances in a budget binder will help you to:

  • create a budget that works (our has been going strong for 6+ years)
  • pay off debt
  • save money

and more.

See, isn’t about time you stopped stressing about money??

Don’t forget!

The Budget Boss Planner Toolkit is on sale for $9 for just a few more days.

Make the smart money move by grabbing it now before it goes back up to $27! wink

How do you track your finances for success?  Leave a comment below!

BEST,

michelle

Come learn everything you need to know about the highly talked about Budget Boss Binder! The 2019 Budget Boss Binder is a planner toolkit that includes every single budget binder printable you could ever need to master your money. The Budget Boss Binder has budget binder printables for creating a budget, tracking your money, paying off debt, and saving money. Come explore the ultimate Budget Boss Binder and get yours today! #budgetbossbinder #budgetbinder #budgetbinderprintables #budget

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All Our Money Resources,All Free.Printables, planners, and eCourses to create your life of financial freedom!All Our Money Resources, All Free.Printables, planners, and eCourses to create your life of financial freedom!Out of cash? Use a credit card. Stuck in an...

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How To Make A Budget Binder DIY Style

I've been using a DIY budget binder for almost 7 years now. And, here's the deal: Once I learned how to make a budget binder, my finances improved almost immediately (and are still kicking ass today). It gets better:Some of the...

read more

An Overview Of The Budget Boss Planner Toolkit

Do you struggle to organize your finances? Is living paycheck to paycheck getting hella old? I feel you. So, here's the deal:Some of the links in this post are "affiliate links." This means if you click on the link and purchase...

read more

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Cash Envelope System: Get Started With The Ultimate Guide

Cash Envelope System: Get Started With The Ultimate Guide

All Our Money Resources,

All Free.

Printables, planners, and eCourses to create your life of financial freedom!

All Our Money Resources, All Free.

Printables, planners, and eCourses to create your life of financial freedom!

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Here’s a crazy stat:

Two-thirds of Americans don’t have a budget.

That means that 218 million people are spending their money will-nilly with no game plan.

Two hundred and eighteen million people who are not financially successful.

Because, let’s face it:

This is how to make a cash envelope system actually work. Click to read this ultimate guide to the cash envelope system. If you want to stop poor spending habits, pay off debt, and save money, check out the cash envelope system. Get started with the cash envelope system today after reading this post! #cashenvelopesystem #cashenvelope #budget #budgeting #budgetingmethods

Some of the links in this post are “affiliate links.” This means if you click on the link and purchase the item, I will receive an affiliate commission.

Without a budget, you are highly unlikely to be able to afford your lifestyle, pay down debt, or save money.

Are you one of these people?

It’s ok if you are.  I was too.

It gets better, though:

Creating a budget (or a plan) for your money is hella easy.

What isn’t always easy is sticking to your budget.

However, when you use a budgeting method, such as the 50/30/20 budget method, you can significantly increase your chances of sticking to a budget.

And, when you stick to a budget, you’ll be able to:

  • afford your lifestyle
  • pay down debt (and stay out of debt)
  • save more money
  • free up money for personal use

and more.

That sounds pretty sweet, right?

I know.  It totally does.

So, let’s get started.

Free Budgeting Printables!

Sign up for our resource library to access tons of free budgeting printables!

Free Budgeting Printables

Sign up for our resource library to access tons of free budgeting printables!

Why You Definitely Need A Budget 

Learning how to budget is super crucial if you want to stop living paycheck to paycheck and reach your financial goals.

But, budgeting can be the worst, so people tend to avoid it.  (Two-thirds of Americans to be exact!)

Here’s the deal, though:

Not budgeting is a huge, huge mistake.

Because, if there is one thing that you should keep organized in your life, it is your money.

So, why do so many people avoid budgeting their hard-earned cash?

Two reasons:

  • budgeting is can be time-consuming
  • budgeting is can be stressful

See, money is often the cause of stress, tension, and arguments between partners.  And, money controls most aspects of our lives, leaving us feeling like we often do not have enough.

So, why even bother with it all, right?

Wrong, wrong, wrong.

You 100% need a budget, regardless of how ‘little’ or ‘big’ your income is.

Because, here’s the deal:

Without a proper budget (and understanding of your finances), you will never, and I mean never, feel satisfied with your income and standard of living.

A budget is necessary if you want to:

  • afford your lifestyle
  • stop fighting about money
  • pay off debt (and stay out of debt)
  • save money

So, let’s dive in and see if a cash envelope system is right for you!

How To Set Up A Cash Envelope System

To set up a cash envelope system follow these steps:

  1. Determine Your Why Factor
  2. Collect Your Financial Information
  3. Calculate Your Income & Expenses
  4. Cut Costs (if necessary)
  5. Set Up Your Cash Envelope System
  6. Track Your Budget

And don’t miss these:

Super cute cash envelopes for sorting your money!

Who Is A Cash Envelope System Good For?

A cash envelope system of budgeting is awesome for people who have poor spending habits and who are unfamiliar with budgeting.

