Are you ready for a financial revolution? If you've set a budgeting goal, here's a crucial step to help you achieve it. This isn't your average tip; it's the result of years of education, experimentation, refinement, and a commitment to financial success. When we hear the words budget, money, or expense, it's easy to feel overwhelmed, but trust me. We'll get them all on the page, then tackle each methodically.
Fixed vs. Variable: The Game-Changer. This month, take a moment to identify all your expenses as you split them into categories. It's a simple yet transformative step toward a successful budget and it starts with becoming more aware of your expenses.
Step 1: List out all your expenses.
Step 2: Categorize each expense as fixed, variable, or infrequent.
Fixed Expenses: For your personal budget, consider fixed expenses as commitments that require drastic steps to stop, such as mortgage/rent, subscriptions, utilities, insurance, and regular donations to charity.
Variable Expenses: Variable expenses are expenses you must take action to incur, like fueling your car, ordering groceries, or dining out. Unlike fixed expenses, these generally occur multiple times a month and demand more detailed budgeting to track effectively.
Infrequent Expenses: Ever wonder where to fit those occasional expenses like yearly Amazon memberships or once-in-a-few-years tire purchases? The one thing infrequent expenses have in common is that they happen infrequently enough to take your meticulously planned budget by surprise.
Are you intrigued? Ready to dive into a new era of financial empowerment? This is your opportunity to leverage my accounting expertise— ask questions and share comments as we navigate the world of personal finance together, paving the way for a financially empowering tomorrow.
Use this free Excel download to get started! And stay tuned for next month's installment, where we'll unravel the intricacies of creating a budget for each type of expense, supporting you on your journey to a more prosperous and organized financial future.