How to Start a Basic Budget During a Recession

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By rumblebug
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Start a Basic Budget During a Recession

It can be intimidating to start a budget but especially so during bleak economic times. Although it may sound scary, starting a budget during a recession can be your best tool in avoiding debt and desperacy.

Difficulty: Moderate

Instructions

Step 1

GET YOURSELF SORTED - Look at your outgoing bills each month and start a list with two columns. The first column will have the bill type or name and the second column will include the amount due each month (approximate is okay). You can also make note in a third column of the total amount due for each bill. Start with your biggest and most important expenditures like rent, mortgage, insurance, or car payments, then list each bill in descending order of importance. The list should end with the extra, frivolous spending like subscriptions to websites, cable, gym memberships etc.
Step 2

FIGURE OUT YOUR INCOME - Make note of your income for each month. Make sure to take into account any alimony, child support, dividends, Social Security, Disability, etc. Total the income and then subtract your outgoing expenditures from your income. The money that is left over is your spending money for household items, groceries, and discretionary spendng (fun stuff).
Step 3

NOT ENOUGH MONEY LEFT OVER? The scary part of starting a budget during a recession is when there isn't enough money left over after the monthly bills are paid to buy groceries or needed household items. But there are things you can do about it. Making your budget forces you to evaluate what monthly bills are really eating away at your income. Are there expenditures that you can cut back on? Refer to the resources listed below to cut back on your monthly bills and increase your take home money.

Comments

Imagination said

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on 2/10/2009 I've always made more than I could spend, now I find myself barely making neds meet. Thanks for the tips now if you could just tell me how to handle my check books. Yeh crazy I know but I must have three spread out between the hous,e, my car and purse. Balancing a checkbook another new thing fro me to learn.

arianacherry99 said

on 1/28/2009 Good tips and suggestions. This is something so many of us truly need during this rough economy... Thanks for writing.

MommyBear said

on 11/25/2008 Very true. Excellent article. These are great tips on starting a basic budget. Evaluating where your money goes is important to figure out whether or not you need to save money. Thanks! :) 5*****