In my previous post “How to create a zero-based budget” I addressed the basic steps for starting the budgeting process, but I didn’t talk much about how to prioritize your allocations. Most financial planners agree that having an emergency fund is the first step in a sound financial plan. If used properly, an emergency fund can act like a shock absorber for financial bumps and pot-holes. Rather than letting these events throw your budget off course, you can take them in stride. A short-term emergency fund will help eliminate anxiety about having enough money in your account or the timing of inflows and outflows. The goal is maximum peace and control with minimum effort.

Read more »

In my last post, I covered why most budgets don’t work and how to fix them. One of the ways to make your budget work is to create a zero-based budget. Today’s post outlines how to create your first zero-based budget. Over the next few weeks I’ll be addressing various aspects of creating and managing a budget. Let’s start with the basics. Some of these steps may seem obvious or simplistic. But for those who just can’t seem to get a budget started, I hope to give you some step-by-step detail that will help make creating a budget easier.

Read more »

Let’s face it, budgeting can be a pain. Most people get too discouraged trying to get a budget to work. They spend hours trying to figure out how much to budget in each category and may even track every penny spent during the month only to find out that reality didn’t match what was budgeted. In these instances budgeting just seems like a futile theoretical exercise. There’s no follow up or reconciliation to tie one month’s budget to the next. Add to this the emotional issues that budgeting can trigger and your chances of maintaining a budget dive bomb. Many people who get to this point just give up and quit.

Read more »