April Financial Literacy Month
Your budget is your blueprint for keeping cash flow positive, and for sticking to your saving goals. Even if you and your partner will be paying for expenses separately, it's essential to have one overall household budget.
Remember a budget is there to help you, and it's not written in stone. Create a spreadsheet, or use an app, to list all your anticipated monthly expenses. It can be helpful to divide them by how frequently they occur.
For the fixed expenses, such as rent or phone, it's easy to fill in the exact amount you know you'll have to spend. On the other hand, with the variable expenses, like groceries, there is no single exact amount. But based on what you know you spend, you should be able to estimate a fairly accurate number for most weeks.
The next step is to compare your income to your expenses. In order to achieve (and maintain) a positive cash flow, you may have to adjust some of the variable expenses—which probably means cutting back or cutting some of them out altogether.
You should revisit your budget on a regular basis. Remember, it's there to help you both, and it's not written in stone. Adjusting it if your overall household income changes is important. Check out this budget coach to walk you through the budgeting experience.
A part of budgeting, is saving. A simple, practical rule of thumb for individuals who want a budget that is easy to implement is utilizing the 50/30/20 rule. Play with the 50/30/20 calculator to see how much you can save.
Need more financial tools? Check out more calculators on many different financial topics.
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