Debt Consolidation Credit Counseling In Phoenix

To start a budget, you need to decide on either a budgeting software, using excel, or using a regular notebook and pen. Of course, using software or excel is going to be much easier for you, so I would suggest using one of them. If you have a very small budget, a notebook might be fine, but for most, software would be best.

List out all your sources of income and how much each is. Include your salary or wages for each month, tips and bonuses, interest from investments and other investment income such as dividends and capital gains, and any other income. Add these all up together and you will get your cash inflows for the month.

Then, do the same with your monthly cash outflows. Your cash outflows are everywhere you spend money. These include mortgage or rent, car payments, gas, food, clothes, utilities, entertainment, and absolutely everything you spend your money on every month. Include everything, whether you pay cash, check, or with a credit card.

By taking the difference of these two values you will find your net cash flows. If you have a positive net cash flows, this means you have extra money. Lets say your net cash flows is $500. You have $500 extra every month after all these expenses. You might normally put this into savings or investments.

When you subtract the numbers and get a negative number, this means you are losing money each month. You are creating debt for yourself. Add in the interest that your debt is continuously collecting and you are losing even more money. A negative net cash flow is bad, especially if it's a large number.

If you get a zero when you subtract the number or just a few bucks either way, you aren't going into debt, but you probably have no savings either. Sure, this is better than debt, but without savings, it's not better by much.

To keep up a budget, you need to continue to record all your income and expenses every month. After youve gone through everything and found where you can cut back, make sure you only buy where you have allowed yourself.

If you use credit cards, pay off the balance every month to avoid paying interest and make recording your expenses much simpler. Of course, the no interest is the real bonus there. If you have credit card debt, DONT PUT ANYTHING ON OUR CARD! You need to work on paying off your debt and staying away from more!

Follow your budget every month whether it be in a notebook or using software. Always be aware of where you are spending your money. If you dont need it, dont buy it! Instead, save a small portion every month for fun money. Having savings accounts for vacation funds, car funds, and any other types of funds are a great way to compromise between getting what you want and staying financially secure.