Family Budget : A Right Step Towards Financial Freedom
“The fact is that if you have a figure in your mind that you know you cannot exceed, you gain some kind of psychological strength that deters you from those things that can land you in financial trouble.”
If you have a family, you better become a responsible person. Financial responsibility is an important part of your family responsibility. After all, money may not be every thing in life but it surely is a social necessity and obligation.
Financial freedom can only be possible if you have a check on your spending and you keep an eye on our habits and your earnings in general. For this purpose, a family budget often comes in handy.
The first step is that you should have an exact figure regarding our monthly income. If you get or are to get an income that is apart from your monthly income, you should take that amount for whole of the year divide it by 12. Add this to your monthly income so that you get an idea as to which income bracket you fall in.
It will go a long way in controlling your spending and improving your habits. Some people consider this just a waste of tiome. The fact is that if you have a figure in your mind that you know you cannot exceed, you gain some kind of psychological strength that deters you from those things that can land you in financial trouble.
After calculating your income, you should enlist all your expenses. Start with those that occur on a regular basis. Your house rent, EMI of your house loan, fees of children etc. fall in this category. Similarly, you should keep an eye on your credit card right in the beginning of the month and make it certain that you are able to pay the bare minimum due.
Then calculate the various taxes or premiums that you have to pay on annual or semi-annual basis. You should have a clear idea as regards the amount that you would have to invest in various government and non-government schemes in order to be exempt from taxes.
This amount should be subtracted from your monthly income right away. Or, you should subtract the amount that has to be given through taxes, in case you not interested in tax exemption. But as common sense would say, unless absolutely necessary, you must always become eligible for tax exemption.
Then, you should add those expenses that keep on occurring off and on and reach a final amount. In this way, your family budget would become a realistic one and you would never land yourself in financial doldrums.
Author - DeeKay
Tags - Finance, Economy
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