Getting By
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A new year brings a feeling of revitalization. Many of us may be attempting this in many different areas of our daily lives, hoping we can make an improvement by following through. One major area you may be concentrating on is your financial expenditures. However, it can be overwhelming to get started. The basic first step is tracking where your dollars go. After you have gotten into a routine of doing this, you will be able to identify the essential living expenses and then create a spending plan in hopes of spending your hard-earned dollars more effectively, reduce the need for consumer credit and possibly even save.
If you are dreading this because you do not have a long period of time to commit to it, it does not need to be done all at once. Start out by creating a chart with two columns, one for the description of the expense and the second for the amount of the bill. As you pay each bill for that month, record the amount in your chart. At the end of the month, you have a good starting point of knowing what your monthly spending looks like. For expenses that vary from month to month (ie electricity), you may need to go back to the previous year to add up each of the months and divide by 12 to get the monthly average.
The next step is to total all of your expenses for that month and subtract from your monthly take-home income. For families whose income fluctuates month to month, a suggestion would be to use the yearly take-home income amount from the year prior and divide by 12.
For each month that you are able to do this tracking, you have more information than you did before to help you get the most from your income. Eventually, the goal is to create a monthly spending plan that in the end helps you to save or apply more of your income to credit debt.
It is okay if you get off track for a while--don’t get discouraged or give up. Just start it again for the next month.
Contact – Janell Barber, Chouteau County Extension Office, janellb@montana.edu, 406-622-3036
Additional information and examples can be found in MSU Extension MontGuides #MT199703HR Developing a Spending Plan and #MT198703HR Using a Check Register to Track Your Expenses at http://www.msuextension.org. If you have questions or would like a hard copy, stop by or call Janell Barber at the Chouteau County Extension Office at 406-622-3036.
Montana State University, US Department of Agriculture and Montana Counties Cooperating. MSU Extension is an equal opportunity/affirmative action provider of educational outreach.