Wanna know why?

When you have and spend physical cash, you’re more likely to connect to the money flowing in and out of your hands.

I mean, it’s pretty damn easy to go a little crazy at Target when you’re swiping plastic, right?

But, with a cash envelope system, you can count the money you have, track the money you’ve spent, and become conscientious of your spending habits.

There are a few downsides to the cash envelope system, though.

Being that:

You’ve gotta use cash.  Meaning you have to go to the bank and get cash every time you are paid.

And, what about all those bills you pay online every month?  What’s the deal with those expenses when using a cash envelope system?

I hear ya.  Here’s the deal:

I highly suggest only using a cash envelope system for the ‘wants’ part of your budget.

Things like groceries, transportation costs, entertainment, personal spending, etc.

Yes, you will have to stop at your local ATM every time you get paid, but it’s worth it!

And, for your fixed expenses like rent, insurance, internet, etc, use a zero-based budget, budget by paycheck system, or an automated budgeting system.

Step 1:  Determine Your Why Factor

We’ve already established this:

Every single person needs a budget if they want to be financially successful.

But why.

This will be different for everybody, and you can determine your why factor by asking yourself these questions:

  1. What will budgeting help me do?
  2. How will budgeting make my life simpler?

For example:

You might want to start budgeting to stop living paycheck to paycheck, to pay off debt, or to save more money.

Knowing your why is essential because it creates meaning for your purpose.  Without it, you’d have no motivation to continue budgeting.

Because let’s be honest:

If you do not have a plan for your money, how are you going to afford your dream life?

Here’s a hint:

You won’t be able to.

So, once you establish the reason you want to start budgeting, I urge you to write it down!

Why?

Because writing it down makes it real and it reminds you of why you started in the first place (if/when budgeting gets tough).

Step 2:  Collect Your Financial Information

Want to know the best part about this step:

It’s hella simple and shouldn’t take you much time at all.

You’re simply going to gather up your financial information. (i.e., pay stubs and bills)

You’ll need:

  • a months worth of pay stubs (and your partners, if applicable)
  • all the bills you currently pay, their individual costs, and when they’re due
  • an average of monthly variable expenses

And that’s all folks!

Step 3:  Calculate Your Income + Expenses

The start of every budget begins by calculating your income and expenses.

It is a crucial step to creating a budget that works because:

If you’ve never budgeted before, you probably don’t have a firm understanding of your finances.

Therefore, you’re probably spending more than you can afford (or not spending your money efficiently).

So, to determine if you need to cut back on expenses before you start budgeting (for better budgeting success) calculate your income and expenses now.

Your Income:

Using the information you gathered during step two, calculate your total monthly income (after taxes) from all sources.

Once you know exactly how much money you earn each month, you can determine if you are living within or beyond your means.

For the purposes of this post, let’s pretend my total monthly income is $4,500 and I am paid weekly.

(Monthly Income Organizer & Financial Evaluation available in the Budget Boss Planner)

Your Expenses:

Next, you’ll want to calculate your total monthly expenses.

For the purposes of your cash envelope system, break your expenses into two categories:

1. Fixed Expenses

2. Variable Expenses (what you’ll be using cash for!)

If you aren’t sure what your monthly expenses are, begin tracking your spending in a financial planner to calculate an average at the end of the month.

(Monthly Expense Organizer available in the Budget Boss Planner)

For the purposes of this post, let’s pretend my fixed expenses total $2,250 and my variable expenses total $1,350.

Step 4:  Cut Costs (if necessary)

Once you’ve calculated your monthly income and expenses, you can quickly decipher if you’re living within or above your means.

To do this, simply subtract your total expenses from your total income.

If the number is a positive number:

You’re in the green and should be able to afford your lifestyle with ease each month and can easily move onto setting up your zero based budget.

If the number you calculated is a negative number:

You’re in the red and cannot afford your current lifestyle, meaning you will have to decrease your expenses if you want to successfully start budgeting.

If you’re in the red and need to cut costs, use these tips and resources:

1.  A Budgeting Planner – Use budgeting printables, like the ones found in the Budget Boss Planner, to begin tracking your finances and your spending.  Then, begin decreasing your expenses by stopping poor spending habits and canceling unused subscriptions.  Get your budgeting planner here.

Pssst!  Wanna save 70% on the Budget Boss Planner?  Sign up here to save!

2.  BillBargain – A fantastic resource that will help you lower your monthly expenses.  BillBargain has successfully negotiated over 85% of the bills they receive for cell phone bills, Wi-Fi, cable, and more.  The best part?  BillBargain is 100% risk-free.  If they don’t successfully negotiate a lower price for your bills, you don’t owe them a dime.

Get started with BillBargain for free here!

2.  Trim – Referred to as a financial health service, Trim securely connects to your bank account(s) to analyze spending, subscriptions, and recurring bill pay.  Then, Trim will help you cancel unused subscriptions, negotiate lower bill prices, and more.  In the last month alone, they’ve helped their users save over 1 million dollars.

