You can achieve financial stability without a budget; it’s like assembling DIY furniture without the instructions. It takes 10 times as long, leads to fights with your significant other and never looks like the picture on the box. And, almost everyone attempts to do both at least once during their lifetime.
Sure, there’s a challenge in puzzling out the 50 pieces of a bed frame, but there’s a lot more at stake with your money. Increase your chances of success by following the directions and keeping it simple.
1. Essential Expenses
First, determine your total monthly in-pocket income. Leave out taxes and business outlays, but include automatic payments such as employer insurance or 401(k) deductions for an accurate picture of your expenses. Now, budget up to one-half of that total for essential expenses, including housing, basic utilities, groceries, healthcare, auto insurance Newark DE and child costs.