Step 2 – Budgeting

Actively managing where your money goes is the starting point for financial freedom.

Have you completed your net worth?

If you have, you would have ended up with either a positive or negative figure – either is OK. The aim here is awareness of knowing where you stand.

…If you do have a negative figure, can you see why? Do you have a large loan balance? Or do you have several credit cards with significant balances? Are your assets low? No savings or investments?

Remember, your net worth shows you how much money you would have left if you were to sell all your assets and pay off your liabilities. It focuses you to think about later life and increasing your net worth in preparation for retirement.

Moving forward

You need to know where your money is coming from and going, and exactly how much. This will enable you to identify any weak spots and be well-positioned to tackle them.

You should also think about the life you want to have? Do you have a savings goal or a particular lifestyle you’d like to maintain? This is where goal-setting comes in.

To slowly ease you into the concept of budgeting, I’ve created the following to help you get started:

  1. Read this
  2. Watch this 
  3. Calculate your budget using this download*

*The download I’ve created has been set up so that you simply need to add the values of your various income and expenses into the cells. I have also enabled the titles to be changed. 

If you’re stuck…

I am here for all your questions, so please do not hesitate to ask. Simply reply to the email you should have received or complete the form below.

info@moneymonday.co.uk