Monday, 29 April 2013

More Money Monday: Step 3

Now that you've begun tracking your spending, and have identified your goals, it's time to get started on your budget! 

Step 3: Income

Step 3 is pretty straight forward, think about where your incoming money comes from and write it down. Easy as that! It should be a bit easier than other steps because it typically stays a lot more steady and it's easier to figure out than say how much you spend on entertainment or groceries. You may need to dig through the filing cabinet or look online at your bank account to find some of the information, but once you've found it you'll be well on your way. 

To get started, use this free printable and fill in the columns, following along with the points below. 

1. List the ways that you receive money. Some typical items here would be your pay cheques, getting a bonus from work, maybe you make a little bit of money on the side through contract work, being a Mary Kay lady or somesuch, or even babysitting. 
On our budget these lines include Cass' pay cheque, Philip's pay cheque, Philip's work bonus, our tax return. We also have a line for miscellaneous revenue to allow a place for any gifts or unexpected money we take in, and a line for payable which helps us to track money that we've received but know we need to pay back out right away (say, if we earned money that hadn't been taxed, and we want to make sure we aren't led into thinking that the money we got is all ours). 

2. Calculate the amount you receive each month or year for these items. You'll find that it's easier to list things like pay cheques monthly, and things like tax returns yearly. For the annual budget, multiply bi-weekly paycheques by 26 to see how much you're raking in each year.

It's as easy as that, you now know more about your income than you did before. 

Extra Credit:

1. Now that you've tracked your income, look at your goals sheet and see if there is anything you can add that is income related. Do you want to make more money? How will you achieve it? Write these down in the "How I can drive this income" column.

If you're handy in excel (Philip is, I'm not), you can create your budget in the computer so that as you manipulate numbers you can see what it can look like with some of the differences you plan to make through your goals.

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