Topic: The steps to follow in creating a budget (Read 692 times)

To take steps related to money, you have to really consider it, like I once wanted to buy the latest watch, but because I have limited income, I still have a watch that still has the same function to see the time, so I considered it first, because I felt that even the watch I owned could still be used and still function normally, therefore I didn't buy the newest watch, because there are people who when they see the newest product they will immediately buy it without considering it. all is well, taoi yes maybe that's true because they have more income therefore they buy things they shouldn't buy (not that important).

In my opinion, there are many people who have little or limited income but their expenses are large so they have problems with their finances, well, as I said before, however, I think if they record their finances, maybe it can help them with their financial problems, and also they must be able to reduce unnecessary or unimportant expenses to reduce their own financial problems.

It's true that many people can't do this, because I myself couldn't do it at first, but when I realized I had a problem with my finances which always ran out somewhere, in the end I decided to record my expenses and the good thing is that this had a good impact on me, where My finances are also monitored with my expenses becoming regular. That's true, even though this is said to be small, in my opinion it is quite important, because this small thing can help us become better individuals in managing finances, especially if we have limited income then I think we should do this small thing.
That makes sense, maybe it's true that this is the first step, and also with this we can be aware of other things that must also be paid attention to in managing our finances. because as far as I know there are many people who have limited income but they are still wasteful with managing their money but they don't care about that, maybe they feel that youth is a suitable time to spend having fun by spending all the money they earn, even though they also have a future to look at, if they continue to be wasteful then they will have no preparation for the future.

I think the most ideal points on the list is the first and last.

Having to determine your income and
Reviewing your budget after it’s all outlined.

The first could as well accommodate every other point on the list as, in determining your income, in amount, in the time of arrival, you could as well appropriate uses and what you could archive with it using a scale of preference and urgency.

While, reviewing ensures your not making any mistakes and that you’ve set out achievable goals and not goals that would need you up, trashing the budget. If you can archive this two, you could be as well, good to go on a budget.
Also, you might make room for budget surplus due to inflation. It’s more real now than ever!

It can't be done but it must be done.
However, someone who does have good financial management will not forget this trivial thing because this is something important as a first step for us to see the level of economy we have.
Recording expenses is sometimes not paid much attention to by some people because they think that things like this will be troublesome but instead things like this can be an evaluation for ourselves if we expect a stable economy because after all this becomes very important for us to know the level of whether we are wasteful or not and to rethink that what we do in spending money is correct or not.
Indirectly, this is the first step for us to know what steps we should take in the future as a form of evaluation today.

Dont buy on something which isnt a priority or something not that relevant on day to day living but since we are just human beings and have their own interest and likings or desires then sometimes it cant really be just avoided for you on not to have those kind of wishes and sentiments on where you would really be that definitely be forgetting into sticking into your budget. Its not bad on doing it for sometimes but it would be better that you should be avoid it if you are really that on strict budget. There's nothing wrong to buy or do such things if you could really be able to afford on doing so, but if you are really just that earning sufficient for your day to day living then it wont really be that ideal on taking up such step. So it would be always best that you should really be that mindful about on the steps that you are making.

Budgeting might sounds easy but doing the actual thing would really be hard specially if you are the main provider and does have that less income source but your expense is way too much
then you would really be needing to be wise on your spending or else you would really be ending up on having those huge problems because of having that overdropped condition.
This is why it would be always recommended that you should really be that strict into that sense.

  Of course, it's just common sense that if we don't have a source of income, how can we budget money? So in today's time, our only source of income is not really enough. That's why others, even if it's a small business, will do as long as they know within themselves that they can grow it eventually.

  and this bitcoin trading or crypto trading is also one of the additional sources of income we can use, as long as we know how to use it correctly in our lives and even in the future.

It's true that we have to be able to avoid excessive spending, such as buying things we shouldn't buy, because in my opinion, many people have the habit of buying things they shouldn't buy. This is because they prioritize desires that must be achieved, and don't think too much about basic needs that they should have fulfilled, in this way they tend to experience expenses that shouldn't occur because they follow the feeling of what they want.

Apart from that, in my opinion, recording expenses can be done so that we can see where the money we spend is going, because there are people who have large incomes but within a short period of time their income has decreased a lot and as a result it makes them confused because they don't record expenses. This needs to be paid attention to because in my opinion this one thing can also have a big impact if it is done well, I myself have felt it where I have experienced the thing I am telling you about and it turns out that not only I, including many people in my environment, and in Finally, I decided to record my expenses so that I could monitor them well. As a result, with this action, my finances were well controlled.

I agree with your opinion it is very important I think in determining income and making a realistic budget, separating and recording expenses that are prioritized is very important and even helps in controlling finances better, I admit that if there are mistakes in the budget can cause problems for finances even to serious, I think this needs to be followed up and find solutions to overcome unwanted economic difficulties

Having a budget and sticking to it, helps you to plan, prioritize, avoid overspending and to achieve your financial goal. Number two on the list is very important. When running a budget you should be able to tell where most of your expenses are heading to. For instance, If you discover that the operational cost of running a business is more than what you're getting out of it, then you've to decide whether you've to pull the plug and try something else.

This is the first step towards success because if we spend whole income without realising that in which activities it has been used then we will not be able to save any amount even it will become difficult for us to fulfil our expenses in an accurate way.

Analysing your salary budget and then divide it according to your expenses in different percentage will help you to not spent your money in unnecessary things. One should not think that hard situation will tell him before arising therefore try to be ready for all the situations and save some amount in advance as you can feel need for it anytime.

