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Trash Your Budget and Become Financially Independent

Annoyed with Your Budget?

How much money do I have left in my wallet? What about my bank account? Should I use my credit card or cash, since I don't want my wife to know what I am buying? Why can't I even allow myself to enjoy a Latte just because it's not on the budget. This whole budget thing is a bunch of rubbish. From today, I resolve, I am trashing it. No More Budget!

If you feel like that sometimes, you are not alone. There are millions of us out here that want this anti-budget revolution. Besides, even governments all over the globe grapple with the same budget issue. Churches have been known to close - "no more mission trips pastor, no more evangelism, no more baptism, no more church choir, you have exceeded the budget allocation." I am sure some parents can think of times they entertained the thought of postponing the kids' birthdays - "sorry David, you are not turning ten this year."

Do budgets work at all, or is it an illusion preached by so many business schools?

I think so many of us have been taught to believe and think that we need a budget to manage our finances. That we need a budget to manage our lives. We need one to prosper and become financially independent. How come we breath without a budget on the air supply, or is there one? or budget how many times in a day your eyes must blink, failure to which, you'll run out of blinking for the next two weeks, until the next budget. And, I am not saying this just to be comical. Many people struggle with budgeting and yet we insist it must be used.Personally, I have struggled to come up with an elaborate budget, later on religiously follow it.

If budgeting comes naturally to you, God bless your soul. But for most people, it's a constant struggle that continues to bring disastrous results. People are living under stress because of being too hard on themselves for not sticking to their budgets. Marriages and partnerships have ended because of budgeting. I know, you will be tempted to say, maybe they broke up because they didn't stick to a budget. Off course they didn't, and that's my point. Why insist on something that isn't working for you. Why not find something workable instead. Something that will inspire you to follow unconsciously.

Budgets are meant for people, not people for the budgets. You have to control the budget, not the budget controlling you. You have gotten it all twisted and that's why you continue to be under stress. It's a guide. So, if it doesn't lead you where you want to go, toss it. The idea of a budget is meant to protect you against yourself. Anything that is made to protect you against yourself is unsustainable. True growth, has to come from within. You have to grow your capacity for control and a budget wont change your personality.

If you love shopping, a budget will be your stumbling block, and whether you choose to shop or stick to your budget, either way, you'll still be frustrated. Budgets don't generally work because they are not fun. Anything that takes away your happiness cannot truly help you. And, don't get me wrong, I am not advocating for recklessness with your money. I am of the view that a budget is not what you need to take control of your finances or to put your life on track. Soon, I'll explain what I have discovered works for me. This isn't my original idea, but It was made clearer to me when I read a little book by David Bach called the "The Automatic Millionaire."

There is a better way to putting your life on track towards financial independence.

It's called a system. Put a system in place that will do things on your behalf and you are on your way to true freedom.

1 - "Pay yourself first." and this can take many forms. Paying yourself first entails taking a percentage of your income and invest it before you even pay taxes and bills. Chances are, you already know how much you require to make a living from your income. Make sure you have it done on your behalf before you even see the money. In short, let your employer or bank do the job for you. With the Internet bringing so much convenience, you don't need to worry about forgetting to pay your bills, credits, rentals, etc. Instruct the bank to do it automatically.

2 - Have some fun. Once you have cleared this huddle of handling money using an automatic system that does consistently what you desire, it's time for some fun. All work without fun, made Joe a dull boy. Take yourself and some friends once in a while to some nice restaurant. Buy yourself the toy you desire. After all you deserve it. Surprise your loved ones. Enjoy life with less stress, while having a goal big enough to inspire you.

3 - Stop buying things on credit. If you can't pay for something with cash, you can't afford it. Period. For heavens sake don't even think of getting more credit cards. If you bought your Flat screen TV using your credit card, let it be the last time you did such a silly thing. Commit to fully pay off your credit cards and ensure you pay more than the minimum monthly payment. You cannot build your financial future on debt. The only debt you should have is one that helps you make money- like real estate debt. Make the payments automatic.

4 - Watch the little things. You can save a lot of money baking your own bread. You don't need a muffin or marble pound cake every morning from Starbucks. My wife and I started baking our own healthy bread and buns and we have saved substantially ever since. This may not appear to be a lot when you are looking at your receipt, but over time these small expenses compound.You'll beat yourself once you discover they are equivalent to your month's rentals after half a year.

5 - Cancel some of those unnecessary cable channels, next generation phone plans which you don't even know what they mean (what's 4G?), or gym memberships that you never use. Stop buying bottled water, diet this-diet that - stop obsessing over counting calories and start running or walking, join some sport, dancing club or whatever. Do something physically active. No one loses weight counting calories. You have to be active and actually do something. Learn to cook your own meals and only go out when you have to.

6 - Throw away all your old budgets that will remind you of your prison days. Unless budgets work for you, don't impose them on others. Stick to your plan and let the automatic system do the work for you.

If you are serious about investment advice, I recommend that you buy the little copy "the Automatic Millionaire - A powerful One-Step plan to Live and Finish Rich." by David Back. I am not in any way affiliated to David or his company in case you think I am advertising for him. I bought the book, read and applied some principles from it. They worked and continue to work for me.

For now, don't beat yourself if you are failing to stick to your budget. Trash your budgets and get on the automatic anti-budget system. Welcome to true freedom!

Budgeting Software

One of the most effective ways of handling your personal finances is to make a budget of all your expenses and your income for a given period of time. Doing so will make you aware of your financial standing and enable you to plan your purchases. It can also help you avoid the hassle of being unprepared for unexpected spending.

Given the advantages of making a budget, software companies have developed software that people can use on their computers to make the process of making a budget easier for their clients. In picking out budgeting software that will best fit your needs, you need to consider a few things. Below are a few tips that can help you pick out the best software for you.

What to look out for

One of the most important things you should consider when buying budgeting software is the ease with which you can install the software and transfer all your accounting information into the program. This is very important because in order for your budgeting software to be able to help you in your finances, you must be able to put in all the necessary information with a certain level of ease so that you will not waste valuable time in transferring data into the program.

Another important consideration is that your budgeting software must be able to deal with different currencies, as this will make your international transactions easier to undertake.

Another thing you should look out for is accessibility. Using software that can be accessed by an auditor or an accountant is a good idea so that they can verify your data. You should also get software that will churn out the records or the documents that you want, which may be a quarterly budget and/or your tax computations.

You should also try to get software that will allow you to do some forecasting so that you can do come future planning that is based on your current and expected financial status.

Lastly you should also use software that will make your financial status information secure from people who you do not want to have access to it.

Where To Find Budget Travel Bargains

There is only one reliable place to find good budget travel and that is online. The internet has opened up a whole new universe of travel for those who are stuck on a pretty tight budget. Not everyone can afford to go on a month long vacation to the South of France but most of us can make good solid use of budget travel.

When you do your travel shopping online you will find that you can afford much more than you thought you could. It is easy to find some good budget travel on the internet these days. All of the travel companies are throwing out some good packages for people with not much money to spare and some of the budget travel packages even include some meals. That is my idea of full service travel plans!

When it comes to budget travel you do have to watch out for a few things. For example, what kind of trip do you want to take? When it comes to budget travel the airlines can vary drastically. Some of the budget travel airlines are great, they are friendly and they are clean and fantastic, others, well, not so much. You should take some time to research about the different companies you are considering for your budget travel before you actually book anything. This will make a huge difference in the kid of trip that you end up being able to take.

Online you will be able to find all kinds of consumer reviews about budget travel companies, airlines and even cruises. Read through these carefully to find some great budget travel ideas. With these useful tips you will learn the best places to go for budget travel and the places and companies to stay away from in your traveling. There is no better, more reliable source for info than from people who have been in your shoes. They have nothing to lose by telling the truth so they do, they will tell it just like it is and that is what you need to help you make the right budget travel decisions.

Chances are that if you do all of your planning and booking online your budget travel is gong to be even cheaper. This is simple to do as well. Most of the major travel companies have everything you need online and they walk you right through it all. And if you have any trouble just contact them and they will help you out. There is nothing simpler or faster than booking your budget travel online these days. That is why the business is booming the way it is.

Each and every year the budget travel industry online grows and grows and it is not showing any signs of slowing down in the near future, that is for sure. So the next time you want to take a trip check out budget travel online and see where that takes you.

