The steps to follow in creating a budget

[bettercrypto]

It's a good tip you made about budgeting, because this is usually the problem for most communities, not only in the crypto space but also in people's traditional lives. There are many people who have money but are not able to handle it properly.

So, this is something that others should know, so this topic you made can also be a guide for people who want to learn how to handle their budget correctly. So thank you for spending the time just to share this here.

[Darker45]

Sometimes people make budgeting as if one needs a rocket science degree in order to do it right. I think budgeting is very simple. It's probably just a matter of common sense. Live a simple life. Avoid an unnecessary lavish life. That's it. If you are still having a hard time budgeting what you have despite living a simple life, then that means you need to find ways to increase your income. Now, that's probably the harder and complicated part.

[barisbilgili]

It's a good tip you made about budgeting, because this is usually the problem for most communities, not only in the crypto space but also in people's traditional lives. There are many people who have money but are not able to handle it properly.

So, this is something that others should know, so this topic you made can also be a guide for people who want to learn how to handle their budget correctly. So thank you for spending the time just to share this here.

Of course, it is very important to manage finances to be able to find out about the expenses we have, whether we have used them for the purposes we really need or not, because if we don't have financial management, of course we won't be able to have savings and investments will always be insufficient income. that we have if we cannot manage our finances well.
What you say is very true, no matter how much money we have, if we cannot manage it well, of course we will still be like people who don't have money and will also not be able to meet the needs we need.

[Hewlet]

Marry Christmas and happy new year.
 It comes to me to share my knowledge with others, but I am sure some might know the steps in creating a budget, but it might be that they are not following it effectively. I hope if I share such knowledge, it will help a lot, especially in the season we are in now. I know that as we have already celebrated Christmas, we have spent much of our savings, which we are still going to spend more on when it comes to the New Year celebration, so I take this as a reason to share such information with others so others will not suffer, especially after all this celebration, so I will list and explain the steps in creating a budget.
 
The steps in the budget include

1. Determine your income: As the first step in creating a budget, you have to know your total income in terms of what you can afford. Do not write a budget that is more than your income and end up not achieving anything at the end because your income determines your budget, so let's take note of our income first. This income might include your weekly,monthly, or even yearly income, as well as side hustles and any other source of income.
 
2. Identify where your money is going: The second step in creating a budget is to track your expenses. This is also very important because, without knowing how you usually spend your money, you will end up writing a budget that you can’t even stick to. More over, expenses include housing, transportation, food, entertainment, gambling, and so on. When you have identified where your money is going, you can categorise it into groups. For instance, clothing, house rent fees, and others should all be in the category of housing. If that is done, you have definitely achieved your second step in creating a budget.
 
3. identify or set an achievable goal: This is the third step in creating a budget when you have identified your income, tracked your expenses, and categorised them. Why I say achievable goal is that you have to set a goal that you can achieve either long-term or short-term. For instance, you might save money in order to pay your debts, invest the money, or even pay for housing and any other expenses, such as buying valuable and usable items that won’t be a liability to you.
 
4. Start creating the budget or priorities for your expenses: This is the next step, for me. This is the step where you will start writing the budget. It is not that you won’t write those other steps I mentioned earlier; you will also write them, but this is the stage where you will allocate some amount of money to the categories that you have created at the second step, and you have to make sure that it aligns with your priorities. After allocating a certain amount of money to those categories, you should make sure that you keep some of it as emergency funds; it is also important.
 
5. Review the budget; in some cases, I mean monitoring, evaluation, or adjustment of the budget. This is like the final stage in creating a budget, although this stage is a continuous process because this stage never comes to an end unless you have purchased all that you have put in your budget to achieve this process, including regular adjustments as needed to accommodate and adjust your budget. This is done in case something comes up, such as the use of the emergency fund that you keep as a category for things like an increase in the price of what you intend to buy for medical expenses, which might be an emergency, and many others. In this step, you must track your budget very carefully and with caution to make sure you have achieved it.
 
The steps I have listed above are the ones I follow whenever I want to write a budget. You can change this step in many ways. For instance, a gambler can use it, but it will be more effective with the amount he needs for the gambling, and he should make sure he follows the track, so stick to the budget to avoid the source of unusual spending.
 

I think that thee way you structured the title of this thread and the content of the thread had not done more justice to the required intention behind the thread. Maybe being more detailed on what you mean by setting up a budget could have helped me understand the context of what you are trying to say. When you talk about setting a budget, I guess it's more of setting out an amount you will be spending out of your earnings or the amount you will be saving out of your earning right?

