0 Spend

This is way I do mine: After you get your paycheck,pay all the important bills first (mortgage, Car, utilities, credit cards) then the non-important ones (like magazine subscriptions, cable TV, etc.), then allot so much for groceries and necessities, then whatever you have left you can use for clothing, shoes or put away in a savings.
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I’m not crazy about budgets however I do believe we need to know where our money goes and how to improve our financial situation. I have created a home expenses spreadsheet which you can download free from Microsoft.com. I have a clear idea of my regular fixed and variable expenses: Rent/Mortgage, car loans/lease, food, gas, electric – you get the picture. I make sure that my expenses don’t exceed my income and I fund each month for charity and savings.

I like to use a credit card to pay for everything I spend money on for two reasons – (1) it creates an automatic record for me on where my money is going and (2) it allows me to earn something in return (cash back, mileage, free something). I pay off the credit card in full each month. I make sure my money is earning the highest rate possible out there. I like the current rate for savings with HSBC.com. I hope this is helpful.

I work with folks who are interested in becoming financially healthy. Feel free to email me if you have any further specific questions on this.
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Run your house just like a business.

Pay yourself first (savings account, etc.)
Pay rent/mortgage
Pay utilities
Pay for food
Pay extras
what’s left, add to next month’s payroll to yourself.
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The first thing you need to do is sit down and figure out what your expenses are. What are the bills you *have* to pay:
rent
electric bill
food
gas
car payment

These are all non-discretionary bills

Then subtract your total monthly non-discretionary spending from your total monthly income, this number is what you can use on discretionary spending. Then agree on a personal spending allowance (play money) for each of you that you can spend each month. This can be used on food too. You can calculate how much money is the minimum you can spend on food and exist and then set up a discretionary food budget for when you want to splurge and eat out.

The link below is a great link to an excel spreadsheet that helps you calculate this. Just plug in the numbers and it does the rest!
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http://office.microsoft.com/en-us/assistance/HA010450871033.aspx

I actually use an Excel spreadsheet. Sounds crazy, but if you look at it like a basic income statement, it’s very easy and makes sense. Take your net income at the top. Subtract all monthly expenses, and you should be left with hopefully a positive. I also keep my check register in Excel. This is a great way to look at what I’ve spent my money on. Debit cards are convenient, but can also be dangerous!
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PAY YOURSELF FIRST!

Whatever your paycheck be, take 15% of it and invest it. Pretend it never existed. Next pay your rent/mortgage (you don’t want to sleep in a telephone box, I tried it, it’s no fun). Next pay your utility/cable/TV bills. If you don’t have enough, get rid of some of them. Take half of what’s left and put it in an envelope. Use the rest to feed your family. If you run out of food, go in the envelope. If you don’t, waste the money in the envelope on something you really like to do.

Go forth & prosper!
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