Creating and Using a Budget

With the state of the economy, it pays both literally and figuratively, for a consumer to be thrifty. Both creating and implementing a budget can assist in helping a consumer cut unnecessary spending while stretching their paycheck longer. Producing and utilizing a budget can also help eliminate the financial pain of unforeseen bills by giving a means of saving money productively for just these occurrences.

One important element of creating a budget is establishing what bills you exactly have. Understanding what bills one has to pay every month is paramount to creating any budget. Get together any phone bills, car bills, groceries or utilities that must be paid every month. You'll also want to include bills that change month to month. In the first few months of a budget you might have to make an educated guess, but as time progresses you might be able to make a more accurate assessment. This will give you a rudimentary knowledge of where your paycheck is going each month.

The next step is to identify all of your sources of income. Do you receive child support? Do you receive money outside the confines of your regular employment? Any means that you receive money each month should to be listed just as any conventional source of money would be. This will help to show how much money you spend and save each month.

Now that you know how much money you make and spend each month, you then need to evaluate how you're spending your money. Truly evaluating where your money goes each month helps to show trends in spending that you might not even be aware you have. Are you eating out often? Are you spending a great deal of money on things you might not need? It's very easy to lose track of just how much your spending money on purchases or goods that you don't truly need.

Once all of this accomplished, you might want to consider what your goals truly are. If your goal is to save more money, than you might do well to allow a certain amount of monies for entertainment or purchases that are wants as opposed to needs. You also might want to allow money off the top of the budget if you wish to save some.

Now that you've established what your goal is in creating a budget, you'll want to add these expenses together to show a monthly total. This total amount will be compared to how much you bring in monthly to pay these bills. The ideal situation is to have more income coming in than expenses being paid out. If your budget shows the opposite, than you'll want to concentrate on what expenses can be adjusted to make the budget fit your lifestyle.

The final and most important step to creating and implementing a budget is to physically write the information down. Any money spent should be accounted for in the budget. You'll find that overtime you'll see valuable information on where your monies are being allocated. This can help you to reach whatever your budget goals are. This will also assist in being able to adjust your budget according to where you wish to be because of the budget.

Producing and utilizing a budget, though time consuming, is a great way to help save money for the future. Budgeting books can be found at most convenient stores, or you can even find budgeting forms online to utilize. Either way, creating and effectively using a budget is a much needed tool for money management over time.

Why You Need Money Budgeting Software

With the credit card society we live in today keeping accurate track of expenditures is very important. People forget that they are spending money when using a credit card and in most cases those who use credit cards spend 18-20 percent more on a purchase then if they were using cash. In the end they end up spending more then they can afford.

Because of this many financial experts agree that using a budget can help most consumers start to take back control of their financial situation. A budget gives them the ability to manage their income and expenses and get out of and avoid the debt that plagues most people these days.

Unfortunately many people are budget challenged. They have a hard time just getting a budget started much less following one. They feel that if they just had some help they could more easily come up with a reliable and workable budget.

Money budgeting software was created for anyone interested in making and following a budget, but it can be a great use to those who have trouble setting up and following a written budget. The power of a budget software package is such that anyone can use it and there is almost nothing about their finances that they cannot track.

Today's budgeting software takes all the guess work out of tracking income and expenses, along with credit card bills, savings accounts, mortgages, retirement plans and a whole lot more. With different ways to look at your finances through graphs and spreadsheets you can easily keep track of where your money is going and how to best make it work for you.

Here are three big ways that money budgeting software can help improve your personal or family financial situation.

1. Your can track you expenses very accurately. Budgeting software is very adaptable to each individual situation and will evolve with you as your financial needs change over time. Keeping track of you cash flow, both incoming and outgoing, is of primary importance when it comes to taking charge of your financial future.

2. Future projections. This is one area that budget software excels at. It can give you a look at your financial future if you follow your budget and all it entails. By projecting different budgeting scenarios you can easily choose the type of financial future you wish to have.

3. Take control of your money. Many people work for their money, but once they have their paycheck they do not allow their money to work for them. Without an accurate picture of cash flow it is hard to keep control of your financial situation.

Money budgeting software can give you the control you need to keep your expenses under control. This will give you the ability to have your money work for you in such a way that your financial future will be secure.

Erase Debt - 5 Ways to Wreck Your Budget

It has been said by many financial experts that the best way to erase debt and stay out of debt is to create a budget. Many people have created budgets. Not all work. Here are 5 Ways to Wreck Your Budget if you don't do things right.

1. You Don't Have a Budget

This may seem overly simplistic but not having a budget is the number one way to wreck your budget. You may ask, "how can I wreck a budget I don't have?" A budget is basically an accounting of your income (your money coming in) versus your spending (your money going out). The truth is even if you do not have a formalized budget written down every month, your spending habits have created an "unwritten" budget that is probably ruining your personal finances. Spending without giving it much thought will lead to over-spending and effectively living beyond your means. Every one of us has a set number of dollars coming in and money they spend going out. That is your budget. Whether it is written down or not, it exists. So if you do not have a formalized budget now is the time to create one. Sit down, write it down, and account for every penny coming in and going out.

2. You Don't Have a Realistic Budget

So what is a realistic budget? A realistic budget is one that accounts for the real income you make and the real purchases you make. Let's start with income. Your income may be $5000 per month gross. But that is not the dollar amount you put down in the income box on your spreadsheet. You need to take into account things like taxes and insurance that come out of that gross income. What your want to write down in the income box of your budget sheet is your net income. Income after taxes, insurance, liens, etc. are taken out. Someone making $5000 gross per month is probably netting around $3600 per month. Use real take home numbers. If you use the gross number your budget will be way off and you will grossly over-spend.

A realistic budget accounts for realistic spending habits. The best example is when it comes to budgeting for food. So many people vastly underestimate how much they spend on food. I have seen budgets that have taken into account a $420 monthly car payment but only allocated $50 per week for grocery shopping for a family of four. This is not going to work. Unless you are one of these SUPER coupon savers, that $50 per week is not going to get you far. And let's face it, most of us are not super coupon clippers. So be realistic about your recurring expenses.

3. You Don't Account for Unplanned Purchases

No matter how good you are at budgeting there will always be an unplanned expense. A gift you bought for an unexpected birthday, a dinner out with a friend you just reconnected with, that Christmas Snoopy that dances to Linus' piano song (okay, I just bought this for $19.95). These are items that at the beginning of the month were not accounted for or were not anticipated. But just because your budget did not initially include those items does not mean you can overlook them and not add them to your budget. As the month progresses you need to account for every expense and make sure every dollar gets a name. If you do not you will quickly find yourself over-spending and over-budget.

4. Your Budget Is Not a Living Document

What I mean by this is that your budget changes month-to-month and year-to-year. It must account for lifestyle changes where necessary. Your budget needs to be a living document and be able to adapt to fluctuations in lifestyle, circumstance and income. For example, your April budget will not be exactly the same as your September budget. April you may need to budget for Easter pictures or Spring Break activities. Whereas in September you may need to budget for new clothes for the kids' new school year. Therefore you cannot just copy April's budget for each and every month thereafter and think the budget will remain the same month-after-month.

Even year-to-year it will change. Using the example above of buying school clothes in September, the following September the same child may have graduated and you are no longer responsible for clothing purchases. Therefore last September's budget would not be a perfect fit or match for this September.

5. You Give Up at the First Sign of Trouble

If you are just getting started with budgeting the first few months will be the toughest. You will forget to include debts or you will not budget enough money for food or an emergency will pop up and just throw your budget out of whack. Our first instinct in such situations is to throw up our hands and say budgeting does not work.

Don't give up. Allow enough time to get into some sort of rhythm with your budget until it becomes second nature. This may take a couple of months. For others much longer. Allow yourself at least four to six months time of repeatedly creating monthly budgets to see it work. It will work if you allow it to. But do not quit. The old adage of if you fall off a horse get right back on is very pertinent to your first budgeting experiences. You will make mistakes. Guaranteed. But never give up.

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So to avoid wrecking your budget, first actually create a budget. Make sure you are dealing with realistic numbers. Be able to account for unplanned and unintended purchases. Continue to come back to the budget and review it regularly so that you can make changes as needed and treat It as a living document. And do not give up at the first sign of trouble with your budget. Then you too will be able to budget and erase debt forever.

