It is up to you to figure out how much you should be spending each month. The amount that you can spend depends upon how much you earn in a month. By keeping a tab, you can calculate your monthly expenditure. A budget helps you decide how much you can spend by keeping your income and expenditure in mind. It gives you an idea of how much money you can borrow if the need arises. You can make out your budget by taking out some time to do a little calculation.
What is your salary that you bring home after the taxes? This is the amount available to you to spend. Now look at the amount you spend every month. Your expenses include fixed expenses like the rent and the other utilities. You also have other expenses that vary each month like the grocery, entertainment and the telephone bills. These are expenses that depend on you and you can decide how much you would like to spend on them. In case your income exceeds all your expenses you will have some cash left over.
This constitutes your personal finance savings which can increase if you control your flexible expenses. Your savings are important for that rainy day and your budget should aim at you putting some cash away. You may have worked out your budget which allows you to save 10% every month. This is easier than you think. You may feel deprived by reducing some of your expenses and keeping off credit cards. There is help at hand if you follow some ideas of budgeting.
Forget the plastic money: It is important that you put away your credit and debit cards. A credit card can turn out expensive in the end after you have paid all the interest. The swipe of a card does not bring home the message of spending which a $50 bill will. So buy your groceries, petrol, magazines with paper money. This will give you a fair idea of the money that you are spending. After the money is over, you will start budgeting afresh. You need a reward if you have stuck to your budget with an evening at the movies or a concert. Rewards are impetus that make may sticking to a budget an enjoyable idea.
Regular evaluation and learning: You may have laid out a well planned budget. Something may come up that may disrupt your hard work. Your college going daughter needs a change in a wardrobe or you have your parent’s golden anniversary coming up. In such a case, rework on your budget to cater to the new exigencies; aiming to continue saving. Since budgeting is an ongoing process, it is advisable to keep yourself abreast with the latest in investing money. Get as much information as you can about investing your savings. You can talk to friends, read books, and watch the financial news and approach people well versed in investing money. Having a budget and sticking to it, will definitely make you feel better.