Budgeting...eek!
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Budgeting...
We all have to face it at some point.
When was the last time you filled out a detailed budget? If it's been a few years or if you never have, you've been neglecting one of the most powerful ways to help you improve your finances. How many of us look at our bank accounts at the end of the month, just to wonder where it all went? Without a budget, you may never know, or be able to stop that from happening at all.
The process is really quite simple: write down all your sources of income, including earned income, self-employed income, family income, government income, retirement income and investment income. Add up all of your income to get your Total Annual Income.
Next write down how much you spend in fixed expenses (auto-related, home-related, insurance, taxes, utilities, etc.) and flexible expenses (kids, clothes, donations, food, maintenance, medical care, recreation and entertainment, etc.) Write down as much as you can possibly think of. When you add up all of the Expenses, you will arrive at a Total Expenses figure.
The final step is to take away the Total Expenses from the Total Income to determine your Total Positive or Negative Cash Flow. This is like taking a photo of where you stand financially. If you find yourself stuck in Negative Cash Flow, you must increase your income, reduce your expenses, or make some sort of combination of the two to prevent falling into major financial trouble (which eventually jeopardizes your credit rating). If you are in Positive Cash Flow, look at how you can maximize the return on the excess cash you are generating.
One of the biggest problems in many people's budgets is what I call the "Mystery Cash" syndrome. You take $100 dollars out of an ATM machine and it's a total mystery as to where you spent that money. Track where you spend your money, and cut down on the mystery cash.
Don't wait any longer to take control of your finances. With your budget in hand, you will now be able to take control your financial destiny.
Another opportunity to increase your Positive Cash Flow is by reducing your interest rates. How? Simply contact your creditors and request a reduction in your interest rate. If your creditors can't based on your credit score, it's probably a good time to contact Platinumcredit.info |
Closing Notes
| Thank you for reading this month's newsletter We'll see you again next month. |
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