Small Business Budgeting - Major Mistakes to Avoid Business Suicide!

Small business budgeting is crucial, especially in this slow economy. Because budgeting affects both the income and expenses of a company, it is necessary for the survival of today's small business. The obvious and biggest mistake made is not to have a budget at all-this is business suicide! Having said that, it's never too late to start a budget of your own while keeping in mind these major mistakes to avoid:

Be realistic when establishing your budget. Start with your best estimate of your sales revenue target and expenses, both fixed and variable. Variable expenses, such as travel, promotional or staff events can change from month to month but should be estimated as closely as possible. Small business budgeting should also include the cost of goods sold, if applicable. Don't forget to leave some wiggle room for the unexpected repair or replacement based on your business experience.

Be sure to set up a simple system for budgeting. Use the KISS (Keep It Simple, Stupid) philosophy and keep it as easy to use as possible so that you aren't discouraged from staying on top of it. The more complex the system, the less likely you are to be consistent with it. Small business budgeting is crucial, and requires consistency and accountability. Chances are you will be consistent if it's something you can do in a couple of hours per month, as opposed to a couple of days per month!

Don't "set and forget" your budget. Budgets need to be monitored frequently in order to remain effective. Income and expenses you estimated last quarter may be updated with more accurate numbers. Maybe you can eliminate some advertising costs if a particular campaign is not bringing you the desired results. Your budget is not set in stone...don't be afraid to make adjustments as necessary, keeping in mind what your business goals are.

Make marketing expenses a priority in your budget. Marketing often determines the success or failure of your business and should not be given the "scraps" at the end of the budget, or taken from the gross profits. Marketing expenses should be established and built into the budget as it is a vital part of increasing sales. Small business budgeting means getting the most bang for your buck these days when it comes to marketing so examine those expenses carefully and budget for them accordingly.

As you continue your small business budgeting, you will come to appreciate its importance. As a small business owner, it is very likely that you wear many hats so you can see the value in knowing and following your budget while making day-to-day decisions for your business, right?

Why You Need to Create a Personal Budget?

Do you know where all your money goes? Do you wonder why as soon as you get paid the money just seems to disappear leaving you broke until the next pay check? And what about saving for retirement, or do you plan on working for the rest of your life? Successful businesses and people have a budget and so should you. If you don't you need to create a personal budget today. Think about it, a business has to carefully track income and expenses in order to successfully turn a profit. If businesses ran their budgets the same way most Americans keep their personal budgets most of them would fail.

And that's precisely the point; the vast majority of people in the United States are failing financially. If you are one of them and you want to do something about it you need to create a personal budget. By not controlling your money you lose the opportunity make your money work for you. Those who have built personal wealth have done so by telling their money what to do, not because they have high paying jobs or inherited it. And they do this by creating a budget, or cash flow plan, that tracks every dollar that comes in and every dollar that goes out.

The first step to financial wellness and then freedom is taking responsibility for your personal finances. This means that the buck starts and stops with you. There is no one to blame for the monetary situation you are in except you and once you take that responsibility and decide to do something about it the only thing that can stop you from reaching your goal is you!

A budget can be a scary thing for most people because most of the time it shows them spending habits that are rather embarrassing. Once they list out their income in one column and their expenses in another column the truth comes out and it isn't always pretty.

Once you have decided to take back control of your money and make it work for you the first thing to do is get out a piece of paper and a pencil and start making a budget. Before you can begin to set financial goals you need to know how much monthly income you have and how much your monthly expenses are. Write it all down in two columns; one for income and one for expenses and leave nothing out. You have to be honest with your finances or your budget will not be worth the paper it is written on.

Once everything is written down and added up take some time to look it over carefully. Your first budget may not be perfect but it will give you a good idea where you stand financially. It will also give a good starting point to start the process of telling your money what to do. There will be expenses that seem outrageous once you can see them and this is the time to decide where and what needs to be cut or eliminated so that you can reach your financial goals. Chances are that up until this point the money just came and went as if on a whim. Building wealth is not something that happens on a whim, it takes patience, the ability to make sacrifices, and a plan. The personal budget you create is the plan, use it wisely.

Simple Budgeting Tips - What Are Some of the Items Found in a Typical Household Budget?

If you're new to budgeting, you're probably wondering where to start. That's easy, you should start by looking at your typical monthly expenses and create a master list of every expense. Budgeting can be overwhelming, but if you take simple steps and start with a list of your expenses, you're much more likely to have a more comprehensive and accurate budget model. Here are the top categories that you must include in any household budget, starting with the largest costs.

Housing Expenses

This list is by far the biggest part of most people's budget. Housing expenses include your monthly mortgage or rent, as well as the utility expenses such as gas, electric, water and sewer. Other related costs of housing include any homeowners or renters insurance, property taxes and private mortgage insurance. Monthly or annual homeowners association fees are also part of your housing expense, as well as any maintenance on your home or home improvements. Make a list of all your expenses related to where you live and that should complete the budget items for this category.

Transportation Expenses

Transportation is typically the second largest budget expense for most people's household budget. Transportation costs include any type of travel related to everyday life. For example, any car payments, drivers license fees, registration fees, bus passes or taxi rides would be part of your transportation expenses. Other budget items include any car insurance or parking fees. Plane trips are included here if they are part of your everyday life, but would fall into vacation or entertainment if they are for pleasure. And don't forget to add the cost of your car's maintenance, oil changes, and of course, gas.

Food

Food is the next largest part of most household budgets. When preparing your budget, you'll want to include any costs related to the food that you eat on a daily basis. This includes any grocery store trips and wholesale club visits, however, you'll want to remove any non-food expenses from these bills. Other food budget items include dining out, coffee, snacks and the cost of any vegetable or fruit garden.

Entertainment

Entertainment can mean a lot of different things. Basically, anything that you do for pleasure that is not a required expenditure. Big ticket items in this category include such costs as boats, campers, snowmobiles and ATVs, as well as the costs that go along with them such as insurance, gas, maintenance, and any trailer costs. The day to day entertainment expenses that you'll want to add to your budget include such things as movie theaters, dinner theaters, social events, parties at home or away, going out with your friends, trips to museums or sporting events, and anything else that you do for pleasure that isn't a vacation. Other expenses that fit this category include your TV, satellite, cable, Netflix, or Hulu subscriptions, as well as any video game costs.

Vacation

Although it can be considered an entertainment expense, vacations should be broken out separately in a household budget. Vacation expenses include the travel, lodging, dining and entertainment expenses while you are on vacation. Make sure you include all of the little expenses like gas, taxis, souvenirs, airport shuttles, and tips at hotels and restaurants.

Communication

Communication expenses also make up a substantial portion of your monthly budget. These include costs for Internet access, your home phone, and any cell phone and cell phone data charges. Also, make sure you add in the cost of your phones and even computers if you use them primarily for communicating with sites like Facebook or skype.

Holiday and Gifts

While collecting the items for your budget, don't forget to include a monthly allowance for holiday and gift costs. Holidays include all of the extra food and entertainment expenses, as well as decorations, costumes and sweets. Gift costs include all the gifts you buy each year, for holidays, birthdays, and for all the parties you may attend.

Miscellaneous

Everything not covered above can be lumped into miscellaneous expenses. Once you've collected these expenses, you can break them into any budget categories that you want to include in your budget.

These are all of the typical expenses found in a budget. Notice that income is not included, but will be when you create your budget. And now that you know what type of items are found in a typical household budget, you can start collecting and tracking your expenses to get ready to create your own personal budget.

Homogeneous Competition in China's Budget Hotel Industry

China's budget hotel industry, which has less than 10 years' history, has again come under the limelight. On one hand, it is the domestic giant Home Inn on an acquisition spree; on the other hand it is the rapid expansion of international predators. In less then 4 years, the number of budget hotels in China had grown from 166 in 2004 to 1476 in October 2007, almost a 1000% growth. As the industry becomes more mature, many problems previously swept under the carpet are now surfacing.

Cost challenge

Compared to ordinary hotels, cheap rent is the major feature of budget hotels, as well as the main reason for the industry's fast expansion. But as the number of budget hotel surges in China, budget has become the biggest issue faced by budget hotels currently.