Setting budget in either of those cases is very necessary as it would help you avoid unnecessary spending and will also go a long way in increasing your savings and reducing unnecessary spending.

[Egii Nna]

Marry Christmas and happy new year.
 It comes to me to share my knowledge with others, but I am sure some might know the steps in creating a budget, but it might be that they are not following it effectively. I hope if I share such knowledge, it will help a lot, especially in the season we are in now. I know that as we have already celebrated Christmas, we have spent much of our savings, which we are still going to spend more on when it comes to the New Year celebration, so I take this as a reason to share such information with others so others will not suffer, especially after all this celebration, so I will list and explain the steps in creating a budget.
 
The steps in the budget include

1. Determine your income: As the first step in creating a budget, you have to know your total income in terms of what you can afford. Do not write a budget that is more than your income and end up not achieving anything at the end because your income determines your budget, so let's take note of our income first. This income might include your weekly,monthly, or even yearly income, as well as side hustles and any other source of income.
 
2. Identify where your money is going: The second step in creating a budget is to track your expenses. This is also very important because, without knowing how you usually spend your money, you will end up writing a budget that you can’t even stick to. More over, expenses include housing, transportation, food, entertainment, gambling, and so on. When you have identified where your money is going, you can categorise it into groups. For instance, clothing, house rent fees, and others should all be in the category of housing. If that is done, you have definitely achieved your second step in creating a budget.
 
3. identify or set an achievable goal: This is the third step in creating a budget when you have identified your income, tracked your expenses, and categorised them. Why I say achievable goal is that you have to set a goal that you can achieve either long-term or short-term. For instance, you might save money in order to pay your debts, invest the money, or even pay for housing and any other expenses, such as buying valuable and usable items that won’t be a liability to you.
 
4. Start creating the budget or priorities for your expenses: This is the next step, for me. This is the step where you will start writing the budget. It is not that you won’t write those other steps I mentioned earlier; you will also write them, but this is the stage where you will allocate some amount of money to the categories that you have created at the second step, and you have to make sure that it aligns with your priorities. After allocating a certain amount of money to those categories, you should make sure that you keep some of it as emergency funds; it is also important.
 
5. Review the budget; in some cases, I mean monitoring, evaluation, or adjustment of the budget. This is like the final stage in creating a budget, although this stage is a continuous process because this stage never comes to an end unless you have purchased all that you have put in your budget to achieve this process, including regular adjustments as needed to accommodate and adjust your budget. This is done in case something comes up, such as the use of the emergency fund that you keep as a category for things like an increase in the price of what you intend to buy for medical expenses, which might be an emergency, and many others. In this step, you must track your budget very carefully and with caution to make sure you have achieved it.
 
The steps I have listed above are the ones I follow whenever I want to write a budget. You can change this step in many ways. For instance, a gambler can use it, but it will be more effective with the amount he needs for the gambling, and he should make sure he follows the track, so stick to the budget to avoid the source of unusual spending.
 

I think that thee way you structured the title of this thread and the content of the thread had not done more justice to the required intention behind the thread. Maybe being more detailed on what you mean by setting up a budget could have helped me understand the context of what you are trying to say. When you talk about setting a budget, I guess it's more of setting out an amount you will be spending out of your earnings or the amount you will be saving out of your earning right?

Setting budget in either of those cases is very necessary as it would help you avoid unnecessary spending and will also go a long way in increasing your savings and reducing unnecessary spending.

If you could go back and read the context of this topic, you would understand that I am not talking about a certain amount of money you are going to spend or even how to increase your savings. I am not saying that if you write a budget, you won’t save. No, creating a budget will help you save more than you expected.
  So if you could read well and understand, you will know I am just talking about steps on how you create your budget based on your income and your expenses. I will advise you to read and understand the context before you can reply to or criticise a topic.

[mirakal]

A very useful post.  All of us should have an ideal budget plan before the start of the year.  All of us will benefit a lot if we follow these rules and plan our budget.  Before the budget plan, it is right to think about our income and expenses.  Uncontrolled travel expenses drag down our finances.  Planning is very important to manage life well.

If you want to be happy in life, everything must follow the rules. If a person moves outside the rules or spends money, he will have to face many problems at some point. For example, due to spending extra money, he may run out of money at some point or even bigger.  If we can follow the rules then we can organize our life very nicely. There are some people who spend extra without accounting for anything they have to face a lot of problems. If we try to calculate them  If I do, I don't think there will be any problem.

