Module 1: The Budget

Module 1: The Budget

The first step to creating a financial plan that works starts with a Budget

The Lesson Blueprint

What is a Budget?

Setting up a Budget that WORKS for you

The Pencil and Paper Budget

The Spreadsheet Budget

Irregular Income Tips

Rookie Mistakes

What is a Budget?

A Budget is Simply Telling Your Money What to Do

A Budget is What You Make It

What ELSE is a Budget?

A Budget allocates your money BEFORE you actually spend it

A Budget is your “Gas Gauge” for your Money

Zero Based Budget?

Allocate all of your money on paper BEFORE the month actually starts

This is your Money Road Map for the next 30 days

Step #1:Determine Your Income

How much do you make each month?

How much do you BRING HOME each month?

How often are you paid - weekly, 1st/15th, bi-weekly, monthly?

Consistent Pay or Irregular Pay?

Irregular Income

Self-Employed, Sales, Commission Only?

Look back over past 90 Days

Error on the Lower End of Income

Irregular IncomeExample

January = $5,000

February = $0

March = $11,000

90 Day Average = $5,333 or less**

Step #2:Setting up Your Own Budget

START: What have you been doing with your money?

Track your Spending over the past 90 Days

This is going to be Painful (only once)

This may shock you!

Step #3:Start Categorizing

Mortgage/Rent/HOA Fees

Groceries

Gas (for your cars/trucks)

Utilities (Electric, Gas, Sewer, Water, & Trash)

Going out to Eat & Having Fun

Clothing or any type of “shopping” Nordstrom to Home Depot

Step #3:Start Categorizing

Personal Care – Hair, Make-up, & Gym Membership

Insurance – Medical, Dental, Auto, Home, Renters, Life, Disability, Umbrella, etc.

Cable, Satellite, House Phone, Internet, Hulu, Netflix, Satellite Radio

Cell Phone

OTHER

Step # 4:

Choose Your Budget

Pencil & Paper

or

Spreadsheet

Step #4a: Pencil & Paper Budget

Pencil & Paper Tips

It isn’t going to be perfect the first go around

Use a Pencil!

Step #4b: Spreadsheet BudgetVery Easy to Use

Does the Math for you!

Works for Mac & PC

How To Video in the

Resources

It’s Just Simple

Step #5: Follow the Budget!

You created it, you follow it

Change your Behavior with Money

It’s 5th Grade Math

Irregular Income

Going back to the $5,333/month income

Your budget “NEEDS” requires: $5,100/month

When More Money Comes in, add that into the

“WANTS” (or needs) of the Budget

Irregular IncomeExampleNeeds:

Groceries Mortgage/Rent

Gas Utilities

Clothes Insurance

When Extra Income

Comes in, add that to

whatever is below the

“line”

Go as far down the list as

you can until you run out

again

= $5,100

= $133 + Any Extra

Debt Payoff

Vacation

“Stuff”

“More Stuff”

Rookie Mistakes

You get overwhelmed and you quit

The Budget is your Guide, it doesn’t CONTROL you

It isn’t perfect right away

Expect the unexpected

Top Notch Budgeting Tips

You will need to keep a buffer in your checking account

Emergency Budget Meetings

Receipts, Receipts, Receipts

Use Cash for Groceries, Dining Out/Entertainment, & Clothing/Shopping

This Stuff Really Works

" Since we’ve been married, we have never truly monitored

our incoming/outgoing finances…until now! I love coming

together to negotiate our envelope spending and trying to

prioritize where we want to spend what for each month

depending on what is happening with our family."

- Amanda | Phoenix, AZ

Wrapping Up

If you don’t do a budget, you will not see progress

Remember: You Created it

What would it feel like to get a raise?

Be Patient

In the Next Module…

Why Do You NEED to Save Money?

How Much Should You Be Saving?

Where Do You Park Your Money?