"Cost increase is a dire problem for budget hotels. Apart from general cost inflation, costs associated with expansion activities have been the chief reason for cost increases in most budget hotel chains." said Mr Hu Shengyang, CEO of Shanghai Inntie Hotel Management Consulting. Hu suggested that the concentration of location selection by budget hotels and their exponential growth in numbers have resulted in a reduction of potential sites. This intensifies the competition for high grade properties between hotel brands, directly pushing up site acquisition costs. Meanwhile, other costs such as personnel, building and management are also going up.

"The situation of cost increase can help the budget hotel industry become more rational." said Mr Cheng Jun, vice-CEO of Hanting Hotel Management Group. Compared to a payback period of 1-2 years in the past, Cheng thought that the current payback period of 3-5 years for budget hotels is more reasonable in a normal market.

Mr Hu also agreed that cost increase should make the whole industry more concentrated. While some small chains may have to exit due to cost pressure, large budget hotel brands could accelerate their strategic progress, in order to secure a first-mover position in the future.

The withdrawal of Top Star Hotel, now acquired by Home Inn, has proved the point. Industry insiders commented that in order to quickly list the company on stock exchange, Top Star were furiously expanding its hotel numbers, at an unsustainable cost of 15% higher than the industry average. The failure of Top Star should give the Chinese budget hotel industry a warning signal.

Homogeneous competition

Not only costs are increasing, budget hotels in China are also facing the problem of "decreasing income". According to a survey report in 2007, the average price per room had decreased from 328 yuan/day in 2005 to 208 yuan/day in 2006, and occupancy rate also down from 89% to 82.4%.

"On one hand it is the increase in hotel numbers, on the other hand these hotels share the same market positioning, hence the inevitable price war between budget hotels." said Mr Hu. He explained that the early type of budget hotels in China was simply a copy of the budget hotel models from Western countries. Once a pilot hotel was proved successful, the same model would be duplicated in other cities by the company. Other new comes would also the proven model, therefore resulting in the problem of homogeneous competition across the budget hotel industry. When the industry was at an early stage, this homogeneity problem could be covered by the strong market demand. But as the industry saturates, consumers can now have more choice. Hotel operators thus have to reduce their prices to attract customers.

But Mr Cheng disagreed, saying that the key reason for homogeneity is rather due to unsophistication of the industry. He pointed out that budget hotels are also called "limited service hotels". In developed countries, based on differentiated demand from different target groups, the meaning of "limited services" can be very different. Many multinational hotel chains have thousands of hotels, which would be classified into 8-12 grades according to different customer demands, such as tourism and business travel.

"As the market matures, hotel chains will inevitably become homogeneous." said Mr Cui Tao, an integrated marketing expert. "The competition between budget hotels in the future will no longer be on a shop-to-shop basis, but on a collective basis. In this rivalry process, all aspects of a business, such as branding, culture, business model and cost control, would need to be combined together to achieve a core competitiveness that cannot be replicated easily."

Management difficulty

"There will be only two types of hotels that can survive in China: individualized hotels and systemic hotel chains." Mr Cheng forecast. He reckoned that individualized hotels can survive on their uncopyable, unique features, while the advantage of hotel chains will be their scale and uniform quality.

However, Mr Cui thought that the there is a contradictory relationship between quality control and scale, "Larger scale may mean increasing brand risk, but the formation of a brand requires scale." In this sense, the standardisation of budget hotels is not only an issue of individual breakthrough, but a process of structural superiority. "From managing a few hotels to managing scores of hotels, the methods for standardised management would be quite different." said Mr Cui, who has a profound background in franchise business management.

Hanting Hotel Group, a relatively new comer to the industry, is showing more caution. It is understood that apart from improving the management of standardised systems, Hanting is also strictly controlling the number of franchisees. At present, only 10% of Hanting's hotel chain are franchised hotels. Mr Cheng admitted that "franchised hotels are more difficult to communicate when it comes to standardised management. Therefore before our management capability can be substantially improved, it would be safer to control the number of franchisees."

For more information on Chinese businesses, please visit www.chinabizintel.com

Get The Best Out Of Budget Software

The use of a budget software program that is complete is no doubt way much better instead of having to use an Excel budget template. A really tricky part in budget management does not happen in costs outlining but actually lies in the day to day management of your lifestyle based with the budget that you have. At this point, budget software program is worthy to be used.

Are you now neck-deep with your debts and is currently thinking of getting the help of budget software to be your financial organizer? In case that you are indeed in this kind of predicament, do not feel like you are the only one experiencing this. There are millions of other persons like you who have debts in banks and companies of credit cards. And to make things worse, there are plenty who lost jobs due to the present global recession that has hit the economy of many countries.

Good thing that there is budget software that can help users in tracking their expenditure side by side by their income. This gives users useful information regarding the services and items that needed to be bought. This will let users know if they are already spending way high above their set budget. This kind of budget software will help users in easy organization of their finances, something which cannot be made possible by the Excel budget template download that many people opt to have these days.

Income and Expenditure Tracking

In order for to budget properly, you must first know the amount of money that is coming in and what specific areas require you to spend some of it. Budget software built with an application from Microsoft Excel will easily render this kind of information without any hindrances.

Planning of Finances

After you have tracked your income and expenditures, you will now be more prepared when you plan your finances. You will now be able to see clearly the amount of money that you can use for your expenses. This is one good way of ensuring that you will not go beyond your set budget and that no further debts will be incurred.

Avoid Increase in Debts

Debts can cripple and even the small ones can be like ropes around your neck until you have paid it all off. Majority of the debts that people incurred these days are far from what they can afford, which resulted to more financial burdens. With budget creation and sticking to the constraints that it has, debts will be avoided from increasing in amount.

Detailed Budgeting Made Possible

By allotting some of your time for financial organization, you can surely plan properly for payments as well as emergencies that typically happen in a single year which you must not fail to consider. Birthdays, holidays, renewals of insurance and a lot more occasions can take place and must not be overlooked. Being able to detail your budget for any upcoming expenditures will give you a good position in order to avoid debt incurring. Excel budget template is something that cannot offer this.

No one would like their finances to go out of hand, the main reason why it is a must to determine how much money you still have and how much you will be willing to spend. Knowledge of such things will avoid the piling up of debts and will also allow you to save money for future expenditures. Being a good financial organizer, one must not fail to make use of the Excel budget template offered by budget software.

The 5 Most Common Mistakes for New Budgeters

Budgeting, when done right, is the most awesome tool for erasing debt and building wealth. But many people do it wrong and then quickly fall out of practice. Here are The 5 Most Common Mistakes for New Budgeters.

1. "Forgetting" To Include Everything

One of the biggest mistakes first time budgeters make is to not include every single instance of money coming in or money going out on their budget. In fact the expense side, or money going out, will usually contain the most mistakes. When you are not use-to tracking all of your expenses and budgeting for them, it is easy to overlook them when it comes time to write them down.

And many times your mind tries to play tricks and pretend a bill doesn't exist. Denial. Your brain tricks you into thinking that if you don't acknowledge a debt then it does not exist. Trust me, it is still there.

This will become easier as time passes and you have been budgeting for several months. Soon you will get to know each of your bills by heart. But in the beginning it is easy to over-look something. And easy to forget something if your mind is playing games with you. Do not leave anything off your budget. Include it all.

2. Over-Complicating It

The next biggest mistake is that people either purposely or not try to over-complicate the budget. There are 200 categories, and each category has its own subcategories, and those sub-categories refer to other budgets. Or your categories do not even apply to your lifestyle. If your kids are older there is no need to have a category for day-care on the budget.

Make sure your budget is clean and free of any extraneous categories. Your budget should be customized to you and not the person before you who gave you the budget form.

3. Not Changing With the Times

Another mistake made is people do not modify their budget over time. No two monthly budgets will ever be the same. So don't try to force a one-size fits all mentality into your budget. Your December budget will be very different from your June budget. Make sure you take that into account.

Sit down and rework your budget each and every month to customize it to that month's budgetary needs. This doesn't have to take a long time. You should be able to do this in 10 to 15 minutes once you have been budgeting for several months.

4. Using Tools You Are Not Familiar With

Another pitfall of new budgets is made when folks try to use tools they are not familiar with when creating their budget. If you are technically challenged then do not buy a $100 budgeting program for your computer that you will never fully understand. All it will do is create frustration and lead to you not using your budget.

