Living a Better Life
(featured column... from the editor's desk)
Keep Your Budget Current
by Michelle Jones
It may happen in
January or February, or maybe not until June, but your financial situation can
change any time throughout the year. And most likely will. It’s important that
your monthly budget plan reflects these changes and stays current. So at some
point during the year...
*
* *
You’ll need to update your budget!
Your updated budget will need to include any increased or decreased income,
and/or any changes in the expenses or payments going out. It will also need to
reflect your short-term and long-term financial goals, such as saving for a down
payment on a new house or college tuition for your kids (or yourself!) If
you’re paying off debts, you’ll need to adjust those items as well, since
they should be getting smaller and smaller every month. (See my special report
on Dealing with Debt
for more help with that issue, it’s currently available for free to
subscribers of The Money-Saving Tips E-zine.)
We update our family budget every quarter, as things are always changing for us.
Whether it’s a job change, new activities for the kids, car repairs or a new
set of medical bills coming in, we make adjustments wherever they’re needed.
If we didn’t make changes to our budget plan throughout the year when these
things occur, we might spend the extra money that’s needed to cover the extra
expenses or reduced income.
My favorite budget planning system is a simple one, I like to use a green column
ledger and each page holds 4 months of our budget. After 3-4 months I find I’m
ready to make a small change here or there and will transfer it to a new page. I
keep the old pages to refer back to later in the year if needed.
This simplified system could easily be done on the computer as well, but since I
work online full-time, it’s actually pleasant to hand write the budget out on
paper. I also like to take some time to review our budget each month, to make
sure everything is going where it should. I keep the ledger with our incoming
bills in a basket on my desk and sit down once a week to send everything out and
take care of any miscellaneous items like subscriptions and insurance.
Having a set "pay bills" day once a week will help you keep your bills
up to date, but just remember to keep your budget up to date as well.
Copyright 2002 by Michelle
Jones