Sign-up for Trim for free here!

3.  The Ultimate Guide To Frugal Living – Learn over one hundred ways to save money every day (thousands/year!).

Get your free frugal living checklist by signing up for our resource library.

This is how to make a cash envelope system actually work. Click to read this ultimate guide to the cash envelope system. If you want to stop poor spending habits, pay off debt, and save money, check out the cash envelope system. Get started with the cash envelope system today after reading this post! #cashenvelopesystem #cashenvelope #budget #budgeting #budgetingmethods

Step 5:  Set Up Your Cash Envelope System

To get started:

Next, follow these steps:

1.  Add up your monthly income (after taxes)

2.  Figure out which expenses you plan to use cash for (such as groceries, transportation costs, clothing, entertainment, etc.) and budget your monthly income accordingly

3.  Each time you are paid, visit the bank or ATM to withdraw your budgeted cash for the week or next two weeks

4.  Place budgeted cash into allocated cash envelopes for spending

For example:

My monthly take-home pay is $4,500 and I am paid weekly.  And, I have a $500 monthly budget for groceries.

So, each week, I will withdraw $125 ($500/4 weeks) to place into my ‘groceries’ cash envelope.

Here is the most important part though:

You MUST NOT take money from one envelope to make up the difference of overspending from another envelope.

For instance:

If you have $125 for groceries and the cashier rings you out at $128, you have to put something back.  Do not take $3 from your gas cash envelope.

Your cash envelope budget will not work if you don’t stick to this rule!

Step 6:  Tracking Your Budget

Most people forget this crucial part of budgeting and end up wondering why their budget failed a month after implementing it.

If you have a budget, then you need to track it.

Because, here’s the deal:

If you do not track your budget, you cannot make sure that you are sticking to your budget.  And, if you aren’t making sure that you’re sticking to your budget, your budget will fail.

You might be wondering:

How do you track your budget?

These are my recommendations:

1.  The Budget Boss Planner ($27 value)

A printable and digital budgeting planner designed to help you create & stick to a budget, pay off debt, save money, and more.  The Budget Boss Planner is un-dated so you only have to purchase once to use this planner forever.

To take a peek inside the Budget Boss Planner, click here.

HINT: When you sign up here to become a VIP, you can score the Budget Boss Planner for just $9 (instead of $27!) — You’ll be automatically redirected to a discounted purchase page.

2.  Honey Money ($50 value)

An online resource to track your budget.  Honey Money is the internet’s version of a printable financial planner.  Within your dashboard, you can create your budget, track your budget, create debt repayment and savings goals, and more.  If you aren’t a pen and paper kinda person, I highly recommend this budget tracking resource.  

Get started with Honey Money for free here.

Again, when you track your budget, you ensure that the system you put into place is working correctly.

Don’t let the time you spent creating a budget go to waste by avoiding this simple step!

Wrapping Up

A cash envelope system is a great way to open your eyes up to poor spending habits and get your spending under control.

You’ll be able to:

  • recognize spending habits
  • create spending rules and boundaries
  • stop wasting your hard-earned cash

So, take action:

Gather your financial information, implement your cash envelope system, and track your budget for success.

And, cheers to stressing less about money!

What budget system do you currently use?  Are you going to start a zero based budget?  Comment below!

Happy Budgeting!

Michelle

This is how to make a cash envelope system actually work. Click to read this ultimate guide to the cash envelope system. If you want to stop poor spending habits, pay off debt, and save money, check out the cash envelope system. Get started with the cash envelope system today after reading this post! #cashenvelopesystem #cashenvelope #budget #budgeting #budgetingmethods

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7 Reasons To Say ‘No’ to Credit Cards

All Our Money Resources,All Free.Printables, planners, and eCourses to create your life of financial freedom!All Our Money Resources, All Free.Printables, planners, and eCourses to create your life of financial freedom!Out of cash? Use a credit card. Stuck in an...

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How To Make A Budget Binder DIY Style

I've been using a DIY budget binder for almost 7 years now. And, here's the deal: Once I learned how to make a budget binder, my finances improved almost immediately (and are still kicking ass today). It gets better:Some of the...

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An Overview Of The Budget Boss Planner Toolkit

Do you struggle to organize your finances? Is living paycheck to paycheck getting hella old? I feel you. So, here's the deal:Some of the links in this post are "affiliate links." This means if you click on the link and purchase...

read more

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50/30/20 Budget Method: Everything You Need To Know To Get Started

50/30/20 Budget Method: Everything You Need To Know To Get Started

All Our Money Resources,

All Free.

Printables, planners, and eCourses to create your life of financial freedom!

All Our Money Resources, All Free.

Printables, planners, and eCourses to create your life of financial freedom!

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    Shares

Here’s a crazy stat:

Two-thirds of Americans don’t have a budget.

That means that 218 million people are spending their money will-nilly with no game plan.

Two hundred and eighteen million people who are not financially successful.

