Basics of Budgeting with Mutual Savings Credit Union (Part 4)
Note: To help members gear up for 2013, Mutual Savings Credit Union is beginning a 5-part series of web posts that will help you understand the basics of budgeting. All of this information is made available for free thanks to MSCU’s partnership with brass|Media. Be sure to check out Mutual Savings’ BRASS website for additional tips on financial matters.
Creating a budget doesn’t mean you can’t spend money, so don’t stop reading yet. Most people cringe at the word “budget,” but it really can be a comforting tool to ensure your money is in order. Essentially, a budget is a plan for how you will spend your cash. It can help you understand where your money goes–not to mention how to streamline your spending to save a little extra. Part 4 of our series pertains to getting organized and tracking expenses.
PART FOUR: PUTTING IT ALL TOGETHER
You now know your income, as well as your fixed and variable expenses. Take your income and subtract the expenses.
- If you get a negative number, it’s time to go back to the drawing board. Start with your variable expenses and allot yourself a bit less in non-essential categories like entertainment and meals out. Next, take a look at your fixed expenses. If loan or credit card payments are requiring a large chunk of your budget, call your creditors to see if you can lower your interest rate or monthly payment. Consider consolidating. Still in the red? Start thinking about moving somewhere cheaper or getting a less expensive car.
- If you get a positive number, you have successfully budgeted for your anticipated expenses. However, there can still be room for cutbacks in order to use your money more efficiently. Consider increasing the amount you pay on debt like credit cards and student loans. This can also be a great time to pump up your savings plan each month.
Tracking your expenses effectively is the key to staying on top of your finances. There are several ways to keep records.
- Websites: Check out sites like mvelopes.com and buxfer.com that can help you get organized, set up a budget, and track your spending and saving. Choose one based on your needs, safety features and usability. Mutual Savings Credit Union and BALANCE also make a wealth of helpful information available for free.
- Software: Personal finance software can be expensive, but some programs may come pre-installed on your computer. If you’re interested, check out microsoft.com/money and quicken.com to download a free trial.
- Other tools: Check with Mutual Savings Credit Union and BALANCE for guides, resources, or even online tools such as an account aggregator, which collects and organizes your bills to help you track your spending and budget.
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