Even if you are a freelancer and your monthly income is not stable, it is better that you have your own way of saving your money. In fact, freelancers earn even more, especially now that VA's work types are in demand. Just continue the method that you're doing so that you can get used to and practice well saving your income from freelancing.

You prioritize matching spending and income in your budgeting, which is detailed and practical. It's important to thoroughly evaluate your income, not simply its amount but also its consistency and dependability. A more flexible budget is needed for side gig income. Tracking spending requires classification and noting changing costs like seasonal utility bills and irregular expenses. Finding a balance between fixed requirements and variable pleasures keeps your budget sensible but flexible.

Setting feasible goals requires distinguishing wants from needs. This distinction helps prioritize expenditure and make better financial decisions. Emergency reserves are a good idea; they're a requirement in today's volatile market. As you said, evaluating your budget regularly is like a financial health checkup; it helps uncover overspending and allows timely modifications, keeping your goals on track and feasible.

The first point is only applied for people who has fixed salary/income, As a freelancer that doesn't have fixed income or salary for each month, what I do is fixing my spending. I dedicated certain amount of money for entertainment, lifestyle and anything that is not my basic needs, if not most of the time, this spending will be come uncontrollable.

Denying is what you mean delayed gratification. All of those you've mentioned that someone wants to have at the same time as an achievement for his/herself is what we're all aiming for. IMHO, if you're able to do all of these things and you don't to sacrifice and your financial status is well and stable, you can enjoy it all the way. But if you have budget constraints, definitely that you should apply delayed gratification. It helped me a lot and I am still doing it until now, even if I want something and I can avail it rightaway, I am still thinking many times if I need it or not.

Yes, it is not easy but your experience and life struggles will teach you all the way naturally with all of these. You are working to live not living to work. And by that means, you save, invest and enjoy as long it's in line with your budget and lifestyle.

Having good plans and budgets is good, they are such ways that keep a person in check but the person must be ready to take responsibility and deny himself for this to be possible. This is of course for certain reasons which are mostly beneficial in the end. It may be for retirement savings, project execution, better living, vacation, property acquisition and many more. That is why the end must justify the reason that one is doing it, and this alone is a good reason for the person to make sure that it is done as planned. However, the major issue with budgeting is the availability of resources, if the resources are flowing very well, actualizing a budget is not an issue, but if the resources are scarce, it might be a tougher task than expected.

Regardless, if you plan it well, you achieve it well, and you must know that it is not going to be easy. You have to stop some frivolities and I do not believe in compulsive buying except if necessary. This doesn't still mean that the person must be strigent with it to the extent that it will be so negtive to the standard of living. But to a somewhat level that will make the person responsible, committed and accountable for the proposed goal to be possible painstakingly or not.

Apps? I personally use Excel, as I think most people do. The budget is best done sitting on your computer but if you are looking for apps to do it with your mobile, there are plenty. There are also some that track expenses if you pay with debit or credit cards but I use cash as much as I can, so I don't use them.

Very good post and it can surely be useful for those who are finding it difficult to manage their money and honestly, it's a very common issue these days. A salaried person will always face issues managing their finances because they wait a whole month for the money and in that time, they are planning and delaying all the things that they need or want to do because they don't have money for it and when the money comes, they just start doing all the things that they have planned without creating a proper budget for the expenses.

The steps you've described should be used by such individuals so that they can plan and track their expenses in a good way and don't spend all their money in the initial days of the month and then become compelled to borrow money from others because they can't spend so many days without any money at all.

It's true, because your calculations will only have a real effect for longer when prices are more stable. On the other hand, when we live in countries doomed by uncontrolled inflation, prices of goods and services skyrocket in a daily basis, so we can't calculate efficiently our budgets. In situations like that, the last of the worries is to make a financial plan, especially a long term plan, because all the concerns are focused on the present moment, so people just take all the money they earn and immediately spend it on basic products, such as food, before the prices increase once again.

Unfortunatelly, this chaotic scenario limits very much the potential an individual has to thrive financially, as he is just unable to trace long term goals. He can't even concentrate himself on what the horizons may bring, because he is constantly putting out the fire to not die burned...

I have built budget trackers for years, and one thing I love doing is overestimating how much my expenses will be so that I will be holding on to it religiously and not dare overspend. Whatever's left by the end of the month gets carried over to the next month or straight down to my savings. If my budget for the month is $3000, I make sure that I put in $2800 in there and just leave $200 'extra' that goes directly into savings. I try to envision the 'worst-case scenario' for my utilities and bills, and honestly that saves me a lot of money as it prevents me from spending extra money and thinking that I still have a lot to work with.


I agree with this. I used online trackers and created notion templates or used mobile apps but it didn't do well for me. Spreadsheets, however, made me have a huge control over tracking and made me really dig deeper into how much I'm saving, and over time I added some more cool features to it like getting the percentage of how I spent month-on-month and see whether I'm saving more or saving less as the year progresses. It helps you get extra aware of how your money is flowing and where is it heading compared to apps that gives you pre-defined templates and cannot edit it based on what features you are thinking to add.

most apps are set to certain limiting format, which dont work for everyone. your best bet is to make your own spreadsheet in your own design you are happy with. because most smartphones/devices can display spreadsheets. that way its fully custom to the way you prefer

like having separate spreadsheet tabs for food budget
budget [    ]    spent so far [    ]    left to spend [    ]
where the 'spent so far' is a total of another list on same tab you add/update during the month and then the spreadsheet deducts total spent against the budget to tell you whats left

then you can just copy and paste your template as 12 separate spreadsheets to edit per month

the good thing about spreadsheets is that you can set alot of custom formatting. EG if weekly budget is > 25% of month. make background red

I would like to see some apps can help with this. I am of the opinion that if you write down your budget on a piece of paper, you take it more seriously than when it is on an app. With a paper budget or in a spreadsheet, you can easily see it without distraction but on a app, the ads and in-app purchases that comes with it will be too distracting. Also, it is easier to write a budget when you live in a country without a high inflation rate or one facing recession.