Because, let’s face it:

Click to read about the 50/30/20 budget method! The basis of the 50/30/20 budget is simple; assign 150% of your income to your needs, 30% to your wants, and 20% to savings and debt repayment. Don't miss this ultimate guide to the 50/30/20 budget if you want to take control of your finances and prepare for a rich financial future. Plus, get your 50/30/20 budget worksheet, template, and printables. #budget #503020budget #budgetingmethods

Some of the links in this post are “affiliate links.” This means if you click on the link and purchase the item, I will receive an affiliate commission.

Without a budget, you are highly unlikely to be able to afford your lifestyle, pay down debt, or save money.

Are you one of these people?

It’s ok if you are.  I was too.

It gets better, though:

Creating a budget (or a plan) for your money is hella easy.

What isn’t always easy is sticking to your budget.

However, when you use a budgeting method, such as the 50/30/20 budget method, you can significantly increase your chances of sticking to a budget.

And, when you stick to a budget, you’ll be able to:

  • afford your lifestyle
  • pay down debt (and stay out of debt)
  • save more money
  • free up money for personal use

and more.

That sounds pretty sweet, right?

I know.  It totally does.

So, let’s get started.

50/30/20 budget printable set

Sign up for our free resource library to access your 50/30/20 Budget printable set!

50/30/20 Budget Printable Set

Sign up for our free resource library to access your 50/30/20 Budgeting printable set!

Why You Definitely Need A Budget 

Learning how to budget is super crucial if you want to stop living paycheck to paycheck and reach your financial goals.

But, budgeting can be the worst, so people tend to avoid it.  (Two-thirds of Americans to be exact!)

Here’s the deal, though:

Not budgeting is a huge, huge mistake.

Because, if there is one thing that you should keep organized in your life, it is your money.

So, why do so many people avoid budgeting their hard-earned cash?

Two reasons:

  • budgeting is can be time-consuming
  • budgeting is can be stressful

See, money is often the cause of stress, tension, and arguments between partners.  And, money controls most aspects of our lives, leaving us feeling like we often do not have enough.

So, why even bother with it all, right?

Wrong, wrong, wrong.

You 100% need a budget, regardless of how ‘little’ or ‘big’ your income is.

Because, here’s the deal:

Without a proper budget (and understanding of your finances), you will never, and I mean never, feel satisfied with your income and standard of living.

A budget is necessary if you want to:

  • afford your lifestyle
  • stop fighting about money
  • pay off debt (and stay out of debt)
  • save money

So, let’s dive in and see if a 50/30/20 budget is right for you!

How To Set Up A 50/30/20 Budget

To set up a 50/30/20 budget follow these steps:

  1. Determine Your Why Factor
  2. Collect Your Financial Information
  3. Calculate Your Income & Expenses
  4. Cut Costs (if necessary)
  5. Set Up Your 50/30/20 Budget
  6. Track Your Budget

And don’t miss this:

Your free 50/30/20 budget starter bundle!

Who Is A 50/30/20 Budget Good For?

I’m gonna be honest:

A 50/30/20 budget is not for everybody.  In fact, I’d go as far as to say that this budget is not for most people.

Why’s that?

With a 50/30/20 budget, you will be spending 50% of your budget on needs, 30% of your budget on wants, and 20% of your budget on savings/debt repayment.

The first time I heard about a 50/30/20 budget, I thought:

“Wouldn’t that be nice!”

My point being that, a 50/30/20 budget is really restrictive and doesn’t work well for people who have a tight income to expense ratio.

A 50/30/20 budget IS good for you, though, if you have a lot of freedom in your budget and are looking for a more structured approach to your finances.

Step 1:  Determine Your Why Factor

We’ve already established this:

Every single person needs a budget if they want to be financially successful.

But why.

This will be different for everybody, and you can determine your why factor by asking yourself these questions:

  1. What will budgeting help me do?
  2. How will budgeting make my life simpler?

For example:

You might want to start budgeting to stop living paycheck to paycheck, to pay off debt, or to save more money.

Knowing your why is essential because it creates meaning for your purpose.  Without it, you’d have no motivation to continue budgeting.

Because let’s be honest:

If you do not have a plan for your money, how are you going to afford your dream life?

Here’s a hint:

You won’t be able to.

So, once you establish the reason you want to start budgeting, I urge you to write it down!

Why?

Because writing it down makes it real and it reminds you of why you started in the first place (if/when budgeting gets tough).

Step 2:  Collect Your Financial Information

Want to know the best part about this step:

It’s hella simple and shouldn’t take you much time at all.

You’re simply going to gather up your financial information. (i.e., pay stubs and bills)

You’ll need:

  • a months worth of pay stubs (and your partners, if applicable)
  • all the bills you currently pay, their individual costs, and when they’re due
  • bank account information

And that’s all folks!

Step 3:  Calculate Your Income + Expenses

The start of every budget begins by calculating your income and expenses.

It is a crucial step to creating a budget that works because:

If you’ve never budgeted before, you probably don’t have a firm understanding of your finances.

Therefore, you’re probably spending more than you can afford (or not spending your money efficiently).