And if you are not good with Excel, don't try to force your budget into a spreadsheet program. Again all you will end up doing is causing yourself grief and giving up before you have really had a chance to do it right.

There is nothing wrong with the old-fashioned pen and paper when creating a budget. Sit down, and write it down. It is simple and doesn't require you to understand 3 programming languages to add up 1 + 1.

5. Not Sticking With It

Finally, the last mistake folks make is not sticking with it. Or just not continuing with their budgets. If you don't use a budget, you will not get out of debt. And if you just stop, it gets harder and harder to get back on track. You need to be able to train yourself to take a few minutes per week or per month to review your budget, edit it, and follow it. A budget will do you no good if it is just sitting in some junk drawer in your kitchen.

So avoid these 5 big budgeting mistakes and continue to erase debt and build wealth.

Home Budgeting Software - Isn't It Time You Took Charge Of Your Finances?

Very few people these days take the time to create a budget. As more and more people worldwide alarmingly are getting themselves into debt, it appears that people do not want to change their spending habits. So many spend more than they earn without even realising it, which is why creating a home budget is very important.

So ask yourself, do you want to get out of debt, start saving money, stop living from pay cheque to pay cheque and rid yourself of money related stress? If the answers are yes, then read on!

Home budgeting definition - Home budgeting helps you live within your means. By clearly tracking your expenses over a period of time, you can organise your finances and adjust your spending accordingly. A budget calculator will work out your spending habits from the following:

  • Your income - the amount you take home each week/month
  • Household expenses - rent, mortgage, utility bills, etc.
  • Regular expenses - food, petrol, etc.
  • Savings and investments - including pensions
  • Liabilities - loans, credit cards, etc.
  • The difference - Total income minus total expenditure. If the expenditure exceeds the income, then measures need to be taken to adjust your spending

What will a budget planner do for me? - With a budget planner, you can set limits on your spending for each category of expenditure and it will show you where your money is being spent. It will also show you your spending limitations to ensure you don't spend beyond your means. It is difficult to stick within a budget, but the long term benefits are fantastic. Strive towards a debt-free lifestyle and take control of your money before it takes control of you!

Choosing the right home budgeting software - If you are new to creating a budget on a computer, choose software that is easy to install and use. Make sure it has the features you require to create your budget with automatic categories and the options to add more. Some home budgeting software will have features allowing you to connect to your bank accounts, PayPal, etc. and will have everything else you need to create a budget with detailed reports so you can clearly see your income and expenditure information. Check to see if the manufacture offers free upgrades on the software so you can keep up to date with any new features. Security is very important, so check that the software has the relevant tools to protect your privacy.

Where can I buy home budgeting software? - Home budgeting software can be purchased online either as a download, or on a disk. There are many free downloadable options too, but it is worth considering the possible pitfalls with these, as there could be security issues, plus these do not offer as many features. It is well worth paying for home budgeting software that will suit your exact financial needs, so select software that you can afford and will make your budgeting easy and accurate to help you take control of your finances.

Why Your Budget Didn't Work

If budgets don't work for you, we need to talk! There was a time when I thought budgets didn't work for me. I always had something come up that couldn't be predicted. How's a budget going to deal with surprises? I can give you one example after another when a budget didn't work in my life. Then I learned something new. Budgets aren't supposed to control your spending and keep you out of trouble. The only thing controlling your spending is you, but your budget can help you see what you are doing.

Now you want to ask, "If a budget doesn't control your spending, what good is it?" Well, let's look at a budget as something slightly different from what you expect it to be. Let's ask, "If you knew exactly where you spent your money during the last twelve months, and you had a chance to do it all over again, where would you spend your money this time?" In a lot of ways, that is what a budget really is - a better plan for spending money than you had before now.

That explains the first reason why your budget didn't work: You expected it to do something it can't do - control your spending.

The second reason your budget didn't work for you could have been that you expected it to tell you how much you were going to spend on each category of your spending. But when you planned the budget you didn't have a crystal ball to predict the future.

If you plan a budget to guide you as you spend money going forward, don't build it from examples you find on the internet telling you what percent of your take-home pay to spend on each category. Instead, make sure it is based on how you spent money in the past and changes you want to make in the future. You also want to ask yourself some basic questions. Like, "what do you want your money to do during the next twelve months?" If you say you want to have money to pay for a vacation, you need to agree not to spend all your money dining out and buying clothes. Of course there are plenty of things you must spend money for, like groceries, housing, basic utilities, and transportation. But, if you want to do more than pay the basic bills, identify what you want to accomplish with your money and set some goals. When you are about to spend money, ask yourself if this is what you really want to do with your money. And remember your goals.

The third reason your budget didn't work is that you didn't give it any "wiggle room." You used all your money in the plan for your budget and there was no money left for emergencies. Even if you had an emergency fund, you need to have extra money available to re-stock that fund when you need to use it. There's always another emergency waiting just around the corner.

The fourth reason your budget didn't work could be the failure to control individual spending. It's real easy to give yourself permission to buy the latest techno-toy. Or, for someone else in your family to dip their hand in the cookie jar (household cash) to pay for a trip to the ice cream shop. To control this uncontrolled spending, I think it is a good idea to give each person in your family a spending allowance. This is especially true for you, if you are the one planning the budget.

Your spending allowance should include the money you want to spend on clothing, entertainment, gas for your car, dining out, and things you want to buy to make yourself happy. When you give yourself an allowance, you put a spending cap on your every-day spending. If you want to spend more of your allowance on clothing, you have to cut back on something else. If you budget individual spending as an "allowance," your overall household budget doesn't have to keep track of exactly how much you spend on dining out, or clothing. Those details will be controlled by the individual who manages their own spending. This lets everyone in your family learn how to budget.

Everyone in your household should have a spending allowance (suitable for their needs). Young children can't plan too far ahead and will need some help to avoid spending all their money on the first trip to the mall. The important part about your budget is that everyone has their personal spending limited by the spending allowance which they receive every week, two-weeks, or monthly. When they have spent their money, they need to wait until the next allowance will be given out before they have money again. And, using the allowance plan, credit cards need to be treated as a convenience rather than as a loan. When the statement comes, it must be paid off - totally!

You might also consider using the concept of a spending allowance for household items, or to pay expenses for a vacation home. In an accounting system, these would be individual accounts or categories for tracking money. These accounts work just like the personal spending allowance... How much allowance do you want to give your house to spend for yard care, landscaping, and maintenance? If you spend too much on the mowing service, you have to cut back on something else the "house" is spending money on. The idea is to avoid spending more than you "allowed" for the house.

If you set up your budget like I have explained and you also have an allowance for building savings for future needs like children's education, or your own retirement, and you have your emergency fund big enough to handle the type of surprises that happen in your life... (That's a big IF!)... you can expect your budget to work better than it has been.

Simple Budgeting: The First Steps

Creating a budget and taking a deep look at your finances is a big step. Setting up a budget can give you control of your finances and relief from nagging debt and bills. A simple budget can save your personal finance life. And, it's not nearly as hard as you may have thought it was. Setting a budget up for the first time can take some time, but once you have, the maintenance is quick and easy. So, how do you go about setting up a budget? Here's some steps.

First things first. You can't budget for your money, if you don't know how much money you have. Start off by calculating your income from all of the sources that you receive money from. Include salary, child support, alimony, social security, interest, dividends, and any other miscellaneous income. If you're creating a budget for your whole family, also include the income of your spouse and any other contributing members of your family. An important point: Don't include income that is highly changing. A yearly bonus, any tips, and even some commission pay can change drastically. Start with only the income that you can reasonably depend on.

Once you've determined your income, it's time to move on to the most important part of the budget. The expenses. You can break them down however you like, but for ease, put the items that are non-negotiable at the top. Things like mortgage or rent, loan payments, and utilities. Follow those with the things that are necessary. Food, clothing (necessary clothing, not trendsetting), and medicines. Finally, add anything that you want to buy or spend on, but that isn't necessary. Anything you can live without. Subscriptions to magazines, golf club memberships, gym memberships, and your morning coffee. If you don't know exactly what all of these things are, keep a ledger for the first few months and your spending habits will be quickly revealed.

