It really doesn't matter how big the numbers are the process is pretty much the same. It takes time, discipline, patience and will power. The basic parts of the process are:
1 Know what you spend now.
2 Know what you make now.
3 Allocate money to all categories.
(Don't ignore saving, investing and giving. They are vital to the overall picture)
4 Compare your expenses to revenue.
5 Make adjustments to balance the budget.
(These adjustments have to be made in how you live not just on paper)
6 Live within the budget
7 Adjust the budget as needed
The budget is not a document you create and put away. It is a guideline for living daily. Sometimes we need to adjust it to a change (job, family, etc...) that occurs. Other times we need to change it because our short term goals have changed.
I know you are thinking as I have many times, "this budget thing is a pain, I don't want to WASTE the time. I can get everything paid for without it." You are right, most of the time you can pay your bills and live without harassing phone calls without a budget. But the real purpose of the budget is to set up guardrails that help keep you on the path to your goals. That's right a budget should be based on your goals. If you have a goal of "retirement" (we'll talk later) or sending the kids to college or property on the lake or giving 15% to the church, you must have a plan to get there or it will always be just a wish.
Budgeting is how these wishes become reality.
For more info: www.crown.org
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