So, to determine if you need to cut back on expenses before you start budgeting (for better budgeting success) calculate your income and expenses now.

Your Income:

Using the information you gathered during step two, calculate your total monthly income (after taxes) from all sources.

Once you know exactly how much money you earn each month, you can determine if you are living within or beyond your means.

For the purposes of this post, let’s pretend your total monthly income is $4,500.

(Monthly Income Organizer & Financial Evaluation available in the Budget Boss Planner)

Your Expenses:

Next, you’ll want to calculate your total monthly expenses.

For the purposes of the 50/30/20 budget, break your expenses down into two categories:

1. Needs

2. Wants

If you aren’t sure what your monthly expenses are, begin tracking your spending in a financial planner to calculate an average at the end of the month.

For the purposes of this post, let’s pretend our needs total $2,250 and our wants total $1,350.

Step 4:  Cut Costs (if necessary)

Once you’ve calculated your monthly income and expenses, you can quickly decipher if you’re living within or above your means.

To do this, simply subtract your total expenses from your total income.

If the number is a positive number:

You’re in the green and should be able to afford your lifestyle with ease each month and can easily move onto setting up your zero based budget.

If the number you calculated is a negative number:

You’re in the red and cannot afford your current lifestyle, meaning you will have to decrease your expenses if you want to successfully start budgeting.

If you’re in the red and need to cut costs, use these tips and resources:

  • A Budgeting Planner – Use budgeting printables, like the ones found in the Budget Boss Planner, to begin tracking your finances and your spending.  Then, begin decreasing your expenses by stopping poor spending habits and canceling unused subscriptions.  Get your budgeting planner here.

Pssst!  Wanna save 70% on the Budget Boss Planner?  Sign up here to save!

  • BillBargain – A fantastic resource that will help you lower your monthly expenses.  BillBargain has successfully negotiated over 85% of the bills they receive for cell phone bills, Wi-Fi, cable, and more.  The best part?  BillBargain is 100% risk-free.  If they don’t successfully negotiate a lower price for your bills, you don’t owe them a dime. Get started for free here!
  • Trim – Referred to as a financial health service, Trim securely connects to your bank account(s) to analyze spending, subscriptions, and recurring bill pay.  Then, Trim will help you cancel unused subscriptions, negotiate lower bill prices, and more.  In the last month alone, they’ve helped their users save over 1 million dollars.  Sign-up for free here!
  • The Ultimate Guide To Frugal Living – Learn over one hundred ways to save money every day (thousands/year!). Get your free frugal living checklist by signing up for our resource library.
Click to read about the 50/30/20 budget method! The basis of the 50/30/20 budget is simple; assign 150% of your income to your needs, 30% to your wants, and 20% to savings and debt repayment. Don't miss this ultimate guide to the 50/30/20 budget if you want to take control of your finances and prepare for a rich financial future. Plus, get your 50/30/20 budget worksheet, template, and printables. #budget #503020budget #budgetingmethods

Step 5:  Create Your 50/30/20 Budget

To get started:

Next, follow these steps:

1.  Add up your monthly income (after taxes)

2.  Multiply your total monthly income by 0.5.  This is how much money you should be spending on your needs.  (Refer to the list your made earlier.  If you’ve exceeded 50%, you need to cut costs to make this budget work.)

3.  Multiply your total monthly income by 0.3.  This is how much money you can spend on your wants.  (Refer to your list.  Does this number match up?)

4.  Multiply your total monthly income by 0.2.  This is how much money you have to put towards debt repayment and/or savings.

As you can see, the 50/30/20 budget is great for becoming more intentional with how you spend your money.

If your percentages aren’t evening out correctly, try decreasing your expenses, making more money, or trying a different budgeting method.

To get started with your 50/30/20 budget, download your free printable bundle here.

Step 6:  Tracking Your Budget

Most people forget this crucial part of budgeting and end up wondering why their budget failed a month after implementing it.

If you have a budget, then you need to track it.

Because, here’s the deal:

If you do not track your budget, you cannot make sure that you are sticking to your budget.  And, if you aren’t making sure that you’re sticking to your budget, your budget will fail.

You might be wondering:

How do you track your budget?

These are my recommendations:

1.  The Budget Boss Planner ($27 value)

A printable and digital budgeting planner designed to help you create & stick to a budget, pay off debt, save money, and more.  The Budget Boss Planner is un-dated so you only have to purchase once to use this planner forever.

To take a peek inside the Budget Boss Planner, click here.

HINT: When you sign up here to become a VIP and download your 50/30/20 budget printables, you can score the Budget Boss Planner for just $9 (instead of $27!) — You’ll be automatically redirected to a discounted purchase page.

2.  Honey Money ($50 value)

An online resource to track your budget.  Honey Money is the internet’s version of a printable financial planner.  Within your dashboard, you can create your budget, track your budget, create debt repayment and savings goals, and more.  If you aren’t a pen and paper kinda person, I highly recommend this budget tracking resource.  

Get started with Honey Money for free here.

