Make a Personal Budget
Current Economic Recession Tip
To make a personal budget involves using strategies to save money to stay out of the current economic recession.
I do not like recessions. I do not like economic "downturns". I do not like having to panic about paying bills, putting food on the table or when I will be laid off work.
Because of this, I have decided not to participate in any of these activities. You heard that correctly: I choose not to participate in this current economic recession. I participated in one in the early eighties and did not like it, so I am done with them.
It has been oft repeated that a recession is when someone else loses their job and a depression is when you lose yours. We panic over all of the possibilities that MIGHT happen.
Well, what if you did not have to worry about all of this? Continuing this "what if" game, what if during your abundance and prosperity you learned how to make a personal budget and was able to plow money away in a savings or short term investment account? You see where I am going with this. What if you ignored the hypnotic advertisers, stopped all of the wild spending, made wise spending decisions, and kept plowing money away until you had six months to a year of basic living expenses saved and ready to safely guide you through the upcoming recession? (There is always one gearing up to bite you -- it is part of the normal business cycle.)
Freedom comes when you create a personal spending plan.
This idea works whether you earn $20,000 per year or $100,000; the principle is the same: Live on less than you earn and save for the time when (not if) you lose your job or have a downturn in business.
Your mortgage consumes half your income you say? Get rid of it. Eating out? Stop it. Have cable? Goodbye. Spend that mindless time developing a small Internet income stream. If you sit down for a few minutes, you can think of MANY strategies to save money, thus giving yourself little "pay raises."
In the immortal words from the Dave Ramsey Show, "Live like no one else so later you can live like no one else." Read that again and sit there for a few minutes until the smile forms.
Learn about one family's journey to frugal living. Frugality for Today shows young families how to achieve this lifestyle by controlling spending and living well within your means.
Time for Action
Get a a pencil and paper out and make a personal budget. Write down your take home pay for a month and a list of all the expenses that need to get paid. List 10% of your take home pay as an expense you pay to your savings account.
In the last article in this series, you will get a down to earth nuts and bolts approach. For now, just write down a basic list.
When you have caused your income and expenses to equal, you are become ready to continue your journey to achieve financial freedom.
You become ready to soar and stop participating in this (or another) recession.
Ready to Move On?
The last in this making a budget series has a video walking you through the different personal budget categories.
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