CREATING YOUR SPENDING CREATING YOUR 12-MONTH LOOK-BACK FINANCIAL PLAN Comparing your past income and spending allows 1 Using your Spending Look-Back data and you to see if you’re spending beyond your means, the template spreadsheet, create if you’re breaking even, or if you’re saving for the income and projections for the next future. This knowledge will help you make more 12 months, then base your monthly informed projections about the months and years on that annual budget by dividing each to come. category by 12. However, be sure to adjust seasonal variable (e.g. holiday gifts 1 Open the Budget Template Spreadsheet or summer vacations) or print out copies of the monthly budget template. 2 Examine your flow. Subtract your expenses from your income. If you have a 2 Gather your statements from the last three surplus, you can decide how to spend, save, months (e.g., credit card, bank accounts, retire- or invest your money. Add this to your budget. ment, pay stubs, cash receipts, utility bills). If you come up in the red, it’s time to make adjustments to your budget. You can boost 3 Add up and categorize income and expenses, your income by working more hours or taking using a separate template for each month. on another job. Another option is to monitor Modify the income and expenses categories and decrease your spending habits. to reflect your personal finances. 3 From this worksheet, you can start spotting saving and spending trends. Use this infor- mation to find ways to increase your financial fitness, such as reducing debt, saving for an emergency, or investing more in retirement.

To track your progress moving forward, continue to use the budget template. There are also software programs available, such aswww.Mint.com , Quicken, or Microsoft Money, with integrated budgeting tools that can create your budget for you.

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