Again, when you track your budget, you ensure that the system you put into place is working correctly.

Don’t let the time you spent creating a budget go to waste by avoiding this simple step!

Wrapping Up

A 50/30/20 budget is the perfect way to spend your money mindfully.

You’ll be able to:

  • afford your bills and necessities with ease
  • have extra money for your wants (who doesn’t love that!?)
  • easily pay off debt and/or save money

So, take action:

Gather your financial information, implement your 50/30/20 budget, and track your budget for success.

Don’t forget your free 50/30/20 buget printables bundle!

And, cheers to stressing less about money!

What budget system do you currently use?  Are you going to start a zero based budget?  Comment below!

Happy Budgeting!

Michelle

Click to read about the 50/30/20 budget method! The basis of the 50/30/20 budget is simple; assign 150% of your income to your needs, 30% to your wants, and 20% to savings and debt repayment. Don't miss this ultimate guide to the 50/30/20 budget if you want to take control of your finances and prepare for a rich financial future. Plus, get your 50/30/20 budget worksheet, template, and printables. #budget #503020budget #budgetingmethods

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7 Reasons To Say ‘No’ to Credit Cards

All Our Money Resources,All Free.Printables, planners, and eCourses to create your life of financial freedom!All Our Money Resources, All Free.Printables, planners, and eCourses to create your life of financial freedom!Out of cash? Use a credit card. Stuck in an...

read more

How To Make A Budget Binder DIY Style

I've been using a DIY budget binder for almost 7 years now. And, here's the deal: Once I learned how to make a budget binder, my finances improved almost immediately (and are still kicking ass today). It gets better:Some of the...

read more

An Overview Of The Budget Boss Planner Toolkit

Do you struggle to organize your finances? Is living paycheck to paycheck getting hella old? I feel you. So, here's the deal:Some of the links in this post are "affiliate links." This means if you click on the link and purchase...

read more

JOIN THE WHO SAYS WHAT COMMUNITY!

HOME  |   CONTACT  |   LEGAL

Copyright 2016-2019 Who Says What

CREATED USING DIVI   |   POWERED BY TMDHOSTING

Zero-Based Budget: Everything You Need To Know To Get Started

Zero-Based Budget: Everything You Need To Know To Get Started

All Our Money Resources,

All Free.

Printables, planners, and eCourses to create your life of financial freedom!

All Our Money Resources, All Free.

Printables, planners, and eCourses to create your life of financial freedom!

  • 1K
    Shares

Here’s a crazy stat:

Two-thirds of Americans don’t have a budget.

That means that 218 million people are spending their money will-nilly with no game plan.

Two hundred and eighteen million people who are not financially successful.

Because, let’s face it:

Budgeting is essential to your financial success. A zero based budget is a great way to take control of your finance and life. Click to learn how to make a zero based budget. And, don't forget your zero based budget printable! If you want to know what is a zero based budget and how it can help you pay off debt, save money, and more, don't miss this post. Get started today with your zero based budget so you can have a better financial future. #zerobasedbudget #budgetingmethods #budgeting

Some of the links in this post are “affiliate links.” This means if you click on the link and purchase the item, I will receive an affiliate commission.

Without a budget, you are highly unlikely to be able to afford your lifestyle, pay down debt, or save money.

Are you one of these people?

It’s ok if you are.  I was too.

And it gets better:

Creating a budget (or a plan) for your money is hella easy.

What isn’t always easy is sticking to your budget.

However, when you use a budgeting method, such as the zero based budget method, you can significantly increase your chances of sticking to a budget.

And, when you stick to a budget, you’ll be able to:

  • afford your lifestyle
  • pay down debt (and stay out of debt)
  • save more money
  • free up money for personal use

and more.

That sounds pretty sweet, right?

I know.  It totally does.

So, let’s get started.

zero based budget printable set

Sign up for our free resource library to access your Zero Based Budgeting printable set!

Zero Based Budget Printable Set

Sign up for our free resource library to access your Zero Based Budgeting printable set!

Why You Definitely Need A Budget 

Learning how to budget is super crucial if you want to stop living paycheck to paycheck and reach your financial goals.

But, budgeting can be the worst, so people tend to avoid it.  (Two-thirds of Americans to be exact!)

Here’s the deal, though:

Not budgeting is a huge, huge mistake.

Because, if there is one thing that you should keep organized in your life, it is your money.

So, why do so many people avoid budgeting their hard-earned cash?

Two reasons:

  • budgeting is can be time-consuming
  • budgeting is can be stressful

See, money is often the cause of stress, tension, and arguments between partners.  And, money controls most aspects of our lives, leaving us feeling like we often do not have enough.

So, why even bother with it all, right?

Wrong, wrong, wrong.

You 100% need a budget, regardless of how ‘little’ or ‘big’ your income is.

Because, here’s the deal:

Without a proper budget (and understanding of your finances), you will never, and I mean never, feel satisfied with your income and standard of living.

