Fairly often I get people talking to me about how I really should start to budget each month and put money aside for those rainy days which happen more then they should.

Essentially I am constantly in denial about the fact I need to actually sit down one time with a financial adviser and sort my bleeding finances out. Now, I’m not saying that there is anything wrong with them, but its always nice to know that there is some way of improving what is going on.

Budgeting/Saving Money

Basically, the main reason for budgeting is fairly simply to understand - not budgeting leads to financial disorganization, which in turn leads to serious money problems. Being organized obviously allows one to have more fun and to perhaps even enjoy life a little bit more. 

Some key reasons for budgeting are as follows:

• · Be prepared to avoid surprises
• · Save money to buy something
• · Get out of debts
• · Get out of the vicious cycle of spend now and pay later
• · Rediscover that having fun can be FREE
• · Be financially comfortable

How?

The first thing you need to do is develop a deep awareness about how you deal with money and to see it in a crystal clear way is to write down on paper all the money you bring home (income) and all the money you pay out (expenses).

Make a list of all your income as a family then make a list of all your expenses. It might take sometime until you finish your list and the reason why is that we always have a lot more expenses that we can remember. So don’t think you are going to do it in 15 minutes. Keep the list open for a whole month and keep entering your expenses as it happens. Try to keep records of everything: coffees, tips, drinks and every little expense you make each month.

After the month has ended add up all your expenses and all your family income to have a clear idea how and why your money is going so quickly. Now you have to start making the cuts in your expenses if you are not happy with the results.

This is a really simple strategy to start to get you and your family out of debt. You have to be persistent and have the will power to continue until you get the results you want.

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