Useful post, I love that it's concise and that you are able to incorporate pretty much every important aspect of managing your finances, and the fact that it is inclusive, basically everyone regardless of if whether they indulge onto something or not is able to use this and is at the very least not hampered in any way whatsoever by having a budget, cause most people think when you set a budget you become even more stingy with your money, which shouldn't really be the case especially if all you want to do is to know where your money is going so you can spend it wisely.

One thing that I would love to add to this though is incorporating a savings portion from your budgeting. It's good enough that you know where your money goes and how wisely you can spend your money, it would be even greater if you can make sure that besides spending it wisely, you're also saving money for when the bad times roll. Set up emergency funds, or at least investment wallets depending on your capacities so that you'd have money you could depend upon when you need it the most.

         -   This is a well-done OP's topic about budgeting. Maybe the only thing I can add is that let's not forget that in doing the budget implementation, you must have a source of income and not just one as long as possible; your resources are more than that.

Because budgeting cannot be done correctly without them. And your source of income should also be stable, so that you can expand the implementation of this concept of budgeting because, in reality, many people don't manage this method properly, and let's not be like those people as much as possible.

I agree with you. Sometimes we read that the theory of making a budget is very easy, but when put into practice it is very difficult, and often fails. That's why many people succeed in making a budget correctly for the future because it's not just theory and practice, so they have experience in making the perfect budget.

This is an incident that happened to me several years ago, for some reason, since working in the capital, my income has indeed increased a lot, but the workload, risks, cost of living, needs, etc. have also increased. Correct. We must have additional work, at least we must be creative and have skills.

I used to be the type of person who was really extravagant, buying this and that and that, wanting a lot. to the point that I forget to save, in the end I don't know what will happen to me in the future. Since Corona, I realized that in the future there will be more expenses, I can save and set aside money, even if it's a little, the important thing is that we can manage our finances well, I saved to buy Bitcoin.

Well, if you have saved something big to make your Christmas and new year more festive, then there's no problem with that because you still live within your means. The important thing is you stick to your budget without crossing your financial budget plan. Spending during holidays is normal, what is not normal is to upgrade your expenses and take a loan just to make it happen. If your mindset is like this, you will never come to save or you will never be good enough once you enter such investments.

If you have trouble budgeting your money, what you must do is to eliminate the expenses that you do not need are just unnecessary vices because they will consume on your budget and then you might just regret it when it can be put into a good cause and expense. And if you are a compulsive buyer and that makes you spend unnecessarily, you need to seek help from the professionals because no one's gonna stop you until you have nothing left and you might do something more and crazy when you have nothing left anymore.

The easiest way for this IMO is to use a Money Manager or something. Where you would input different stuff like:

• Income
• Expense
• Assets

From there, you can organize the category and other important things. It's best to know where the money is going so that you can adjust accordingly and know how much you are really spending. This is to know if you are doing the right things or not to improve your life. It's a great time to start now.

Well, it's not bad, but the important thing about creating a budget to control your finances is to get started. At the beginning you won't have a perfect budget and you will see that as you make more monthly budgets you will include things you missed the month before. But over time you will have your expenses under control and then you will be able to save well. And to save better, when you have experience with your budget and you have been saving for a while, focus on earning more.

To properly plan a budget, it is necessary to divide expenses into fixed (payment for an apartment, transportation to work, interest on loans, communication services, etc.), variable (food, clothing, medicine), and optional (entertainment, cigarettes). It is also necessary to exclude purchases based on emotions. In the end, by analyzing your expenses, you can significantly reduce them

Today, it is not important what people might think of you. Because what all matters now is how you deal with your own life and problem. Identifying it and creating budget for your expenses is a wise thing that everyone does now because of your habit is to spend mindlessly, you will have to deal with the consequences later on. That is why you will hear people telling that you should just spend according to your income abd that is living according to your means and living beyond your means. Living frugally as you follow all of those things mentioned by OP will even make you live better.

Saving is not hard unless you make it complicated. Except for those people who don't have source of income, then it's impossible for them to save as they don't have an income to budget in the first place. However, I believe it takes discipline to finally see yourself saving without alibis or excuses. Some may have a lot of money but were unable to save because they can't control their expenses and instead spend like there's no tomorrow that comes. Probably, more like a one day millionaire.

A very informative topic. It is good to set budgets based on your income and adjustment needs to be made to suit your budget and your income. Something I see that can frustrate someone's budget, is the high level of inflation, you might have a budget of $1k in two moths time and you are working towards it.

When it is already two months, you might see that the amount you budgeted will not be enough because of high rate of inflation. This is why when you are making a budget, don't depend on the exact amount but rather make provisions for extra cash, so that incase things get more expensive than what you have budget initially, you can still achieve your goal by taking from the extra that was reserved for that purpose.

This unforeseen part is the reason why most people have trouble, it is not planned budget expenses that causes people to have trouble, we all have that and it happens and it's fine, we can't always think like that would be the worst case, we can't really see that change all that easily, what we need to do would be making sure that it's going to end up with a trouble later on.

So, if you can't plan for an expense, how can you prevent it, or how can you budget that accordingly? Well, you could try to have a "rainy day" savings along with your regular savings, on months that you get paid and nothing happens, keep putting some aside, and use that for urgent needs, but that's usually not enough. Basically, we just don't make enough to put money aside when something goes wrong.