A budget is necessary if you want to:

  • afford your lifestyle
  • stop fighting about money
  • pay off debt (and stay out of debt)
  • save money

So, let’s set up your zero based budget so you can prepare for a kickass financial future.

How To Use A Zero Based Budget

To set up a zero based budget follow these steps:

  1. Determine Your Why Factor
  2. Collect Your Financial Information
  3. Calculate Your Income & Expenses
  4. Cut Costs (if necessary)
  5. Create Your Zero Based Budget
  6. Track Your Budget

And don’t miss this:

Your free zero based budgeting starter bundle!

Who Is A Zero Based Budget Good For?

Everybody can benefit from a zero based budget, especially if you really, really like to plan (like me!).

Why’s that?

With a zero based budget, you will be assigning every dollar you earn to a category, such as expenses, savings, or debt repayment.

Simply put, a zero based budget will:

  • establish a plan for every dollar you earn
  • make sure you’re living within your means
  • help you pay off debt and save money

The pros of a zero based budget include:

  • being able to easily eliminate poor spending habits by not allocating money to that category of spending
  • always having enough money allocated for bills and other necessities
  • quickly paying off debt by allocating more money to debt repayment efforts
  • easily saving money by allocating spare money to a high-interest savings account

 The cons of a zero based budget are:  None.

But really:

A zero based budget is simple, straightforward, and doesn’t restrict your lifestyle in any way.

Let’s dive into the deets.

Step 1:  Determine Your Why Factor

We’ve already established this:

Every single person needs a budget if they want to be financially successful.

But why.

This will be different for everybody, and you can determine your why factor by asking yourself these questions:

  1. What will budgeting help me do?
  2. How will budgeting make my life simpler?

For example:

You might want to start budgeting to stop living paycheck to paycheck, to pay off debt, or to save more money.

Knowing your why is essential because it creates meaning for your purpose.  Without it, you’d have no motivation to continue budgeting.

Because let’s be honest:

If you do not have a plan for your money, how are you going to afford your dream life?

Here’s a hint:

You won’t be able to.

So, once you establish the reason you want to start budgeting, I urge you to write it down!

Why?

Because writing it down makes it real and it reminds you of why you started in the first place (if/when budgeting gets tough).

Recommended:  Need a spot to write down your motivation for budgeting?  I highly recommend investing in a budgeting planner, like the Budget Boss Planner.  Keeping all your financial information in one tidy spot makes budgeting a whooole lot easier!

Step 2:  Collect Your Financial Information

Want to know the best part about this step:

It’s hella simple and shouldn’t take you much time at all.

You’re simply going to gather up your financial information. (i.e., pay stubs and bills)

You’ll need:

  • a months worth of pay stubs (and your partners, if applicable)
  • all the bills you currently pay, their individual costs, and when they’re due
  • your personal spending habits

This is crazy, but:

Most people don’t actually know how much money they make or how much money they spend.

And, when you don’t know this information, it is impossible to budget.

So, to avoid playing guessing games, take the time to gather your financial information before you try to create a budget.

Helpful Hint:  If you are unsure of your exact income and expenses, track your finances in a budgeting planner to find out!

Step 3:  Calculate Your Income + Expenses

Before you can assign your income to categories (i.e., create a zero based budget), you need to establish your average monthly income and expenses.

Here’s why:

If you’ve never budgeted before, you probably don’t have a firm understanding of your finances.

Therefore, you’re probably spending more than you can afford (or not spending your money efficiently).

So, to determine if you need to cut back on expenses before you start budgeting (for better budgeting success) calculate your income and expenses now.

(Knowing your exact monthly income and expenses is also critical for planning out a zero based budget.)

Your Income:

Using the information you gathered during step two, calculate your total monthly income (after taxes) from all sources.

Once you know exactly how much money you earn each month, you can determine if you are living within or beyond your means.

For the purposes of this post, let’s pretend your total monthly income is $4,500.

(Monthly Income Organizer & Financial Evaluation available in the Budget Boss Planner)

Your Expenses:

Next, you’ll want to calculate your total monthly expenses.

For the purposes of most budgets, break your expenses down into two categories:

1. Fixed Expenses

2. Variable Expenses

Fixed expenses are bills that you are required to pay monthly, such as rent/mortgage, utilities, cell phone, credit cards, insurance, etc.

Variable expenses are those that vary in cost each month and could be decreased or eliminated if needed.  These expenses include things like groceries, transportation, entertainment, and more.

If you aren’t sure what your monthly variable expenses are, begin tracking your spending in a financial planner to calculate an average at the end of the month.

For the purposes of this post, let’s pretend our total fixed expenses equal $2970 and our total variable expenses equal $730.

(Monthly Income Organizer & Financial Evaluation available in the Budget Boss Planner)

Step 4:  Cut Costs (if necessary)

Once you’ve calculated your monthly income and expenses, you can quickly decipher if you’re living within or above your means.

To do this, simply subtract your total expenses from your total income.

If the number is a positive number:

You’re in the green and should be able to afford your lifestyle with ease each month and can easily move onto setting up your zero based budget.

