A little "math"
Money in ______ money out
Equals
=
List 3 commonly used time periods for making a budget.
Weekly, biweekly, monthly
When do you write a budget?
BEFORE you need to use it. (You need to plan ahead)
For example, write a budget for November during October.
What is the best budget?
Zero-based budget
What is a discretionary expense?
A non-essential or optional expense
How many $ should you have "left over" after writing all of your "money out" categories and subcategories?
$0
What are the advantages of writing a weekly or biweekly budget?
1) Better for people who have a hard time sticking to a plan for an entire month
2) Can line up with pay periods
3) Revised more frequently than monthly
What major "Money out" category do you set first? (Ignore donating)
Saving
What is the only (truly functional) budget?
Zero-based budget
What is the first savings subcategory that you need to fill (the highest initial priority)?
Emergency fund ($500)
What are the advantages of writing a monthly budget?
1) Time period matches most bills (for example, you pay rent and subscriptions monthly)
2) Only have to write/rewrite your budget once a month which could save time (vs. weekly or biweekly budget)
3) Expenses can change week to week and a monthly budget handles such changes better
Easier to budget for bigger items because "money in" is larger (vs. weekly or biweekly budget)
How many times/months does it take to get a budget "right"?
Technically, your budget is always improving, but 3 months is typical for dialing in a decent budget.
What are the benefits of using a zero-based budget?
Keeps you accountable, easy to track, black and white, can find apps that use zero-based budgeting
Does a zero-based budget mean you must end up with $0 in your checking account? Explain.
No. It means that you need to start and end your budget period with the same dollar amount. For example begin and end October with $300 in your checking account.
How do you decide the best length of time to write a budget?
How often you are paid
How likely you are to follow through
How well you can track expenses
What do you need to do after you write your budget?
Track expenses, follow your budget
What is a zero-based budget? (Write more than just "money in = money out")
You give every dollar earned a purpose
Every dollar has a "name"
Every dollar has a "hat"
Every dollar has a "job"