HOW TO Create a
SPENDING PLAN
Do you find yourself living paycheck to paycheck? If your car were to break down, could you afford to take it to the shop? The sad answer is most people do live paycheck to paycheck and cannot afford to repair their car in the event something happens.
Life’s surprises alone are a good reason why we all need a Spending Plan. You Will Find In This Issue: Benefits of a Spending Plan How you can benefit from a Spending Plan.
10 Reasons Why you should implement a Spending Plan.
Benefits of a Spending Plan
A Spending Plan will help you:
While it may sound restricting and unpleasant, following a spending plan will allow you more freedom to fulfill longterm goals like purchasing a house, paying off debt or building a savings. You say “Budgeting is too complicated” or “It takes too much time” – that is not necessarily true. Utilize the provided Spending Plan Worksheet (you should also have one provided separately in your workbooks) and you will see just how quick and easy it can be. The rewards of implementing a Spending Plan tremendously outweigh any time you will spend creating it. And the longer you wait, the longer you deny yourself the sense of well being that results from being in control of your finances.
1) Create the awareness of the direction you are going in. 2) Control your money instead of your money controlling you. 3) Meet savings goals. 4) Limit spending on things you don’t need so you will have money for things you do need. 5) Enable your family to achieve common goals. 6) Be prepared for emergencies. 7) Improve your marriage with fewer arguments about money.
Spending Plan Worksheet
8) Define areas where you were over-spending.
Located on the reverse side.
9) Get out of debt or stay out of debt. 10) Attain peace of mind knowing you will be able to make ends meet and more!
SPENDING PLAN WORKSHEET 11) List INCOME & EXPENSE Categories
1
Income Sources
2 Record Actual Monthly INCOME & SPENDING2)
NAME: 3
Calculate and record the DIFFERENCE by subtracting the Total Monthly Gross Income at the bottom.
6
Determine and record your FINAL EXPENSES by subtracting or adding each Adjustment and total the column.
4
Decide the TYPE of EXPENSE: Fixed, Variable, or Discretionary. Record each expense in the appropriate column and total each column.
7
Assign who’s responsible for paying each Final Expense, between HUSBAND and WIFE and total columns. (Skip if single.)
8 5
Make needed ADJUSTMENTS to balance your Income & Expenses. You shouldn’t adjust Fixed Expenses.
Record the portion of Total Gross Income you receive by PAY PERIOD.
1010) Monthly Plan-SUMMARY Prior Month ACTUAL
1st Month ACTUAL
2nd Month ACTUAL
3rd Month ACTUAL
Husband’s full-time job Wife’s full-time job Dave’s part-time job Child Support
9
Decide which Expenses to pay with each PAY PERIOD and total columns.
10
The end of each month complete a SUMMARY of your actual Income & Expenses.
Stock Dividends
88) Gross Income by Pay Periods Period #1
Period #2
Period #3
Period #4
Total Monthly Gross INCOME 1010) Monthly Plan SUMMARY 1
EXPENSE Categories
Price Month ACTUAL
1st Month ACTUAL
2nd Month ACTUAL
3rd Month ACTUAL
4 TYPE of Expense4) Fixed
Variable
5 Discretionary
Adjustment
6 Final Expense
7 Who Pays Expenses7) Husband
Wife
9 Pay Expenses by Pay Periods9) Period #1
Period #2
Period #3
Pay Yourself Taxes (Total all) Husband’s Personal Wife’s Personal Help Fund Auto Business Expense Children/Child Care Contribution/Charity Dining Out/Fast Food Education Food/Household Items Gifts/Cards Grooming Housing Insurance Leisure Medical/Dental Other Payments Record Keeping/Postage Utilities Vices Wardrobe
TOTAL Monthly Expenses 3
DIFFERENCE
99) Total EXPENSE by Pay Period (Below) Balance Adjusted EXPENSES with INCOME
PAY THIS
Period #4