If the number you calculated is a negative number:

You’re in the red and cannot afford your current lifestyle, meaning you will have to decrease your expenses if you want to successfully start budgeting.

If you are in the red and need to cut costs, these are the best resources:

1.  Use BillBargain

This is a fantastic resource that will help you lower your monthly expenses.  BillBargain has successfully negotiated over 85% of the bills they receive for cell phone bills, Wi-Fi, cable, and more.  The best part?  BillBargain is 100% risk-free.  If they don’t successfully negotiate a lower price for your bills, you don’t owe them a dime.

Get started with BillBargain for free here!

2.  Pay Off Your Debt

Credit card debt will suck you dry every month if you don’t work hard now to pay off what you owe.  I highly recommend consolidating your credit card debt into a low-interest personal loan to save tons of money and pay off your debt in half the time. (Doing this helped me pay off $15,000 in debt in only 12 months!)

3.  Sign Up For Trim

Referred to as a financial health service, Trim securely connects to your bank account(s) to analyze spending, subscriptions, and recurring bill pay.  Then, Trim will help you cancel unused subscriptions, negotiate lower bill prices, and more.  In the last month alone, they’ve helped their users save over $1,000,000!!

Sign-up for Trim for free here!

101 Ways To Save Money:  Read our ultimate guide to frugal living to discover 101 ways to save thousands of dollars a year!

Budgeting is essential to your financial success. A zero based budget is a great way to take control of your finance and life. Click to learn how to make a zero based budget. And, don't forget your zero based budget printable! If you want to know what is a zero based budget and how it can help you pay off debt, save money, and more, don't miss this post. Get started today with your zero based budget so you can have a better financial future. #zerobasedbudget #budgetingmethods #budgeting

Step 5:  Create Your Zero Based Budget

To get started:

Next, follow these steps:

1.  Add up your monthly income (after taxes): $4,500

2.  Total your monthly fixed expenses: $2,970

3.  Total your monthly variable expenses: $730

4.  Subtract your total monthly expenses from your total monthly income to see how much money you have left to budget:  $4500 – $3700 = $800

5.  Assign the rest of the money ($800) to debt repayment, savings, retirement, vacation fund, and more.

6.  Subtract steps 2-4 from step 1 to get ZERO.

The goal is to reach zero at the end of your budget planning and calculations, meaning that every dollar you earn has a job each month.

This is great because you’ll be able to easily budget for your lifestyle while also affording to pay off debt and save money.

And, the best part:

Your zero based budget can change every month to align with your current financial goals.

Remember:  If your budget doesn’t balance to zero and instead equals a negative number, you have to cut costs.

To get started with your zero based budget, download your free printable bundle here.

Step 6:  Tracking Your Budget

Most people forget this crucial part of budgeting and end up wondering why their budget failed a month after implementing it.

If you have a budget, then you need to track it.

Because, here’s the deal:

If you do not track your budget, you cannot make sure that you are sticking to your budget.  And, if you aren’t making sure that you’re sticking to your budget, your budget will fail.

You might be wondering:

How do you track your budget?

Here are the best budget tracking resources:

1.  The Budget Boss Planner ($27 value)

A printable and digital budgeting planner designed to help you create & stick to a budget, pay off debt, save money, and more.  The Budget Boss Planner is un-dated so you only have to purchase once to use this planner forever.

To take a peek inside the Budget Boss Planner, click here.

HINT: When you sign up here to become a VIP and download your zero based budget printables, you can score the Budget Boss Planner for just $9 (instead of $27!) — You’ll be automatically redirected to a discounted purchase page.

2.  Honey Money ($50 value)

An online resource to track your budget.  Honey Money is the internet’s version of a printable financial planner.  Within your dashboard, you can create your budget, track your budget, create debt repayment and savings goals, and more.  If you aren’t a pen and paper kinda person, I highly recommend this budget tracking resource.  

Get started with Honey Money for free here.

Again, when you track your budget, you ensure that the system you put into place is working correctly.

Don’t let the time you spent creating a budget go to waste by avoiding this simple step!

Wrapping Up

A zero based budget is the ultimate way to take control of your money (and your life).

In fact:

A zero based budget is the exact budgeting method we used to pay off over $15,000 in debt in under a year.

I know.  These are high claims for a simple budgeting method.

But, it’s true.

And, I want the same things for you.

So, take action:

Gather your financial information, implement your zero based budget, and track your budget for success.

Don’t forget your free budget by paycheck bundle!

And, cheers to stressing less about money!

What budget system do you currently use?  Are you going to start a zero based budget?  Comment below!

Happy Budgeting!

Michelle

Budgeting is essential to your financial success. A zero based budget is a great way to take control of your finance and life. Click to learn how to make a zero based budget. And, don't forget your zero based budget printable! If you want to know what is a zero based budget and how it can help you pay off debt, save money, and more, don't miss this post. Get started today with your zero based budget so you can have a better financial future. #zerobasedbudget #budgetingmethods #budgeting

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