Thank you OP for sharing these helpful budgeting tips. They can be particularly beneficial for individuals who tend to spend more than their income, leading to reduced savings or accumulating debts due to a lack of budgeting knowledge. In our technologically advanced era, there are likely mobile apps that can be installed to simplify budget tracking and management. Recognizing the significance of effective budgeting is crucial for building savings for the future and providing a financial cushion for unexpected emergencies or unforeseen expenses. Your insights encourage a positive and proactive approach to financial planning.

Budget is one of the most important part of managing finances but unfortunately a lot of people don't have a formal budget and some people who managed to have one can not stick to it efficiently. It's a great challenge if we can not stick to a budget we use our hands to draft but it's understandable because majority have no stable and fix income.

This number one step, as important as it seems, is the reason why most people fail to stick to their budget. If you don't have regular and stable source of income, it'll be difficult to stick to the budget you draft if you have one because I don't even see reason for drafting a budget when you don't have what to spend.


Honestly, setting up a budget is a small thing but along the way, we abandon to stick to it due to some unforseen circumstances. The emergency funds is missing in your list and it's very necessary because it is among the things that make it difficult to stick to budget especially when you allocate a small amount of money to it and it hit you hard in unexpected ways. Vehicle repairs and health issues are good examples of this. It's a good idea to always include an emergency fund category in one's budget with a reasonable amount allocated to it in order to cover that types of expenses whenever it occurs.

Importantly, you need to set goals for your budget and once you have the goal, creating a budget will be easier as long as you can stick to it as designed.

Before spending money we should first make a chart of how much money we are earning every month and how much money we are spending every month. If after making the chart it is seen that more money is being spent than the income every month or the money of own income is not left at the end of the month then we have to understand that our expenses are excessive. Planning is very important to avoid overspending yourself. At the end of the month, we have to calculate how much money we used without need, how much money we used without need and how much money we wasted. Whenever we can find such accounts then we can spend the money in the right way and it will be seen that even if the income is small, some amount of money is left at the end of the month.

before starting the OP's 5 steps there is another step
the first step is
tell yourself that things will need to change to live within your means. because obviously if you need to set a budget you have obviously already lived outside of your means. so before even budgeting you need to accept that things need to change
a budget will fail if you think things wont have to change


the final step is to not set such a restrictive budget that life feels unbearably restrictive. the goal is to organise and reduce wasteful spending. but this does not mean stopping all spending at all.
this i the point where you learn what is worthwhile spending

its knowing the difference between a wasted lump of money vs utilised lump of money

EG say you had 2 lumps of $20
1 lump is used to buy a pizza which is a wasteful use of something that is just a 15 minute convenience that becomes a toilet flush the next day
1 lump is used to buy a hour of you/your kids evening activity/class that makes you/them happy all week, something to look forward to next week

im not saying find something frivolous to keep doing. but instead im saying figure out a frugal item thats meaningful to your life that will keep you entertained/inspired each week to keep going. EG if taking your kid on riding lessons makes your kid happy which makes you happy, dont buy then a pony. but instead find a frugal riding class that wont break the budget, and instead is included in the budget as a purposeful spend that will mean alot to the family unity

figure out what is meaningful to your life and what is just wasteful, cut out the wasteful, and be frugal with the meaningful. dont just live like a caveman and go insane

a budget will fail if it feels like you are no longer living any kind of life

What you are trying to explain is what I discussed as #2. If you will be patient and understand my points, you will understand that I am trying to explain effectively all that is possible to learn and understand about creating a budget and the effective steps that you are going to follow to have a simple and accurate budget.

Although I know some authors or articles can give you almost ten (10) or fewer steps you can follow to create a budget, which is not bad, for me, I focus on creating the same steps I do follow in order to achieve things I want in my life. So believe me, the steps I mentioned are exactly what I usually do within my own budget. If you focus on the content under every number inside the topic, you will understand that I have explained all that is required in budgeting so far in the topic.

The biggest issue is that, if you list, and the list has something you can't get rid of, then you are pretty much screwed. For example, for me the biggest expense is literally my debt, and as long as my debt stays, I am going to have to keep paying that, for example just today I have spent 400$ for an emergency root canal operation, and it was on two teeth as well, so it cost a lot when you want care right away without appointment and it's root canal and it's two tooth, that may look like it's expensive, but when you have a hurt so bad that you understand why people throw themselves off the rocks in BC period when dentists didn't exist, you would be willing to pay 4000 let alone 400.

However, that also means now I have more debt, it's just another expense, I can't cut down on it, it's just expense and have to be paid.

You would really be needing to determine about your income because if you dont know on how to make out some budget which is really that basing up on what you do earn then you would really be most likely on getting overdropped as you would really be having those kind of spendings on which you are really that going beyond those line. This is where people do usually mess up on the time that they would really be spending up
more which is something that it is really that out of their income range because if you are really just that sensible on doing such stuff then you wont really be that making yourself that able to mess up when it comes to budgeting. It is really just that there are people who are really that too careless when making up some budgets on which some of them wont really be caring about.

People would usually be making out some adjustments on the time that they would really be experiencing some hardship on which this is really that common. For us to survive into these non  stop
economical increases and other stuffs then this is where you would really be putting up importance and relevance in speaking about budgeting and allocation.

Thank you very much for sharing this idea. I have never watched the show so I won't know it. This is a great way to create a budget while you make a saving and that saving grows over time. This also creates a mental state in which whatever budget we come up with, that budget will never include the extra amount that we separate from the actual income.

We can learn to live a life where we can manage our daily expenses in that limited amount of income and save up for the future. Also in case of emergency, we will always have a backup plan ready.
I'm not going to lie, I will try out this method for sure. Starting from the year 2024. This is going to be a great journey if I manage to pull this. Thank you again for sharing.

