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Podcast Episode 21 — Keeping a Household Budget
Keeping a household budget is necessary if you want to have organized finances. It’s the best tool to see at a glance what money is coming in and what money is going out — and exactly what the money is paying for. It will also help you identify if you have any money left over at the end of the month that you could put into a savings or investment account.
If you’re not currently keeping a household budget and tracking your income and expenses, you may be spending more than you’re making. If this goes on for a while, you can find yourself in serious financial trouble. Also, it’s really easy to spend more than you realize on clothes, eating out, or other entertainment expenses if you’re not keeping track. We don’t eat out a lot, but even I was surprised when I started tracking how much we were spending on dinners outside of the home.
Having a budget gives you more control over your money. It allows you to make smarter choices about where you want to spend your money — or not.
In its most basic form, a budget is simply a money tracker. You record where the money is coming from each month (your income sources), and then you record everything you’re spending the money on. Start with your regular monthly bills like your mortgage or rent, car payments, insurance, utility bills, et cetera. The amount left over after all…
