When it comes to having a secure financial future, having a good budget in place is key. However, many people do not know how to begin creating such their financial map. Here are a few tips on creating a spending and savings plan. At TopTenREVIEWS We Do the Research So You Don’t Have To.™

Identify spending. Knowing where your money is going is really the integral first step. Try gathering all of your financial statements including bank statements, credit card statements, insurance statements, savings deposits, etc. Also, gather all receipts from the last month. If you do not have these, try collecting all of them for the month ahead and keep them in a safe place. Anything you have spent money on should be accounted for.

1. Gather all income information. When creating a financial roadmap you need to know exactly how much money you have coming in, so you know how much you can afford to spend on items as well as how much you can put into a savings account. You also need to know the dates that different bills are due. Using paycheck stubs is a good way to add your income to your budget. And don't forget to account for any employment bonuses, tax refunds, outside sources of income, etc.

2. Decide which time frame works best in your situation. Because some people are paid bi-weekly, monthly or on the first and 15th of each month, your budgeting time frame needs to reflect your pay dates.

3. Create your financial worksheet. By searching the internet, you can find several different types of worksheets you can download for free when creating a budget. You can also choose to create your own worksheet using a pen and pencil or try using personal finance software. In this worksheet, you should include items such as pay dates, names and due dates of all creditors, as well as other events that require spending such as holidays and birthdays.

4. Categorize your expenses. You should have two expense categories. The first category is fixed expenses – recurring payments that are always the same amount and are always due on the same day. A few of these bills include mortgage payment, utility payments, automobile payments, etc.

The second category of expenses you should have is one that includes variable expenses. These include bills that will fluctuate from month to month. Such items may include groceries, gifts and entertainment. Be sure to add everything you spend money on in this category, as it will help you later when trying to balance out your budget.

5. Sum it all up. When you have all of your data entered into your financial worksheet, add up all of your expenses as well as your income. This will show you where you are at financially. If you are spending more than you are bringing in, you need to revisit your spending habits and create new ones. If you have money left over then congratulations are in order and you can add that to a savings account and allocate it for a rainy day.

6. Review! Once you are on track with your budget, do not forget to go back and review it. Sit down each pay period, or at least once a month, and review your total income and spending habits to make sure you are sticking to your budget and looking for areas where you can improve.

It does not matter if you are trying to save up for a Caribbean vacation or a new car, having budget is important for anyone to have. It will allow you to have a good picture of how you are spending money and where. It will let you see what you can accomplish by spending your money differently as well.

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