I agree with your point about determining income, I see that determining income is the key to realistic budget limits. While the comparison between income and expenses I think can play an important role to determine income. However, if we want it to be even better, we have to separate the prioritized expenses and even record them every time there is an expense so that they can be controlled.

Before making a budget plan, try to conduct a feasibility study of the things at hand that should be included on your budget plan in other to have an idea of them first, then try to make a rough estimate and then begin with the recommended procedures from OP, also when making a budget, we must consider the needs from their order of preference and lastly, we shouldn't forget to include the miscellaneous budget for everything under our budget plans.

Yo, this topic is fire! I couldn't agree more.

Budgeting is so important, especially in these tough economic times. If I didn't have a budget, I'd definitely be in over my head and drowning in debt. Budgeting takes discipline and commitment, but if you stick with it, you'll see the big benefits.

I think everyone should start budgeting today to manage their finances effectively and achieve their financial goals. Let's do this!

Since when im started to have to earn I always commit the use of the 50-20-30 strategy which is the 50 percent is on the daily needs or sustainability for survival like food, rent, clothes, etc. with the 30 per cent those are the emergency funds you can swap the 20 and 30 budget it depends on you still at the end of the day its a must there's accumulated amount on this particular part, emergency funds is a must because anything can happen with your current situation unexpected resignation, natural occurrence, etc. the rest money is for your wants now if you want to spend for your satisfaction go a head as long as you know how to monitor where is the inflow and outflow of your money you don't need to worry.

A very good list of advice you got.

Budgeting is very important, especially if you have your own family, to avoid spending it on unnecessary things. What I mean by unnecessary things are those things that we only wanted, which would not benefit anything in your household. It also help for us not to overspend it, and to visualize how much we should spend and how much we could save.

Budgeting should be practice as early as possible, to save money and spend it on things that would benefit us in the long run.

Thanks for sharing this important information. Budgeting is very important. Sometimes, it is even the reason why some countries aren't developed or having a good economy. They have lots and lots of resources, but are wasteful and have little or baseless spending plans. Budgeting is really helpful, both for the rich and broke.

Everything will start with planning and one of the things in the planning is the budget. The budget is one that must be carefully thought out and prepared, because it will greatly determine the success or failure of the business that we will run. And don't forget to always budget for reserve funds, because not all businesses run smoothly at the beginning and often require an injection of funds. Not only at the beginning, when it is successful and advanced, sometimes something unexpected can happen.
I remember when Covid came, it came unexpectedly and a lot of businesses were destroyed because of it, if you are not ready with spare money then it is certain that the business we run will not survive. I listened to a friend's story who had to maintain his business and he did everything he could including selling his assets and getting into debt, I was shocked when I heard the amount. From there I can learn that reserve funds are indeed very important in doing business.

Of course borrowing to celebrate holidays or the new year will be a new disaster at the start of the new year, and this should not happen because it will make us dizzy after the money borrowed is used up just for a moment's enjoyment.
Celebrating Christmas and New Year according to our abilities and with the abilities we have, we can definitely celebrate it well and happily with our family, and wise people will plan the celebration of the big day or New Year by planning it well in advance. And they make a strict budget before the big day arrives, so that they can celebrate well and have enough money for all their needs and also a simple holiday for their beloved family within the existing budget.

Without proper budgeting, all successful businesses are doomed to fail. That is already expected much more to those high rising businesses where extreme budgeting is a must. If you fail on that, the whole concept of business will fail as well. So put budgeting as the topmost priority when aiming for success and long term profits.

However, budgeting can always be learned if you have the eagerness to study on it. Sometimes, it takes losses at first before you will see the high importance of budgeting, and that's normal as long as you also learned your lesson.

You have forgotten the simplest and most basic thing of creating a budget but it's one of the most important thing and that's to list all of your expenses and where your budget is going. With that, you'll be able to track your expenses and you know where it will be spent. Because if you don't have that list and you're good at the other things, how are you going to track them all? You've listed about #4 as creating and writing the budget but I think that should be at the top together with determining your income/expenses.

People mismanage their money because their goals are not fixed, and they have no enough knowledge how to save and get rid of unnecessary expenses. When people have tons of money, living their present is like there's no tomorrow and just spend everything they can in  just for a day, hence making these people  turn into one day millionaire, and struggle after.

Creating a budget seems so easy but in reality, hard to do and process. Mostly because people are only good at planning but have no real discipline to stick to their plans and make them succeed.

Start creating the budget or priorities for your expenses
# This would really be the key for you to survive yourself and able to handle up well when it comes to the money that you are earning on which trying out to have that budget allocation
on which you would really be setting it on to priorities on which it would be that normal. If there would really be some unexpected spending then this is where savings allocation would take place.
This is why it would really be that recommendable that you should really be having that kind of allocation whenever you do get that pay.

It is really just that a matter of control and discipline towards one self on handling your finances because if you dont make yourself that at least realistic or being that mindful about the future
then you wont really be bothering yourself on taking up some actions but instead you would really be just that focusing on the things that you would really be that tending
to deal with.

Just simply live and deal up on the things that you are really that wanting into and of course everything should really be in moderation and never ever considering yourself
on spending that much which is way more than on what you do earn because this is where usually people do mess up, on the time that they would be having
those kind of spendings which is that more than that they could earn which is really that too absurd.

When we give importance and value to the money we earn we lavish it on every luxurious item that comes to mind. The first step to be fervent in setting a budget and sticking to it is by giving value to any amount of money we earn. For with value to our money all other steps to a healthy budgeting is seamless.

