Take Control of Your Money

When your job situation is insecure, it is even more important that you effectively manage your finances.  By creating and following a budget, you get an understanding of your financial position, you gain control of your spending, and you make smarter decisions about your money.  Follow these steps to create your own budget and you will be well on your way to achieving your financial goals.

Write down your income.  If your income varies from month to month, average out your yearly earnings.

Record your expenses.  Make a list of all your expenses and if necessary, record your spending for a few weeks.  It is important that you know where your money is going because you may be spending more than you realize in a particular area.

Subtract your expenses from your income.  Are you saving money, breaking even, or going into debt?  This calculation will help you determine your level of financial health.

Evaluate your budget.  Distinguish between your fixed and variable expenses.  Where do you have opportunities to save money?  Where are you spending too much?

Set financial goals.  What do you want to achieve and how much will it cost?  Do you want to buy a house?  Travel?  Start a business?  Just make sure that your goals are realistic and that they truly reflect your values.

Creating a budget is the easy part, but sticking to it can be challenging.  In order to be successful, you need to keep it in mind whenever you take out your wallet.  While it may feel uncomfortable to track every penny, it is more pleasant than dealing with financial insecurity.

(Written by: Karen Bivand, Photo by: patpitchaya/ FreeDigitalPhotos.net)

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