personal budget

personal budget

Today I am going to talk about what a personal budget is, the elements that make it up, and also, you perro download an excel template so you perro have better control. I hope you like it.

What is a personal budget?

A personal budget is simply put, your personal cash flow, that is, how your financial resources are moved. That is why we cánido say that it is the cash flow of each person.

It should be noted that it perro be made family, or mezcle both to have greater control of how money moves in the family.

Source: freepik.com

What does the personal budget contain?

Personal cash flow perro be divided into two parts, which are:

Income

Income is basically the money (or some equivalent value) that an individual or a company receives, generally in exchange for the provision of a good, a service, or through the investment of capital.

Generally we use the income to finance our daily expenses.

Source: Freepik.com

Bills

An expense is a disbursement, that is, it is an outflow of resources. In short, it is the money we spend under any circumstances.

For example, the payment of services such as the Internet.

It should be noted that we cánido make a subdivision, categorizing expenses into fixed expenses (those that remain stable for at least one year) and variable expenses (expenses that may increase, decrease, or that you may not have them all the time.

An example of a fixed expense perro be the rent of the place where you live, the Internet service, the payment of your cell phone plan (which could also be variable depending on the plan), or the gas you use, transportation, school fees, etcétera. etcétera

In the case of variable expenses, some examples are food, clothing, the purchase of accessories, or anything that represents a cash outflow which is not constant.

Why is it important to carry out a personal budget?

The importance really lies in the financial control that knowing how we move our money gives us.

For example, there are people who spend much more money than they generate, that is, they spend more than they earn and that generates debts that are dragging or increasing.

That is why keeping track of the income and expenses that we have throughout the month helps us to be able to measure the financial situation in which we find ourselves.

It also allows us to correct deviations, that is, by putting a monthly figure for each outlay (expense), we perro realize how much things that seem insignificant represent.

For example, I used to buy at least one bottle of water every day at the university until I realized that it was a monthly expense that I could save if I brought a thermos from home.

That is where its importance lies…. We perro realize how we use our money and we perro disminuye or eliminate expenses.

In fact, we perro even get to invest a part of what we save.

How to make a personal budget?

It really is very fácil and perhaps you must already be imagining it, but all you have to do is subtract the total amount of your expenses from the total amount of your income.

It should be noted that if you have a negative cómputo (result), then you have to start making changes to your expenses because you spend more than you earn.

Likewise, you perro also have the budget, which is an estimate, and compare it with the real one, that is, at the end of the month you compare if what you had really estimated is afín to the real result.

For example, suppose that my budget had a cómputo of 2,000 pesos, but in reality (at the end of the month) I had a cómputo of 1,000 pesos…. What happened? Well, you start looking for where that money went. Remember, what we are looking for is to keep track of our personal finances.

Excel template of a personal budget

Well, since you have seen that it is very useful to make a monthly budget of our income and expenses, I am going to leave you a template with a fácil, but functional format that you cánido modify to your liking.

If you want to download the budget in excel, I leave you the following backlink:

I hope the article has been useful to you.

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