The solution to surviving this hostile economic time is having as many streams of income as you can handle and be efficient at it. A single income flow can be daunting and no matter how big the amount from a single source might seem like it is not a hedge to feel comfortable about. What if a an incident took place leading to the pause or totally stop of the source, what or where will you fall on for survival unlike when you're with a multiple income source?  Multiple streams is the only hedge to all the effect of the  economic recession we are currently facing.

This like a KISS method. Keep It Super Simple. If someone with some experience in this can, I'd be like to have an answer to this budget question that has always been on my mind from my finance class, what if you come into extra money for instance like a tax refund or financial aid refund. Do you add into your income?

I agree, people these days be freestyling their daily budget as if they are just picking up their money on the floor. Budgeting should be realistically set using the common sense, living without a daily budget is like living in borrow time.

Diversifying is the best way to counter or align your budget, do not settle for one source of income, try to explore more rooms where you can generate profit even it is a small business or lesser income than your main source. I don't think it is hard to find, well maybe it is at first but once you find it, you can prolong it or best you can add more to it. Luxury these days doesn't apply to all, if you can't afford don't buy it, it is a very simple logic.

Having some kind of plan for your budget is really helpful for keeping your finances in order.  You gotta list out your priorities by how important each thing is for reaching your goals.  If you try to do too much without a strategy, it usually ends up being counterproductive. 
I've definitely learned that lesson the hard way more than once! So taking some time to map out what matters most can save a lot of headaches down the road and  you don't need anything super rigid or detailed.  Just figure out the key things you want to focus on and go from there.

If someone clearly has enough income to cover expenses, I think starting from income, as the op suggests, can be a good idea. But if one is currently living off savings, I think one should start with determining the realistic minimum monthly expenses (mainly, the rent, the bills, food costs, transportation costs), and then consider how much one is earning vs how much is required. This can help set simple goals of what kind of job a person needs to cover the expenses. And then the excess can be used for other achievable goals.

As long as we continue to carry out our plans and manage our finances well, we don't need to worry about anything. We will not experience difficulties, especially if an emergency requires money because we have allocated a certain amount of funds for that need.
We have to be able to allocate income to the places we have noted to manage the money effectively.
This will give us the freedom to use our money according to our portion and will not interfere with the money used for other needs.
But this requires practice to get used to managing our finances so that everything can run well. By managing our income sources, we can continue to survive even in difficult situations and conditions.

Saving a budget to spend will be much more difficult, especially if someone is not used to living in simplicity.
The level of effectiveness may vary from one person to another. For example, if our needs are at the stage of fulfilling daily needs then only in that area we need to prepare.
It will be different when someone owns a business because the need for money will be much more unstable for the needs of developing or rejuvenating the business.
Preparing your finances to be better is not easy because we are required to look for a much more productive place to make money. If the placement of money is not in accordance with the desire to obtain profits, then the money will not work to produce profits.

Everyone has different financial levels based on their daily income or monthly salary, although discipline in following these rules will not achieve maximum results. For example, if their financial level is low, maybe they set aside some of their income for emergency savings every week or month, but emergency savings will also not meet the required budget.

However, at least those who have implemented financial management rules will be useful in the future, even though they cannot fully cover emergency needs if an unexpected event occurs but already have part of the budget for emergency needs.

However, some instances may prevent us from following these rules. Unpredicted events may suddenly happen and yet our budget cannot cater those emergency needs, hence we end up crossing the rule and touching the budget we're not suppose to use. But if we have saved emergency funds, I think our budget will not be put into compromise. There should be different budget funds that we need to consider, and sticking to each budget will make us live stress free and happy.

It takes discipline to make a budget works. Otherwise, your budget plan will be useless since you're not even following it in the first place. Patience and discipline are the keys.

If you could go back and read the context of this topic, you would understand that I am not talking about a certain amount of money you are going to spend or even how to increase your savings. I am not saying that if you write a budget, you won’t save. No, creating a budget will help you save more than you expected.
  So if you could read well and understand, you will know I am just talking about steps on how you create your budget based on your income and your expenses. I will advise you to read and understand the context before you can reply to or criticise a topic.

I think that thee way you structured the title of this thread and the content of the thread had not done more justice to the required intention behind the thread. Maybe being more detailed on what you mean by setting up a budget could have helped me understand the context of what you are trying to say. When you talk about setting a budget, I guess it's more of setting out an amount you will be spending out of your earnings or the amount you will be saving out of your earning right?

Setting budget in either of those cases is very necessary as it would help you avoid unnecessary spending and will also go a long way in increasing your savings and reducing unnecessary spending.

Of course, it is very important to manage finances to be able to find out about the expenses we have, whether we have used them for the purposes we really need or not, because if we don't have financial management, of course we won't be able to have savings and investments will always be insufficient income. that we have if we cannot manage our finances well.
What you say is very true, no matter how much money we have, if we cannot manage it well, of course we will still be like people who don't have money and will also not be able to meet the needs we need.

Sometimes people make budgeting as if one needs a rocket science degree in order to do it right. I think budgeting is very simple. It's probably just a matter of common sense. Live a simple life. Avoid an unnecessary lavish life. That's it. If you are still having a hard time budgeting what you have despite living a simple life, then that means you need to find ways to increase your income. Now, that's probably the harder and complicated part.

It's a good tip you made about budgeting, because this is usually the problem for most communities, not only in the crypto space but also in people's traditional lives. There are many people who have money but are not able to handle it properly.

So, this is something that others should know, so this topic you made can also be a guide for people who want to learn how to handle their budget correctly. So thank you for spending the time just to share this here.