However, some instances may prevent us from following these rules. Unpredicted events may suddenly happen and yet our budget cannot cater those emergency needs, hence we end up crossing the rule and touching the budget we're not suppose to use. But if we have saved emergency funds, I think our budget will not be put into compromise. There should be different budget funds that we need to consider, and sticking to each budget will make us live stress free and happy.

It takes discipline to make a budget works. Otherwise, your budget plan will be useless since you're not even following it in the first place. Patience and discipline are the keys.

[erep]

However, some instances may prevent us from following these rules. Unpredicted events may suddenly happen and yet our budget cannot cater those emergency needs, hence we end up crossing the rule and touching the budget we're not suppose to use. But if we have saved emergency funds, I think our budget will not be put into compromise. There should be different budget funds that we need to consider, and sticking to each budget will make us live stress free and happy.

It takes discipline to make a budget works. Otherwise, your budget plan will be useless since you're not even following it in the first place. Patience and discipline are the keys.

Everyone has different financial levels based on their daily income or monthly salary, although discipline in following these rules will not achieve maximum results. For example, if their financial level is low, maybe they set aside some of their income for emergency savings every week or month, but emergency savings will also not meet the required budget.

However, at least those who have implemented financial management rules will be useful in the future, even though they cannot fully cover emergency needs if an unexpected event occurs but already have part of the budget for emergency needs.

[tottong]

The steps I have listed above are the ones I follow whenever I want to write a budget. You can change this step in many ways. For instance, a gambler can use it, but it will be more effective with the amount he needs for the gambling, and he should make sure he follows the track, so stick to the budget to avoid the source of unusual spending.

Saving a budget to spend will be much more difficult, especially if someone is not used to living in simplicity.
The level of effectiveness may vary from one person to another. For example, if our needs are at the stage of fulfilling daily needs then only in that area we need to prepare.
It will be different when someone owns a business because the need for money will be much more unstable for the needs of developing or rejuvenating the business.
Preparing your finances to be better is not easy because we are required to look for a much more productive place to make money. If the placement of money is not in accordance with the desire to obtain profits, then the money will not work to produce profits.

[traderethereum]

However, some instances may prevent us from following these rules. Unpredicted events may suddenly happen and yet our budget cannot cater those emergency needs, hence we end up crossing the rule and touching the budget we're not suppose to use. But if we have saved emergency funds, I think our budget will not be put into compromise. There should be different budget funds that we need to consider, and sticking to each budget will make us live stress free and happy.

It takes discipline to make a budget works. Otherwise, your budget plan will be useless since you're not even following it in the first place. Patience and discipline are the keys.

Everyone has different financial levels based on their daily income or monthly salary, although discipline in following these rules will not achieve maximum results. For example, if their financial level is low, maybe they set aside some of their income for emergency savings every week or month, but emergency savings will also not meet the required budget.

However, at least those who have implemented financial management rules will be useful in the future, even though they cannot fully cover emergency needs if an unexpected event occurs but already have part of the budget for emergency needs.

As long as we continue to carry out our plans and manage our finances well, we don't need to worry about anything. We will not experience difficulties, especially if an emergency requires money because we have allocated a certain amount of funds for that need.
We have to be able to allocate income to the places we have noted to manage the money effectively.
This will give us the freedom to use our money according to our portion and will not interfere with the money used for other needs.
But this requires practice to get used to managing our finances so that everything can run well. By managing our income sources, we can continue to survive even in difficult situations and conditions.

[kryptqnick]

If someone clearly has enough income to cover expenses, I think starting from income, as the op suggests, can be a good idea. But if one is currently living off savings, I think one should start with determining the realistic minimum monthly expenses (mainly, the rent, the bills, food costs, transportation costs), and then consider how much one is earning vs how much is required. This can help set simple goals of what kind of job a person needs to cover the expenses. And then the excess can be used for other achievable goals.

[Marvelman]

Having some kind of plan for your budget is really helpful for keeping your finances in order.  You gotta list out your priorities by how important each thing is for reaching your goals.  If you try to do too much without a strategy, it usually ends up being counterproductive. 
I've definitely learned that lesson the hard way more than once! So taking some time to map out what matters most can save a lot of headaches down the road and  you don't need anything super rigid or detailed.  Just figure out the key things you want to focus on and go from there.

[Twentyonepaylots]

Sometimes people make budgeting as if one needs a rocket science degree in order to do it right. I think budgeting is very simple. It's probably just a matter of common sense.

I agree, people these days be freestyling their daily budget as if they are just picking up their money on the floor. Budgeting should be realistically set using the common sense, living without a daily budget is like living in borrow time.

