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| You will find a chart, that when completed, will give you
a visual picture of what you can and cannot do. |
Recognize
that the monthly costs that are not fixed will give you the discretion
of using it how you wish. HOWEVER, you MUST allocate (set aside,
put in the bank, and not touch) a percentage of your monthly income
that will allow you to pay your debt when it is due. Keep a calendar
so you don't miss a deadline.
Now
that you are getting the picture, this is how simple it is:
If your income provides more money than your expenses,
you have money left over. You can put it in savings, invest it,
take a trip, or more realistically go to the movies or maybe just
buy an ice cream cone. You are doing fine. You owe nobody anything.
You win!
However...If the total of your expenses equal more
than your income, reality sets in immediately. You are not winning,
yet! This is why we plan budgets ahead of time. By recognizing the
fact that you will be in debt if you lead your lifestyle as you
planned it, you have to make provisions to do one of two things.
One, earn more income.
Two, reduce your expenses
by eliminating costs for items that are not fixed or absolutely
necessary. Be assured that it is impossible to hit a bull's eye
in every category. You will discover that other than the fixed costs
you will be constantly juggling to use money in one category when
it is not needed in another, hence managing your money.
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