Budgeting Basics

Everyone begins at the beginning: setting up a plan for deciding in advance where and how to spend income and deciding how to use any excess for the benefit of self and family.

The first step in the process is to keep track of every penny spent for a brief period – usually one month. Next, choose what changes, if any, to make in future months.

Keeping track can be done through a bank account, with a special financial planning software, or a handwritten journal.

Once it is clear that a preferred pattern of spending and accumulation is in place it’s time to make it official with a system that will guide you in the future.

Your system can be as simple as using the envelope plan, a journal, assigning a category for every expense through your bank account, or use of financial planning software.

Money and Time

A key concept of managing money is that of the Time Value of Money. The sooner money is received and put to work earning compound interest, the greater the value of that money. 

Look here for more details.

Investment Terms

Understanding successful investing and money management requires a basic knowledge of the language of investments. 

There is no single place where all of the language is offered. For example, real estate, one of the main sources of investment wealth is outside of the source which is recommended here. It will be covered at another time.

Check out this investment language source here.

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