Recording Budget Information You will need a few tools to work on your budget.
First, decide if you will budget electronically or manually.
Some people do not like working with computers; that is fine, use what is comfortable, but stay with it.
Many existing budgeting software packages will do more than you need to start.
Still, if you are happy using computers, you will find these packages helpful to set up and work out your budget.
Besides, they will give good expense analyses, and if you wish to use Internet banking, they will reduce time spent budgeting.
Though it gives flexibility and allows you to stay on top of your finances, Internet banking isn't essential, and if you are not alert, can expose you to risk.
If you feel safe with this arrangement, use it wisely.
It can speed up reviewing and reconciling your accounts, and comparing results with plans and budgets.
Before using Internet banking, ensure you understand needed security precautions--don't give out your password, and never reply electronically to requests for private information.
Rest assured, crooks alone request this information--many are roaming the Internet posing as your bank.
Banking Needs and Arrangements Next, decide your banking needs.
How many checks will you write monthly? How many transactions are you likely to have in the account? How many bank accounts might you need? Two accounts might be useful--one for current expenses such as groceries, another for non-recurring payments such as vacation savings, birthdays, Christmas gifts, and annual car license renewal.
After settling bank accounts, decide types, and specific institution.
Will you use a bank or a credit union? With the later, you are an owner, but access might be limited.
What is the big deal with bank accounts? No two bank accounts are alike.
Most banks are aggressive with service, and other fees, while some charge no fees, but have several restrictions on access to funds.
I have seen a steady service decline and rapid fee hikes.
Before choosing which account works best for you, look at accounts banks offer, and conditions attached to each.
As you review your banking arrangements, shop around to assess specific benefits to you from different accounts.
Select the right account, choosing consciously between an account with a bank or an account with a credit union.
Pick an account that fits your needs at a reasonable cost.
I have seen individuals pay over $40 monthly ATM fees to get money from their bank account--money that could go to God's work rather than to financial institutions.
Document Retrieval System Notice, I didn't say, "filing" system.
You need to think retrieval, recall.
Ask: (1) "For legal and personal reasons, what bills and other information do I think I need to keep? (2) How long might I need to hold them? (3) How will I refer to these documents when I need them?" Should you file a warranty for your fridge with the fridge's invoice or with warranties? That's the issue, and it's your call.
Think about how many filing categories you will need for bills, warranties, taxes, utilities, housing, and so on.
Keep the number low, and remember, an expandable binder could be perfect.
Yearly, decide what you need to keep and what you can cull.
Summary With the right tools, you eliminate stress to do any job, including your budget.
Think also about getting an accountability partner to help you develop budgeting discipline.
After understanding the budget, getting needed tools, doing the budget, and choosing an accountability partner, the probability you will stick with the budget rises significantly.
In fact, your financial affairs will improve especially, when you recognize money management is lifestyle management.
Copyright (c) 2011, Michel A Bell
First, decide if you will budget electronically or manually.
Some people do not like working with computers; that is fine, use what is comfortable, but stay with it.
Many existing budgeting software packages will do more than you need to start.
Still, if you are happy using computers, you will find these packages helpful to set up and work out your budget.
Besides, they will give good expense analyses, and if you wish to use Internet banking, they will reduce time spent budgeting.
Though it gives flexibility and allows you to stay on top of your finances, Internet banking isn't essential, and if you are not alert, can expose you to risk.
If you feel safe with this arrangement, use it wisely.
It can speed up reviewing and reconciling your accounts, and comparing results with plans and budgets.
Before using Internet banking, ensure you understand needed security precautions--don't give out your password, and never reply electronically to requests for private information.
Rest assured, crooks alone request this information--many are roaming the Internet posing as your bank.
Banking Needs and Arrangements Next, decide your banking needs.
How many checks will you write monthly? How many transactions are you likely to have in the account? How many bank accounts might you need? Two accounts might be useful--one for current expenses such as groceries, another for non-recurring payments such as vacation savings, birthdays, Christmas gifts, and annual car license renewal.
After settling bank accounts, decide types, and specific institution.
Will you use a bank or a credit union? With the later, you are an owner, but access might be limited.
What is the big deal with bank accounts? No two bank accounts are alike.
Most banks are aggressive with service, and other fees, while some charge no fees, but have several restrictions on access to funds.
I have seen a steady service decline and rapid fee hikes.
Before choosing which account works best for you, look at accounts banks offer, and conditions attached to each.
As you review your banking arrangements, shop around to assess specific benefits to you from different accounts.
Select the right account, choosing consciously between an account with a bank or an account with a credit union.
Pick an account that fits your needs at a reasonable cost.
I have seen individuals pay over $40 monthly ATM fees to get money from their bank account--money that could go to God's work rather than to financial institutions.
Document Retrieval System Notice, I didn't say, "filing" system.
You need to think retrieval, recall.
Ask: (1) "For legal and personal reasons, what bills and other information do I think I need to keep? (2) How long might I need to hold them? (3) How will I refer to these documents when I need them?" Should you file a warranty for your fridge with the fridge's invoice or with warranties? That's the issue, and it's your call.
Think about how many filing categories you will need for bills, warranties, taxes, utilities, housing, and so on.
Keep the number low, and remember, an expandable binder could be perfect.
Yearly, decide what you need to keep and what you can cull.
Summary With the right tools, you eliminate stress to do any job, including your budget.
Think also about getting an accountability partner to help you develop budgeting discipline.
After understanding the budget, getting needed tools, doing the budget, and choosing an accountability partner, the probability you will stick with the budget rises significantly.
In fact, your financial affairs will improve especially, when you recognize money management is lifestyle management.
Copyright (c) 2011, Michel A Bell
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