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How to Create a Budget

Any experienced bankruptcy attorney or accountant will tell you that one of the leading causes of personal bankruptcy is that individuals frequently fail to create and adhere to budgets. Building a personalized budget can be tricky enough, but most people who take this important step towards financial stability are unable to follow through because they do not take the proper steps in creating their budget. The good news is that help is available. With a little discipline and a few easy steps, you can develop a budget that preserves your paycheck and meets all of your needs.

Three Simple Steps to Creating a Budget

Managing money can be a tricky thing, especially with the frequent use of debit or credit cards. Many people do not even register payment below ten dollars made with cards. Of course, small payments add up quickly and you can find yourself in trouble before you know it. The best way to avoid this is to keep a strict budget that accounts for every bit of your money. Use the following three steps to make your budget and begin saving your money today.

  • Keep track of your money. Hold on to your receipts for a month, and use them at the end of the month to help you with step two.
  • Categorize your expenses. Make a list of the different things you’re spending money on, and group similar expenses together. Include categories such as bills, groceries, shopping, entertainment, and gas. Once you group your receipts, tally up how much you’re spending in each area. This will help you get an idea of how much you spend on things in your life. Set a cap on how much you want to spend on each category in the future.
  • At the end of each month, review your spending to make sure you’re sticking to your budget. If you notice that you’re consistently coming in above or below budget in one area, you can adjust your expenses to compensate.

Budgeting your money can be tough because it is tedious work that requires discipline. However, taking this step is important to the process of financial recovery.

Contact a Bankruptcy Attorney

The lawyers at the offices of Ryan J. Ruehle Attorney at Law, LLC, know that budgeting and managing your money does not always work to prevent dire financial situations. If you find yourself struggling to maintain a budget, call us today at 513-621-0999 to discuss your options.

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