Avoid an unnecessary lavish life. That's it. If you are still having a hard time budgeting what you have despite living a simple life, then that means you need to find ways to increase your income. Now, that's probably the harder and complicated part.

Diversifying is the best way to counter or align your budget, do not settle for one source of income, try to explore more rooms where you can generate profit even it is a small business or lesser income than your main source. I don't think it is hard to find, well maybe it is at first but once you find it, you can prolong it or best you can add more to it. Luxury these days doesn't apply to all, if you can't afford don't buy it, it is a very simple logic.

[alastantiger]

The steps I have listed above are the ones I follow whenever I want to write a budget. You can change this step in many ways. For instance, a gambler can use it, but it will be more effective with the amount he needs for the gambling, and he should make sure he follows the track, so stick to the budget to avoid the source of unusual spending.

This like a KISS method. Keep It Super Simple. If someone with some experience in this can, I'd be like to have an answer to this budget question that has always been on my mind from my finance class, what if you come into extra money for instance like a tax refund or financial aid refund. Do you add into your income?

[Lida93]

Sometimes people make budgeting as if one needs a rocket science degree in order to do it right. I think budgeting is very simple. It's probably just a matter of common sense.

I agree, people these days be freestyling their daily budget as if they are just picking up their money on the floor. Budgeting should be realistically set using the common sense, living without a daily budget is like living in borrow time.

When we give importance and value to the money we earn we lavish it on every luxurious item that comes to mind. The first step to be fervent in setting a budget and sticking to it is by giving value to any amount of money we earn. For with value to our money all other steps to a healthy budgeting is seamless.

Avoid an unnecessary lavish life. That's it. If you are still having a hard time budgeting what you have despite living a simple life, then that means you need to find ways to increase your income. Now, that's probably the harder and complicated part.

Diversifying is the best way to counter or align your budget, do not settle for one source of income, try to explore more rooms where you can generate profit even it is a small business or lesser income than your main source. I don't think it is hard to find, well maybe it is at first but once you find it, you can prolong it or best you can add more to it. Luxury these days doesn't apply to all, if you can't afford don't buy it, it is a very simple logic.

The solution to surviving this hostile economic time is having as many streams of income as you can handle and be efficient at it. A single income flow can be daunting and no matter how big the amount from a single source might seem like it is not a hedge to feel comfortable about. What if a an incident took place leading to the pause or totally stop of the source, what or where will you fall on for survival unlike when you're with a multiple income source?  Multiple streams is the only hedge to all the effect of the  economic recession we are currently facing.

[Lanatsa]

Start creating the budget or priorities for your expenses
# This would really be the key for you to survive yourself and able to handle up well when it comes to the money that you are earning on which trying out to have that budget allocation
on which you would really be setting it on to priorities on which it would be that normal. If there would really be some unexpected spending then this is where savings allocation would take place.
This is why it would really be that recommendable that you should really be having that kind of allocation whenever you do get that pay.

It is really just that a matter of control and discipline towards one self on handling your finances because if you dont make yourself that at least realistic or being that mindful about the future
then you wont really be bothering yourself on taking up some actions but instead you would really be just that focusing on the things that you would really be that tending
to deal with.

Just simply live and deal up on the things that you are really that wanting into and of course everything should really be in moderation and never ever considering yourself
on spending that much which is way more than on what you do earn because this is where usually people do mess up, on the time that they would be having
those kind of spendings which is that more than that they could earn which is really that too absurd.

[freedomgo]

It's a good tip you made about budgeting, because this is usually the problem for most communities, not only in the crypto space but also in people's traditional lives. There are many people who have money but are not able to handle it properly.

So, this is something that others should know, so this topic you made can also be a guide for people who want to learn how to handle their budget correctly. So thank you for spending the time just to share this here.

People mismanage their money because their goals are not fixed, and they have no enough knowledge how to save and get rid of unnecessary expenses. When people have tons of money, living their present is like there's no tomorrow and just spend everything they can in  just for a day, hence making these people  turn into one day millionaire, and struggle after.

Creating a budget seems so easy but in reality, hard to do and process. Mostly because people are only good at planning but have no real discipline to stick to their plans and make them succeed.

[bhadz]

You have forgotten the simplest and most basic thing of creating a budget but it's one of the most important thing and that's to list all of your expenses and where your budget is going. With that, you'll be able to track your expenses and you know where it will be spent. Because if you don't have that list and you're good at the other things, how are you going to track them all? You've listed about #4 as creating and writing the budget but I think that should be at the top together with determining your income/expenses.