You got it right but the most important and key step from all those points is having priorities. One must set proper priorities on their expenses. Most people fail to create a "budget" plan and remains broke by the end of the month just because of spending money on things they could have "lived" without. They give priorities to "useless" things and then they end up struggling to pay their bills. If paying bills is your priority, pay that first. If paying your debts is your next priority, then do that. "Saving" can also be a priority. After you are done saving, the rest of the money that is left is yours to spend on anything you want. Budgeting is not as complicated as people thing. As long as they keep themselves organized and spends responsibly, they will always be able to follow their budgets.

Budgeting is quite good, but while you're trying to make a budget and you've listed everything you need and want for the year or month depending on the duration the budget is for, you should always not forget to make provision for emergencies and situations that are usually unplanned so that you'll be prepared for them when they happen and we will not have to tamper with money that you have kept for other purpose just to sort and remedy these emergency situations.

Creating a budget is something economically wise that not enough people tend to do or take seriously.  Here is a link for anyone looking to create their budget.  https://www.empower.com/learning_center/calculators/managing-monthly-budget.shtml#/

This link will make it easy to break down your monthly expenses.  This is something I recommend that my clients do AT LEAST once a year.  This is really the ultimate way of knowing whether you're saving enough for retirement or not.  Also just to know if you're spending too much money in certain areas.

Borrowing money just for additional needs such as for Christmas will only add new problems and after the Christmas holidays are over there will be lots of bills that will make us have to work even harder. spending something must be adjusted to financial capabilities so that there will be no such thing as a shortage of funds, everything must be arranged so that the available funds must be sufficient.

Well said. For me I think what’s most important to consider is the step one which talks about determining your income. You first need to acknowledge and respect your income. You can’t create a budget without factoring this in. Something else is about your needs. While you create your budget, consider what you need first, don’t go creating a budget for a want when you have needs to meet. And even when you have done that, you still need to arrange them in order of priority and then create the budget. This still works.

Having a plan and budget is definitely needed in order to have organized life.
No plan at all is detrimental to any path that you want to take.
List your priorities according to the importance of the item/task to your goals.
Because you may be neglecting vital tasks and considering secondary tasks on top of your priorities.

Like they have said that he who didn't plan has already planned to fail and this is why we have some businesses springing up but they are not succeeding because of lack of proper guide and management. Budgeting is one of the leading factors to business and it growth.

A business person who knows what he is doing, would take stock of his business from time to time and make plans to growth it. Businesses are not handled into success for the lack of proper budgeting, even the government budget on how to carry out his capital projects and recurrent expenditure. Budget determines how far the business will grow or how soon it will crash also depends on lack of proper budgeting.

Because of how expensive things are this it is why it is important to budget how every money is being spent,  if you don't follow up how your money comes in and what the money goes out for you will just end up saving anything.  Now that we are facing serious economic crisis this when we need to plan budget and learn how to spend with budget. The inflation rate which is the reason why things are very expensive should not be a reason why people won't bother to make plan in budgeting expensive, despite how things are very expensive if money is well planed how it is being spent it is possible to have remaining for savings.

Everything would really be that correlated or connected to each other but this is the one i do really
like to emphasize. 5. Review the budget;

This is the most crucial thing i would say that a certain individual must mind on on which you should really know on how to budget on which it would really be
that basing up into your income on which it is really just that right that if ever you do see that you are spending up too much on a particular thing then it should be controlled and minimize
because if you dont stop it or find a way the financial struggle could really be experienced.

Budget would be crucial even if  you are that earning that much but the spending or taking out those funds is on uncontrollable manner then it would really be pointless or useless.
This is why it would really be that important that you should really know on how to set those things specially if you are having your own family then budgeting
will really be that something needed for you not to face up those financial problems. As much as possible we should be finding another source
if we do tend to have that upgraded kind of living but if its there's none then stick to the basics.

I am not doing it right now, but I used to do a method that I learned from "friends" tv show. Obviously that was in the 90's so it was quite possible, and it was set in the USA so it was even more possible, not really possible here where I live currently with world record breaking inflation rates we just had in the few years, we had %100+ inflation rates, for a few years, and my income didn't go up like that, so this method is for people who live in a bit more stable places. Just put certain % aside every single time you get a paycheck and assume whatever left is your salary. So you get 1000 dollars a month? Put 100 aside and imagine you get paid 900 and then that 100 is not available, it never existed, you never got paid it, its somewhere safe, like a bitcoin investment, or gold, nothing crazy like futures or margin, and you just keep doing that for a few decades and you should be able to retire rich.

Thank you for taking the time to come up with these wonderful budgeting tips. It is vital to measure your income with your expenses and see the outcome. If you can save some money no matter how small after paying for your expenses, you have a good budget. But if you have to borrow to finance some of your expenses, then you have to readjust your budget.

I am not moved by festivals or holidays like Christmas. I still ensure that I spend within my means. If I don't have extra funds to finance house decorations, new clothing, or travelling for vacation,  I will have to drop them from my budget because they are not basic needs. I have always told people that we have to enjoy Christmas based on what we have and we should never borrow because we want to celebrate Christmas in a big way more than what we can afford. We shouldn't lose sight that January comes with a whole lot of bills.

It's really critical that you use your actual bank statements, because so many small things can be overlooked when you're just working from memory and it's the small things that can really add up over time to undermine your budget. Being honest with yourself and cutting back is also critical - do you really need that gym membership that you've used twice in a whole year? Why are you keeping 3 different TV subscription plans running, when you probably only need one and could rotate them when necessary? It's also dangerous when you start on a small salary and grow it over time, as you can start getting lax with your outgoings or purchase unnecessary luxuries which could be beyond your means, recheck your budget often to see these changes.

