Seven Steps to a Successful Budget

SOURCE: GREENPATH FINANCIAL WELLNESS

Budgeting can be a simple and straightforward process. It can also be a rewarding experience when you involve all family members. But, it takes interest and commitment.

Here are seven steps to help you create a successful budget.

  1. Discuss Values – Determine what is most important to the people involved in your budget, or spending plan. By understanding these values, you can make decisions that will provide you with the most satisfaction.
  2. Set Goals – Begin setting goals by discussing with family members what each one may want to do with their money. An example of a goal might be to save for a child’s education. Have each member list the goal and a deadline. Work on the most important goals first.
  3. Put Money Aside For Your Priority Goal. – To achieve your unique goal, treat the money as a bill to be paid to you.
  4. Determine Income – Figure out your net pay, or the money that is left over after deductions. The money that makes up your income can come from sources such as salary, allowances, social security or child support. Do not include overtime pay.
  5. Determine Expenses – What are the expenses in your budget? Consider fixed, variable and periodic expenses. Fixed expenses consistently stay the same every month, variable costs vary from month to month and periodic bills are those not due every month.
  6. Create a Plan – Design a spending plan so that your income will allow you and your family to have what you want and need. If you find that your income does not cover your expenses, re-evaluate your plan and decide what categories to change.
  7. Keep Track of Expenses – Keep a record of bills to see where your money is spent. By comparing your estimated expenses with your actual outlay, you can evaluate whether your plan is working.
  8. Evaluate Your Plan – Periodically assess your spending plan. Is the plan still helping you meet your needs and achieve your goals?

Budgeting is the cornerstone of a financial plan and a guide to help you achieve your goals.

As a member of First United Credit Union, you can take advantage of the GreenPath Financial Wellness program, a free financial education and counseling program.  GreenPath counselors are available Monday through Thursday 8 a.m. to 10 p.m. (EST), Friday 8 a.m. to 7 p.m. and Saturday from 9 a.m. to 6 p.m. To use this service, call 877.337.3399 or visit www.greenpathref.com.