[Viscore]

Like they have said that he who didn't plan has already planned to fail and this is why we have some businesses springing up but they are not succeeding because of lack of proper guide and management. Budgeting is one of the leading factors to business and it growth.

A business person who knows what he is doing, would take stock of his business from time to time and make plans to growth it. Businesses are not handled into success for the lack of proper budgeting, even the government budget on how to carry out his capital projects and recurrent expenditure. Budget determines how far the business will grow or how soon it will crash also depends on lack of proper budgeting.

Without proper budgeting, all successful businesses are doomed to fail. That is already expected much more to those high rising businesses where extreme budgeting is a must. If you fail on that, the whole concept of business will fail as well. So put budgeting as the topmost priority when aiming for success and long term profits.

However, budgeting can always be learned if you have the eagerness to study on it. Sometimes, it takes losses at first before you will see the high importance of budgeting, and that's normal as long as you also learned your lesson.

[bitzizzix]

Marry Christmas and happy new year.
 It comes to me to share my knowledge with others, but I am sure some might know the steps in creating a budget, but it might be that they are not following it effectively. I hope if I share such knowledge, it will help a lot, especially in the season we are in now. I know that as we have already celebrated Christmas, we have spent much of our savings, which we are still going to spend more on when it comes to the New Year celebration, so I take this as a reason to share such information with others so others will not suffer, especially after all this celebration, so I will list and explain the steps in creating a budget.

Thank you for taking the time to come up with these wonderful budgeting tips. It is vital to measure your income with your expenses and see the outcome. If you can save some money no matter how small after paying for your expenses, you have a good budget. But if you have to borrow to finance some of your expenses, then you have to readjust your budget.

I am not moved by festivals or holidays like Christmas. I still ensure that I spend within my means. If I don't have extra funds to finance house decorations, new clothing, or travelling for vacation,  I will have to drop them from my budget because they are not basic needs. I have always told people that we have to enjoy Christmas based on what we have and we should never borrow because we want to celebrate Christmas in a big way more than what we can afford. We shouldn't lose sight that January comes with a whole lot of bills.

Borrowing money just for additional needs such as for Christmas will only add new problems and after the Christmas holidays are over there will be lots of bills that will make us have to work even harder. spending something must be adjusted to financial capabilities so that there will be no such thing as a shortage of funds, everything must be arranged so that the available funds must be sufficient.

Of course borrowing to celebrate holidays or the new year will be a new disaster at the start of the new year, and this should not happen because it will make us dizzy after the money borrowed is used up just for a moment's enjoyment.
Celebrating Christmas and New Year according to our abilities and with the abilities we have, we can definitely celebrate it well and happily with our family, and wise people will plan the celebration of the big day or New Year by planning it well in advance. And they make a strict budget before the big day arrives, so that they can celebrate well and have enough money for all their needs and also a simple holiday for their beloved family within the existing budget.

[pusaka]

Like they have said that he who didn't plan has already planned to fail and this is why we have some businesses springing up but they are not succeeding because of lack of proper guide and management. Budgeting is one of the leading factors to business and it growth.

A business person who knows what he is doing, would take stock of his business from time to time and make plans to growth it. Businesses are not handled into success for the lack of proper budgeting, even the government budget on how to carry out his capital projects and recurrent expenditure. Budget determines how far the business will grow or how soon it will crash also depends on lack of proper budgeting.

Without proper budgeting, all successful businesses are doomed to fail. That is already expected much more to those high rising businesses where extreme budgeting is a must. If you fail on that, the whole concept of business will fail as well. So put budgeting as the topmost priority when aiming for success and long term profits.

However, budgeting can always be learned if you have the eagerness to study on it. Sometimes, it takes losses at first before you will see the high importance of budgeting, and that's normal as long as you also learned your lesson.

Everything will start with planning and one of the things in the planning is the budget. The budget is one that must be carefully thought out and prepared, because it will greatly determine the success or failure of the business that we will run. And don't forget to always budget for reserve funds, because not all businesses run smoothly at the beginning and often require an injection of funds. Not only at the beginning, when it is successful and advanced, sometimes something unexpected can happen.
I remember when Covid came, it came unexpectedly and a lot of businesses were destroyed because of it, if you are not ready with spare money then it is certain that the business we run will not survive. I listened to a friend's story who had to maintain his business and he did everything he could including selling his assets and getting into debt, I was shocked when I heard the amount. From there I can learn that reserve funds are indeed very important in doing business.