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How Do I Make a Budget ?

If you are struggling with your finances then you may wish to consider making a budget. In this way you can keep track of all the money that comes in and goes out allowing you to work out areas that you can hopefully cut back on.  

Keep a record of all Expenses ;
Listing all the items and the areas that you spend money on can be quite an eye opener. Sometimes the odd pound here and there and a magazine once a week can really add up and make quite a difference to your finances. Therefore one of the first things you should do is keep a record of everything that you spend your money on.

In order to do this it is worth making up a notebook specifically for the task. Divide your pages up into days and make sure that you write down what you buy and how much it cost. Make sure that you include any spends on your credit card, and anytime that you take money out of a cash machine or write a cheque. You can then add this all together at the end of the month and find out what your monthly expenditure was and if all of it was strictly necessary. By doing this you will hopefully be able to identify areas that you are spending too much on and can try to cut down.

When doing this you should bear in mind any one-off large payments that you had to make if they are not something that you regularly have to make. You should also keep a list of payments that are not made every month such as utility bills, taxes, subscription fees etc so you are aware that these need to be included in your budget. Listing all of your expenses is something that you should get into the habit of doing regularly.

Work out your Total Income ;
In order to work out your budget you will also need to see how much money is coming in every month. It may be worth using another notebook to keep track of this. You will then need to list the salary you receive for your job after tax and any extra work that earns you money. Also make sure that you list any credits or benefits that will add to your total income.

Once you have done this you will be able to work out roughly how much money you have every month and you can then compare this to the amount you are spending.