Tithing is a command brought to us in the Old Testament and mentioned again as a something Christians should do in the New Testament. Once you have determined your budgeted income, you can move on to tithes and giving. Another way is to track your hours and multiply it by your hourly rate to determine an estimation for your upcoming income. An easy way to work through this bump in the road is to look at previous income for pay periods and take the average of those to estimate what your income will be this coming payday. This can occur when a person is paid by the hour, by the contract, or by commission. This should be treated as income, not random money that comes into your wallet and right back out.Ī common technical issue is that some individuals do not know what their income will be before they receive it. This includes $5 you find on the sidewalk. All that money that comes to you should be considered income. Determine all types of income you will receive such as wages, gifts, refunds, etc. This is crucial because you are not tempted to spend your earnings before creating a plan for how you really want to spend them. Determine IncomeĪ key element to preparing a budget is to do so before you actually receive any income, so before your next paycheck and before the month begins. That’s really what budgeting is all about creating a plan to accomplish your goals, hopes, and dreams. If you implement your goals into your budget, you maximize the potential of accomplishing them when and how you want. Some of these goals should be saved for (education and travel) while others need to be paid for (home and cars). Common goals include purchasing a home and/or car, earning a degree, owning a business, writing a book, vacationing, traveling the world, and many more. Short term and long term goals are important and will play a part in how you create your budget. Pete Benson Preparing a Budget Establish Goalsīefore you write out your budget you need to write down your goals.

“ A written spending plan for your money that includes giving, saving, and spending is essential to achieving financial freedom.” - C. For some, writing may mean keeping a digital copy or using an app, for others this looks like physically writing down budget with pen and paper. Many bills such as housing costs, utilities, subscriptions, and more are due on a monthly basis so the typical budget is prepared for an entire month.īudgets can come in all shapes and sizes, but it is important that all budgets are written. Basically, a budget is a spending plan that maps out the amount of income versus the amount of expenses during a specific period of time. More specifically, it is the “amount of money that is available for, required for, or assigned to a particular purpose” ('Definition of BUDGET', 2021). Your resource is your income and your expenditures are the purchases you make. Put simply, a budget is “a plan for the coordination of resources and expenditures” ('Definition of BUDGET', 2021).

Common household budget percentages