This is a very important thing to do especially now that we are experiencing financial crisis around the world.  The new year is another opportunity to correct the errors we made the previous year and having a budget is one way of achieving that. The budget will make us have a sense of direction.  While working hard for your money,  the budget will help one to adequately distribute the earned money to effective use. Earning money is not just enough,  but how you spend your money is something to be concerned about.  If you spend well, you might be getting returns after every good expenditure but if you spend carelessly,  that money spent is gone and gone for ever. last thing anyone would want to do next year is entering the year without a goal or a direction.  If you fail to plan your life well,  then you are obviously planning to fail. No more room for excuses,  it's not too late to make that plan (budget).

Living in an era like this, we really have to make a budget where everything we buy is expensive, starting from vehicles, gadgets, houses and so on. Plus one of the few advantages is that it has weathered the Great Recession.

All the suggestions you give are good and must be applied in everyday life. Reduce unnecessary expenses, increase your savings by investing in the crypto market and don't sell.. One thing I know for sure is that diversifying your income can help protect you from a lot of the craziness going on in the world.

If you want to be happy in life, everything must follow the rules. If a person moves outside the rules or spends money, he will have to face many problems at some point. For example, due to spending extra money, he may run out of money at some point or even bigger.  If we can follow the rules then we can organize our life very nicely. There are some people who spend extra without accounting for anything they have to face a lot of problems. If we try to calculate them  If I do, I don't think there will be any problem.

This is a completely logical approach.

I think this is the most important factor determining the type and method of creating a budget. On this basis, I would like to delve a little deeper into this point, considering that the size of income versus the size of expenditures can determine the size of the budget that can be created at a given time. This requires a basic condition, which is the presence of surplus income to enter into saving (according to a precise plan) and the size of the budget that can be obtained be clear.
This leads us to consider that the more revenues exceed expenses, the easier it becomes to plan to create a budget. It becomes easier if we adopt what investors call “diversifying sources of income,” because often someone who has one source of income (even if it is fixed) cannot balance it with expenses in order to be able to develop a plan to create a budget.

I agree with you mate. This will also help us to avoid overspending on something we don't really need. Mismanagement of our budget may lead to financial instability. The best thing to do here is to prioritize our needs instead of wants as we all know that most "wants" means liability.

A very useful post.  All of us should have an ideal budget plan before the start of the year.  All of us will benefit a lot if we follow these rules and plan our budget.  Before the budget plan, it is right to think about our income and expenses.  Uncontrolled travel expenses drag down our finances.  Planning is very important to manage life well.

A very correct approach!
A person must be able to manage his resources - from time to money, and this requires information and planning.
Without this, at best, you will not have enough of your previous salary while waiting for the future one. Costs for communal payments and other mandatory payments may simply leave a “hole in your pocket” at a certain point, although within a month your income covers your expenses. This is me about calendar planning of income/expenses
In a word - a very useful approach which, by the way, will most likely show that you are spending some part of your income, to put it mildly - irrationally

Marry Christmas and happy new year.
 It comes to me to share my knowledge with others, but I am sure some might know the steps in creating a budget, but it might be that they are not following it effectively. I hope if I share such knowledge, it will help a lot, especially in the season we are in now. I know that as we have already celebrated Christmas, we have spent much of our savings, which we are still going to spend more on when it comes to the New Year celebration, so I take this as a reason to share such information with others so others will not suffer, especially after all this celebration, so I will list and explain the steps in creating a budget.
 
The steps in the budget include

1. Determine your income: As the first step in creating a budget, you have to know your total income in terms of what you can afford. Do not write a budget that is more than your income and end up not achieving anything at the end because your income determines your budget, so let's take note of our income first. This income might include your weekly,monthly, or even yearly income, as well as side hustles and any other source of income.
 
2. Identify where your money is going: The second step in creating a budget is to track your expenses. This is also very important because, without knowing how you usually spend your money, you will end up writing a budget that you can’t even stick to. More over, expenses include housing, transportation, food, entertainment, gambling, and so on. When you have identified where your money is going, you can categorise it into groups. For instance, clothing, house rent fees, and others should all be in the category of housing. If that is done, you have definitely achieved your second step in creating a budget.
 
3. identify or set an achievable goal: This is the third step in creating a budget when you have identified your income, tracked your expenses, and categorised them. Why I say achievable goal is that you have to set a goal that you can achieve either long-term or short-term. For instance, you might save money in order to pay your debts, invest the money, or even pay for housing and any other expenses, such as buying valuable and usable items that won’t be a liability to you.
 
4. Start creating the budget or priorities for your expenses: This is the next step, for me. This is the step where you will start writing the budget. It is not that you won’t write those other steps I mentioned earlier; you will also write them, but this is the stage where you will allocate some amount of money to the categories that you have created at the second step, and you have to make sure that it aligns with your priorities. After allocating a certain amount of money to those categories, you should make sure that you keep some of it as emergency funds; it is also important.
 
5. Review the budget; in some cases, I mean monitoring, evaluation, or adjustment of the budget. This is like the final stage in creating a budget, although this stage is a continuous process because this stage never comes to an end unless you have purchased all that you have put in your budget to achieve this process, including regular adjustments as needed to accommodate and adjust your budget. This is done in case something comes up, such as the use of the emergency fund that you keep as a category for things like an increase in the price of what you intend to buy for medical expenses, which might be an emergency, and many others. In this step, you must track your budget very carefully and with caution to make sure you have achieved it.
 
The steps I have listed above are the ones I follow whenever I want to write a budget. You can change this step in many ways. For instance, a gambler can use it, but it will be more effective with the amount he needs for the gambling, and he should make sure he follows the track, so stick to the budget to avoid the source of unusual spending.