The Lucky Cabin

If you are reading this, you’re probably searching for a way to take control of your finances. The best way to do this is to produce a monthly budget and committing to it. Having a solid budget is important for managing your finances, one that has allowed me to survive even on limited funds. One of the most crucial things that I do every month is planning my monthly budget, this has allowed me to systematically meet all expenses, grow my savings, and control debt.

I map out my budget for the upcoming month close to the end of the month. This gives me a better view of my expenses in the coming month. It’s not a good idea to prepare a budget after getting paid because, too often, that flush feeling of getting a paycheck results to unessential and impulsive spending before the paycheck ever reaches the bank.

Start your personal budget by outlining all the things that must be paid that month like rent, electricity bills, insurance policies, loan repayments and telephone bills. The main idea is to apportion a budget for the things that I must pay to keep a comfortable roof over my head and carry on earning money. I like to pad these requirements to produce “money back” after paying the bills and, if costs increase circumstantially, I’m always covered.

Next, my budget is subjected to a list of discretionary things I need to cover but could live without if absolutely needed. These items include monthly savings deposits, credit card repayments, and donations to charity. These things are also essential, but in case of emergency I could put them off for a short time. By paying credit card companies the maximum instead of the minimum, I keep my credit score high and my debt low.

My budget does not include the cost of living such as food and entertainment. These things get covered by what’s left over and that’s that. Some months involve lots of beans and rice, slow-cooker meals, free or cheap entertainment, and only one inexpensive piece of clothing . This strategy of handling my monthly budget has worked out very well over the long term as long as I observe it scrupulously.