By this time, you should have been tracking for a couple of months and have a pretty good idea of your spending each month.
Your goal this week is to review each area of your budget and compare it to your actual spending. How many areas came in exact? How many areas came in below budget? How many areas came in above budget? Your goal is to be either exact or below. Above budget can spell trouble. Highlight any trouble areas and decide how you are going to balance that category. Review the previous posts for ideas and also consider a cash envelope where you only withdraw the budgetted amont. This makes you realize when you are out of money in that category. This is particularly helpful if the category you are having trouble with is food, gas, or eating out.
After your review, do your best to balance your Money Managment Plan to have an actual working spending plan that you (and your spouse if married) will abide by for the next few months.
Then next week, we’ll talk about setting financial goals.
Don’t forget to read Part 1 – Do you know what you spend?, Part 2 – Organizing What You Spend, Part 3 – Making a Money Management Plan, Part 4 – Balancing the Budget, Part 5 – More on Balancing the Budget, and Part 6 – Even More on Balancing the Budget if you have not already done so.