With the full list of income and expenses down, it's time to put it all together. Essentially, all a budget does is compare your income to your expenses. If you're expenses are more than your income, you need to reduce the amount of money that your spending and budgeting for. If you're expenses are less than your income, you've done well and have a surplus to use to pay down debt or to save for a rainy day.

With those steps, you'll be able to easily create a simple budget. Once you've got the basics down, it's time to make the budget really work for you. Use your budget to reduce your expenses to below your income so that you have extra money available to budget for debt repayment. The quicker you pay off debt, the faster you'll be free to buy what you want, or quit your job and go to work doing something you love. You'll also want to use your budget to create a savings account or two that can be used in an emergency and also for a retirement fund.

As you can see, creating a simple budget isn't that hard. It can easily be created with a few hours work, and the maintenance to keep it updated and to make it work for you is far less. Creating a budget is the first step on the path to financial independence, and once you've created it, you can begin enjoying the freedom and peace of mind that comes from having your personal finances under control.

The Benefits of Creating a Budget You Can Stick To

Planning a budget is one of the simplest and most effective ways of managing your money. However, most individuals avoid actually taking the time to do it because it take time and a little bit of effort. Many also believe that budgeting their money will prevent them from being able to do the fun activities they enjoy.

In reality, budgeting doesn't keep you from enjoying the activities you love. Rather, it shows you where to put your money and how to spend it so you can still do what you love and live within your financial means. It keeps you from spending too much money and ending up in debt.

If you are considering starting a budget using online home budget software, you can take advantage of the many benefits budgeting provides. Some of the best benefits are listed below.

The Advantages of Budgeting

  • Gain Control Over Your Money- When you create a budget, you are being intentional about the what you spend and what you save. This allows you to control you money, instead of your money taking control over your life. It help you avoid the stress of discovering you don't have the funds to pay certain bills and helps you determine what you need to sacrifice in the short term to gain what you want in the long term.

  • Helps you See Where Your Money is Being Spent- My husband has a phrase he uses all too often in our house: "It's only a dollar." When you think of your spending habits this way, it can sometimes seem like you really aren't spending all that much. In reality, though, even those items that seem inexpensive now can add up quickly and take over your life. Home budget software allows you to see exactly how much you are spending and determine what it is costing you each month.

  • Saving for the Unexpected- Budgeting allows you to create a plan for you money. This means you can actively plan to set aside a certain amount of cash each paycheque for unexpected costs and emergencies. Then, when the unexpected occurs, you don't have to break your budget; the money is already there.

  • Allows You to Communicate Personal Financial Management With Others- If you share your household with a spouse, a roommate, or your family, a budget will allow you to communicate your financial needs and financial planning with these individuals. You can determine how your money can be used together, teach responsibility to your children, and avoid conflicts about money with your spouse.

  • Alerts You To Potential Problems- While we like to think that budgeting keeps problems from occurring, this is not always the case. If you can't stick to the budget or a new expense occurs that doesn't fit within it, your old budget may be more of a problem than a solution. If you have a budget set up, though, you can see how new expenses affect your current available cash flow and can do something about it before it is too late.

There are many benefits to creating a budget using home budget software. Take advantage of them today and begin taking control of your financial situation.

5 Reasons Budgeting Can Improve Your Life

It is often asked why you should budget. It is so boring. I don't have time to budget. Lots of excuses. But the truth is budgeting is very helpful and beneficial to you and your family. Here are 5 Reasons Budgeting Can Improve Your Life.

1. Reduce / Eliminate Debt

The number one reason given for making a budget is to reduce your overall debt and to eventually eliminate debt from your financial life totally. Budgeting is a tool by which you take back control of your cash flow. You remove the majority of the spontaneous spending and you plan ahead of time on how your money will be spent. It eliminates the feeling of no control and returns those controls back to you.

2. Build Savings

Budgeting is not just for being rid of debt. Once you have paid off all of your debt you should continue to budget. Where before you were directing your money were to go to get out from under that debt burden, now you can direct your money where to go for savings and investment purposes.

Once you get to this stage of budgeting, budgeting actually becomes fun. Because now instead of watching your money being used up on paying off things you purchased in the past, you can now watch your money grow and build up for purchases that you will need to make in the future. Budget 10 to 20 percent of your take-home pay to go to savings. It could be an IRA (Individual Retirement Account), it could be a Certificate of Deposit (CD), or a Money Market Account (MMA).

Or just save it in the bank and watch it pile up there. All the "savvy" people out there are now yelling, "but you get terrible interest rates with a savings account." And that is true, the amount of interest you can earn on a savings account is significantly less than other money vehicles. But, how many people can actually say they have $5000, $10,000, or more sitting in a bank doing nothing? Not many. And it would be a good bet that those same people yelling about lousy interest rates in bank accounts don't have $5000 or more in any other high-yield account either. Except for a company 401k plan if they are participating. $5000 in a savings account is worth more than $5000 on a credit card bill.

3. Reduce Stress

This leads to the ultimate reason to budget which is to reduce stress. Hopefully the example of the savings account above demonstrates that. Your level of stress over finances would be greatly reduced if you had $5000 in the bank. Or $10,000 or more. Admit it, when you read $10,000 in a savings account above, you were thinking you wished you had even a tenth of that saved. Surely you can picture, even feel, what sense of power and relief it would be to have that money just sitting in a bank account somewhere, on the off-chance you needed it.

4. Retirement

Budgeting allows you to direct where your money goes. The ultimate goal is to get to a point where your money is working for you so that you can work less for money. This is called retirement. Budgeting can get you to the point where you have saved enough money to not have to worry about money. Then you can retire, if you want. Or you can continue to work if you choose. Part-time even. But if you never budget you are leaving your money to be directed and grabbed up by others. And when it comes time that you want to retire, you may find you don't have the option to quit.

Which would you prefer to be:

a) a 65-year old person who continues to work because you choose to? You have the option to say no more.

b) or a 65-year old who has saved nothing and has loads of debt and HAS TO continue to work.

5. Generational Impact

One last benefit of budgeting that many don't realize is that by budgeting and being good stewards of your money, you teach your children by example how to handle money. And in turn they will teach their kids. You can actually make an impact on multiple generations just by budgeting and handling your money properly. It won't require you to buy a huge estate, farm, or company to do so. Your impact will be felt by how you behaved and not by what you bought. That is a true legacy.

So get going budgeting, erase debt, and build wealth!

How to Budget Fast and Easy: The 5 Steps to Success

Some of the most frequently asked personal finance questions during this difficult economy revolve around "how to budget", "how to make a budget" and "how to live on a tight budget". Budgeting your money successfully is crucial to flourishing in any type of economy, much less a tough one. There is a common misconception that good budgeting depends upon fancy forms, financial expertise, software programs and solely on one's income. All of these false notions completely circumvent the only true goal of any personal budget: Getting the most value for each of your hard-earned dollars.

Those misguided beliefs above are the key reasons why many people are much worse off than they should be, regardless of income levels or familiarity with financial software. There are many people who are much "better off" with a lower income and a simple budget form than those with great salaries and top-notch computer programs. These successful folks are the ones who have learned the secret: Keenly stretch your dollars without sacrificing quality or "good living". This is the foundation for our budgeting method and it is the best method. It is the most effective method because it combines the three critical budgeting elements: Cost-cutting without sacrifice, timing your income/expenses and simple, accurate recordkeeping.

We have been successfully managing a household budget for nearly 30 years and have survived many unforeseen "bumps and bruises" along the way. During that time, we paid off our mortgage eight years early, sent two children through college, managed to save a good deal of money and maintained a nice standard of living. There were no magic tricks involved, just common sense, a few simple forms that we developed (see below) and a little effort. We have read countless "How to Budget" books and articles over the years and while a select few were beneficial, the majority we simply dismissed out of hand.

Unfortunately, most budget or personal finance "experts" approach cost-cutting from the standpoint of scaling back on items and niceties as a first choice, as opposed to a last resort, as it should be. One author for a popular financial web site even suggested eating a sandwich or a snack before going out to dinner because you would be less hungry and therefore saving some dollars. Taking this "logic" just a step further, why not just stay home and save even more? It is this type of lazy journalism and advice that keeps people meandering on the path to mediocrity. We had a good chuckle and moved on.

There is a Better Way...

