Bud-get

get it right!

Does your budget never seem to balance the way it should? Are you constantly digging into the savings to make ends meet? It's time to take a good look at essential components you might be missing or you have not allowed sufficiently for in your household budget plan. Here are some of the most common budget oversights. With the global financial Meltdown racing at a fast speed there is a desperate urge for the young and working oodles to handle their resources with care. A budget is a blue print of the expenses of an individual. Applies to the nation too.

H #1 Failure to Plan for Inevitable Expenses
We often have certain expenses that we term normally unexpected. Is that true? Don't you clandestinely know that these things happen? Have you ever owned a car that did not need repairs or maintenance? If you have, you probably didn't own it long enough. The solution; Start counting on the car breaking down instead of hoping it doesn't! Plan for these expense in your household budget. Get it right. Home maintenance is always a factor in our finances. Even if you rent, you probably have some home related expenses waiting to creep up on you. These are just a couple of examples of variable or irregular expenses that we often overlook in household budget planning.

Property, Auto, Health and Life Insurance - if not paid on a monthly schedule. Even if you do pay monthly, you should try to save for a lump payment if at all possible. Most companies charge up to Rs. 1250 for monthly payment options. I say, it's always best to invest in yourself. Don't you agree? Plan for these expenses in your household budget to save money. Put the Rs.15000 in your savings!

Taxes: If you know you will have to pay hon. Govt., prepare for it. If you value your home or other property investment, prepare for the costs. Don't scramble at the last minute to come up with enough to pay your obligations. If you do, it's likely other areas of your household budget will suffer greatly, since these expenses have a high priority.

Clothing - Now, this has been the choice of the day. You give utter significance to clothes. You need to spend more if you have grown up by your side. Expecting them to stop growing or somehow not care how they look to their peers? Of course not! I use every resource available to me to cut down the clothing budget; I know I must account for this expense in my household budget plan. It arises, when someone is really prepared.

Gifts – This could be the unexpected. If your friends, family, and kids don't care if they don't get gifts from you, if you've declared war on the holidays, or have a convenient hiding place when these occasions take place, then you can skip this one!

Medical - Unless you're lucky enough, or not lucky, to qualify for medical assistance, you undoubtedly have medical expenses over and above the cost of your health insurance; Co-pays for doctors and medicines, over-the-counter medications, dental and eye care expenses. One can’t omit this in his/her budget. Get it right.

H #2 No reserve Fund
It is essential to posses the knowledge about what warrants an emergency. A real emergency might include; loss of income, severe illness, or death in the family. Although we all hope such occurrences never happen to us, sometimes we aren't lucky enough to flight these unfortunate events in life. You should try to set aside a specific amount, no matter how little, each month in an emergency fund to eventually equal at least three to six months of your current income. I know this isn't possible for some people with substantial debt payments. That’s why you need to budget before something could visit. Get it right!

H #3 Luxury
This is simply spending more than you earn. Unfortunately, this is a direct consequence of household tenet #1 and #2. When funds are not set aside for variable expenses and emergencies in your household budget plan, you will inevitably turn to plastic money (credit cards) to bail out. Spending more than you earn is a sure sign that you're headed for a snag. When you spend future earnings its like "counting your chickens before the eggs hatch."
A 5-10% of your income as savings, or add on to existing savings, each month for your emergency fund. Make sure your expenses are within your income.