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In my previous
article, I said that there are several things
to help your finance every month :
- Plan
your income and expense every month
- Do
the plan strictly
- Have
reserves fund
- Take
some insurances
This
article will discuss point 1 and 2
1.
Plan your income and expense every month
Starting
right now, plan when you will get your salary, how
much its amount, and when you will spend your money,
what the posts and how much the amount of expenses.
The plan called Budget.
In
example, you will receive this much on your salary
on 27th, then from that amount you will use this
much for this expense, that amount for that expense,
and so on. So, if you make a budget first, you will
detect on the first place whether there will be
deficit or not in the middle of the month. If yes,
you can revise the budget to avoid deficit.
Composing
budget is very easy. If you have already known the
amount of average income and expense every month,
you could also predict how much income and expense
for the next coming months.
Budget
function
Many
people feels uncomfortable to draw up and have budget.
They think budget is the same with restrain their
shopping desire.
NO.
The function of a budget is to inform if your expense
surpass your income or not. If yes, you ocan revise
the budget so deficit can be avoided.
But,
if you do not have budget, you will be difficult
to know if your family expense has surpassed the
income. So, if there is deficit at the end of the
month, you just realize it at that time, after all
has happened.
IMPORTANT
Include
saving in your budget. Usually people save their
money later, after their money was spent. So, sometimes
they cannot save their money because all of their
money was spent for shopping.
Thereby,
it would be better if saving is not included later
but earlier. Therefore, when you draw up a budget,
insert saving as one of the posts that you must
do earlier, at least after you repay your loan.
2.
Do the plan strictly.
A
plan is useless if it is not done. In here, plan
of income and expense as much as Rp250,000, if you
strictly obey and want to do according the budget,
at the end of the month the discrepancy between
income and expense of your family will be certainly
figured out, namely Rp250,000.
Thereby,
it would be easier to make another plan froward,
because you have already known that every end of
the month you surely have discrepancy of Rp250,000,
which can be used for another purpose.
However,
sometimes people, although have already made up
a simple budget, is still unable to meet their budget.
If he, i.e. allocated Rp500,000 per month for shopping,
the figure could expand to Rp750,000.
This
can be prevented with a harder system, namely 'envelope
system'. If you have already drawn up a budget,
you should allocate the amount right away according
to each post. Each post is represented by one envelope.
If the money in the envelope is empty, you don't
have to try opening the other envelopes, because
you have already known that budget for the related
post has touched its limit. Envelope system is a
little complicated, but perhaps it is the sacrifice
that you should doso that you will not experience
deficit. The most important, your expense now is
more controllable.
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