Income

You may have noted we started with expenses instead of income. There was reason for this. While income is generally quicker and easier to jot down and total up, by doing so just before you determine how much you spend on takeout and clothing may influence those numers into thinking you couldn’t possible sustain that much spending given the amount you have to work with. And that’s likely true.

If you’ve made it to part 3 in this series you’re probably trying to create a budget BECAUSE you’re overspending and losing control of your finances. Which can be extremely stress inducing. So while you still have some tasks left and possible sacrifices to make… we’re on the path to real financial planning. Lets take a deep breath and move on to Income.

• Salary or wages
• Tips or Commission
• Passive Income and Investments
• Annuity, child support, pension
• Side Hustles
• Government Payments (tax returns, government assistance, social security)

Note down the amount, when in comes in and the frequency in which it comes. For instance side hustles may look like snow blowing November through April for a total of $$$. Or commissions and tips could be broken into busy and slow seasons. Just note write down how much you’re depending on, when it comes in and how often you see it.

That’s it for task #2. Next we’ll be determining what unit of time you’ll be comparing immediate income to expense ratios. And possibly how to balance the two so you aren’t spending more than you’re earning.

Take me to task #3