Personal Finance 101: How to start budgeting

Why budgeting? that’s the thought that comes to mind whenever professionals are paid at the end of the month.

Whenever the salary drops in the account, all kinds of expenses come to mind. Sometimes, you always think “after all next month’s salary go happen so why I for plan for the month.

I am sure there have been cases where you urgently need money but because of your overburden expenses, there is no cash to help you sort out issues.

Here are are some few tips to help you budget even with the little GHS 500 salary.

  1. Write down things you need for the month;

After you get over the horror of your daily spending, the next step is to go on a virtual shopping spree.

Make a list of what you need to buy or do over the next three to six months. These could be physical purchases/

Voila! You have a “spending plan” (so much nicer than the word “budget,” don’t you think?).

Meaning every time you whip out your wallet, you have a tangible list of money goals to help drive your spending decisions and propel you financially forward. Bonus points to those who make a laminated wallet-sized version of the list for everyone in the family.

List five uses of your money that will positively affect your life in the near-term and the long-term. Then, list five uses of your money that will add little to your quality of life in a decade or more

2. Do Some Simple Division

With your money goals in hand, pencil in how much each item on your “wish list” is going to run you on a monthly basis. Simply divide the total amount for those new tires by the number of months until you need them. Magic, no?

3. Stop Mindless Overspreading;

Come up with a reasonable weekly amount you’ll allow yourself to spend in your biggest categories. (Those are typically “food” (or, depending on your lifestyle, get more specific such as “lunch,” “family dinners out”), “entertainment” (e.g. happy hours, movies, tabloids to pass the time), “transportation” (gas, parking, taxis, public transportation), “apparel/services” (dry cleaning, bangs trim, cute shoes.)

I am sure this would help budget for tomorrow.  Thanks and can not wait to share more with you.