The Dining Out Example:

The basic idea behind going out to dinner is to escape your stresses for a bit, have fun, relax, enjoy a change of scenery and forget about cooking and doing dishes for the evening. If you are going into it overly concerned about the financial aspect, you are nullifying the underlying relaxation intent. Our approach for "cutting back" on dining out expenses is quite the opposite: Cut only the bill, not the quality or quantity of dinner items. How so? By using Restaurant.com, anyone can cut their dining bill by 60% every day and up to 92% on special days. That is paying 8 cents on the dollar. This is a much more effective approach and no one needs to worry about filling up on pretzels on the way to the restaurant.

While well-intentioned, it is this narrow, defeatist assertion of the author and many like-minded peers that we reject. Cutting back on products, services and enjoyment to save money is not getting ahead, it is trading off. And trading off is not the path to living better. We fully support frugality, with the added feature that you can be frugal AND attain a higher quality of living simultaneously. Certainly you shouldn't waste money on items which return little value but nor should you unnecessarily deprive yourself of the fruits of your labor. Break free from the antiquated "You can't have your cake and eat it too" crowd. A cake has only one purpose and the trick is to find the cheapest high-quality "baker".

It is this simple dining out example upon which our entire budgeting principle is based: Why spend more for something when you don't have to? We take it to an extreme however and raise the question to: Why spend MUCH more for something when you don't have to?

Much like visiting the local market and discovering that Joe is selling a bag of apples for 10 dollars while John is selling the same bag for 3 dollars, the choice is simple. This "supplier-replacement cost-cutting technique" is the backbone of our budget plan. Accordingly, we highlight similarly discounted deals in many areas of consumer spending. That is our philosophy and this is reflected throughout our site and specifically in our Budget Cutters section. The prices are 50%-90% off of retail on many purchases, bills and expenses that people deal with every day. Furthermore, in many cases, the "3 dollar apples" are of higher quality than those in the 10 dollar bag. This is the "secret" to getting ahead.

Our mindset and methodology on how to budget are clear:

1) Slash costs.
2) Maintain quality.
3) Pocket the difference.

The old adage is true: "A penny saved is a penny earned". The real goal though is to multiply the benefits of that adage over the course of time into "Thousands of dollars saved are thousands of dollars earned", while increasing your standard of living and net worth.

How to Budget: Step by Step Instructions:

Note: All of the forms referenced are freely available on our web site, along with sample completed forms.

Step 1: Find a quiet spot, relax, clear your mind and rid yourself of all of the over-complicated, force-fed convoluted advice that you have received over the years. Successful personal budgeting is easy and enjoyable, particularly the end result.

Gather all of your current information regarding income, debts, recurring expenses and discretionary (fun, entertainment) spending. This can be handwritten on a piece of scrap paper or with a collection of paystubs, bills, bank and credit card statements. To keep matters simple, use your after tax (net) income for purposes of using our forms. If you have savings, insurance or other expenses deducted from your paycheck, add those amounts back in to figure your net income. This will be your true net income, those "deducted" expenses will be listed in another area of your worksheet. Enter all of your data in the appropriate area of the Budget column on your Budget Form. This is a simple 3 column form with the headings: "Actual", "Budget" and "Variance". Do not be disheartened or discouraged if the results appear pessimistic at this point. Your only goal at this stage is to be certain that you have all of your items listed.

Note: Steps 2 and 3 are performed only when using our budget plan for the first time. Thereafter, it is simply a 3-step process.

Step 2: This is the most critical and the most overlooked step by many people. It is the step which differentiates our plan from the majority of others which emphasize cutting your quality of life to save a buck. Remember the theme: "Cut only your costs, not your enjoyment". This crucial area requires some upfront effort and will be well worth the time. Our Budget Cutters section will be an enormous help. In this step you will permanently cut the "fat" (overpaying) and this is the foundation upon which all of your future budgeting success depends. As you discover big savings on the payouts that you have already been making, this money will fall to the "bottom line", your pocket...where it belongs. Take your time and review the deals that we have listed, as well as any deals that you may find on your own.

When you have good estimates for your cost-reduced budget figures, enter these figures in the New Budget column on the Comparison Shop Form. This is a simple 3 column form with the headings: "New Budget", "Original Budget" and "Variance". Enter the information from Step 1 in the Original Budget column and figure the variances. This will illustrate your newfound savings by category.

Note: This step may take some time before you have whittled down every one of your expense categories. Do not fret, use your best estimate at this point and adjust your figures as you move through later months. If you are in a dire hurry to get your budget done immediately, skip Steps 2 and 3 for now and revisit them later. Bear in mind the importance however, as this is the step which puts money back into your pocket.

Step 3: Adjust your budget and re-apply your newfound savings to some of your critical categories: Debt (particularly credit card debt), savings accounts and "fun" spending. These figures are entered in the New Budget column of the Budget Readjustment Form. This is a simple 3 column form with the headings: "New Budget", "Original Budget" and "Variance". Example: If you have been making only the minimum payments on your credit cards, increase these payments immediately for the sake of your long term financial health. Credit card interest is a killer and the longer these debts exist, the more damage it will do to your cash flow. Equally as important, comparison shop your current cards for better deals concerning interest rates and cash-back options. Enter your changes in the New Budget column. The goal here is to maintain virtually the same bottom line after you have readjusted your categories. These are now your official budget figures.

Step 4: At the conclusion of the first month, enter your actual spending in the Actual column of the Actual vs Budget Form and your newly budgeted figures in the Budget column of the form and figure your variances. This form is identical to the one in Step 1. This is your report of how well you performed for the month. Use this first month as your stepping stone for the future, with steady progress as your goal.

Step 5: This is the step that ties it all together: The Weekly Budget Form. This is a simple 3 column form with the headings: "Actual", "Budget" and "Variance", broken down by week. This form will be an immeasurable help in planning the timing of your bills and income. This form is completed much in the same manner as the others but is organized by week and due dates to ensure that your budgeting process will flow without any shortfalls in funds. Before the month begins, fill in all of your Budget data (according to your due dates) in the Budget column of the Weekly Budget Form.

The key here is to make certain that the figure labeled Gain or (Loss) for the month (at the bottom of the form) in the budget matches the figure labeled Balance in the budget column of your monthly Budget Form. It is imperative that these two figures are in sync before the month begins. At the completion of each week, fill in your actual data in the Actual column. When the month is complete, the actual and budget figures on the last line of the Weekly Budget Form should match the actual and budget figures on the last line of the Monthly Budget vs Actual Form. You will now have completed reports on a weekly and monthly basis for the month just ended.

Source: BetterWaysToday.com.

© 2011 BetterWaysToday.com. All rights reserved.

Budget and Financial Management

There are three main phases to the local government budget process:

1. Budget Preparation - Budgetary guidelines are established based on the annual plan and goals

2. Budget Adoption: Budgets are adopted by the government

3. Budget Execution: Implementation of the budget consistent with nationally established accounting procedures and policy with oversight mechanisms to ensure funds are properly spent.

Guidelines established by the Government Finance Officers Association's (GFOA) steer the local government budget process. These guidelines include:

1. Establish Broad Goals to Guide Government Decision Making - Strategic Planning Process

2. Develop Approaches to Achieve Goals- Objectives and Activities to Achieve

3. Develop a Budget Consistent with Approaches to Achieve Goals

4. Evaluate Performance and Make Adjustments

There is no question that these guidelines create a sound finance and budget process. But, as is evidenced by the current financial state of most local governments, additional standards are required to ensure the long-term fiscal sustainability of a community.

Persisting with processes that create annual budgets based on past budgets with incremental changes, does not take into account the volatility of the economic environment in which we are operating. Nor does it provide for future stability.

While Zero Based Budgeting is an old tool; when used correctly it provides a process for budgeting, which promotes a more thorough operational analysis which can be based on an analysis of current and future variables affecting revenues and predicting outcomes for more than a single budget year. In particular, costs associated with personnel and benefits, the largest percentage of most government budgets, must be reviewed and analyzed based on long-term liabilities. Additionally, long-term planning for infrastructure maintenance should be should be based on a ten to twenty year horizon, not the traditional five-year planning scenario. This process requires more intense and focused planning, including a realistic environmental scan that provides a thorough understanding of the impact of growth and future service needs, coupled with changing economic conditions and other factors that impact service delivery.

To be successful, the budget process must be a fluid process, revenue projection and expenditure analysis must be ongoing and not a once a year static process. Adopting a process similar to what successful companies utilize requires looking at governmental management in a different way than we have in years past. In the private sector, successful companies routinely incorporate "what if scenarios" or projected outcomes which might be triggered by certain events and constantly monitor those events and the potential impact on the budget. In local government, we should be examining potential "trigger events" such as weather phenomenon and its potential impact, economic or community issues and other variables including political shifts, which may affect not only the stability of resources, but the services required.

The economic, political and cultural components of our communities are constantly changing. Therefore, the way we budget and plan for services must be more inclusive and consider both the current and long-term impact of these variables. Efficient and effective local government management requires long-term sustainable solutions not just annual budget 'quick fixes'.

To accomplish this goal,

Managers must learn to be adept at

Determining when to contract services and when to add the necessary overhead to provide direct services with City employees.

Establishing fund reserves for future growth and needs for capital planning and infrastructure on a long-term basis.

Managing growth and not letting the growth drive service demands.

Knowing how and when to restructure the city organization and keep staff focused on the bigger picture-the vision of the elected body and its citizenry.

Recognizing that government is not always the answer to a service delivery problem

Thus, managers must learn to create alternative solutions to service delivery by asking different questions including:

What are the Services we provide? What services should we provide? What is the true (total) cost of that service-dollars, people, infrastructure, overhead etc.? Is there a way to provide this service more cost effectively and efficiently?

Why do we provide this service? Does it really meet a current need? Do our citizens really want this service? Does it truly promote and protect health safety and welfare of our citizens? In other words is it truly a CORE services that is a necessity that should be funded by local government? If so,

Who should provide this service?-County? City? Private? Can we give up control/turf to improve the service or make its delivery more efficient by finding a better provider(s)?

How should the service be provided? Are there different types of service delivery that might work better? Is there a new technology which can provide the services more cost effectively in the long run?

In summary, local government finance and budget management is more than a standardized set of guidelines and processes; it can and must be innovative and visionary, seeking long-term fiscal sustainability.

How to Utilize Home Budget Software

You Need a Budget

Budgeting is very important. It is unfortunate that so many people don't budget their money. Whether you have very little money or a lot of money, you should be budgeting so that you know where your money is going and you know that you are spending it correctly. This'll maximize your financial security and help you live a more stress-free and rewarding life.

A budget is not a complicated thing. It is very easy to make and once you've been following it for a while, it becomes second nature to you. You can adjust it whenever you need to and you can make your savings increase quite a bit just by setting up a strong budget.

Setting up a budget means determining a certain amount of money that you're able to spend in each category of spending in your life. You then follow that spending and are able to save the amount of money that you have figured out.

Software Adds Simplicity

If you are worried that budgeting is too complicated, software can make it simpler. If you find a good piece of home budget software, you can set up a budget very easily and follow it just as easily. Home budget software helps you determine how much money you need to save, how much money you can spend in each category, and helps you manage that spending so that you make sure you don't go over your spending limit.

Quicken is one of the most popular pieces of home budget software because it is so effective and affordable. Make sure you find a piece of software that gives you what you need and is not too expensive. If you spend thousands of dollars on home budget software, you are pretty much defeating the purpose of budgeting in the first place. Be a smart spender especially with your software.

Stick with your Home Budget Software

Once you have your software and you have your budget set up, the best thing you can do for yourself is to stick with it. There will be times you need to adjust your budget and sometimes you make over under, but if you can stick with that budget, you will complete your financial goals. Work hard and keep a strong budget and you will reap the rewards.

Save Money on Your Christmas Shopping With These Christmas Budget Ideas

When making a Christmas shopping budget it has to be planned very carefully. With the upcoming Christmas shopping season, we would love to run out and buy whatever we like for the people on our list. Unfortunately not many of us have that luxury.

Budgeting your Christmas gift buying is a must in this tough economy. Setting and sticking to a Christmas budget is very important for buying Christmas gifts so no one will be left out and you won't be emptied out.

Saving Money for Your Christmas Shopping

Saving money is the key when it comes to a Christmas budget. Banks will have a Christmas fund where you can actually add money to all year round. When Christmas arrives, you can take the money out for your Christmas shopping without any penalties.

You could also stash a set amount of money away in a jar for your Christmas budget each week until you had enough to cover your shopping budget. A few dollars a week wouldn't be missed and you would be amazed how quickly the money would add up.

Low-Budget Christmas Gifts

Another great method for meeting your Christmas budget is low-budget Christmas gifts. Budget Christmas gifts are great Christmas gift ideas. You can buy them throughout the year and hide them away. This eliminates all the stress and worry about money around Christmas and you can focus more on enjoying the Holiday Season. It's a wonderful feeling.

Christmas shopping this way is way more enjoyable and fun. There is plenty of time to look around and find hidden treasures, deals and stuff on sale that may not be available or at the price you can afford when the Christmas shopping season starts. Remember to keep your receipts and check if the item you're buying in the Spring or Summer can be exchanged or returned 6 months down the road.

A Smart Way to Use Credit Cards

When it comes to using credit cards for Christmas shopping, be smart and have a Christmas budget worked out. With high interest rates and being low on funds at the end of the year, you will end up going over your budget from the interest rate alone if you can't pay back the money you borrowed in time.

Think of your budget Christmas ideas when using your credit card. Save money and stick to your Christmas budget by shopping throughout the year. Pay your bill every month like normal and keep the holiday spending under control at all times.

If you start to over spend, you will be able to stop quickly and get back on budget. But you should have a set amount of money for your holiday budget. Otherwise the interest will kill your budget. Make sure you pay off the card completely every month if you can.

Remain Calm and Don't Panic

If you do go over your Christmas budget, don't panic. Unforeseen circumstances can happen. Like a price increase because of a sudden high demand for an item. You can recover by purchasing some budget Christmas items instead while out doing your Christmas shopping.

Why is Budgeting Important - Tips For Creating an Effective Budget

Why is budgeting important? What is involved in budgeting anyway? Once you know the answers to these questions, you will be able to save more money, get out of debt and achieve financial flexibility.

A budget is one of the most valuable tools which is required to keep track of your personal expenses. Planning a personal budget teaches you to be prudent while spending money and equips you with good money management skills which many people lack.

Personal budgeting helps in making planned investment for the future for greater financial security and stability. Besides, using a budget plan can help you tp figure out your monthly income and expenses and accumulate savings for fulfilling your personal and family needs in the long term.

Many people fail to realize the vast benefits which they can derive from developing a personal budget. Planning an effective monthly budget can help you to realize your dreams whether it is going on a vacation trip, renovating a home or buying a vehicle.

You will learn to attach greater significance to money when you know its value and you will learn to spend it more wisely when you have a budget. Besides, people who make their own personal budget can understand where their money is being spent and learn ways to curb excessive spending. A good budget can help you to repay you debt obligations quickly and save more money for the future to realize both your short and long-term financial goals.

Budgeting can also help you assess your money in-flows and out-flows. So, if the money you are spending is more than the money that you are earning, you can consider ways of earning more money or making some decisions that will help you to cut down on your expenditures.

Steps to prepare your own personal budget plan

1. To create a budget, the best way is to use a spreadsheet program, if you are familiar with using computer applications. There are plenty of budget sofwares which are available on the internet which can be used for working out a budget plan. However, if you are not very comfortable using computer-based applications, then you can simply use a pen and a paper to make your own budget.

2. Create two columns comprising of income and expenditure and first list all your fixed expenses which may include your loan repayments and other debt obligations. You can make different categories under variable expenses like grocery and food items, shopping, entertainment, dining etc and add both the fixed and variable expenses together. In the same way, calculate your total income from all the sources after deducting the tax and other costs from the gross income to get the net income.

3. The next step will be to subtract all your monthly expenses from the monthly income to find out the result. If you get a surplus, then you can use this money to build your savings for the future to meet any emergency expenses. On the other hand, if you get a deficit, then you need to plan your expenses well to curb extra spending otherwise you could land up in a debt situation very soon.

4. Almost 20-25% of the expenses can be easily reduced, if you can manage to cut down on your entertainment and credit card bills, which can significantly add to your savings. Paying off your debts quickly can help in eliminating your debt burden and accumulate more savings for the future. You can compare your budget every month to see if there has been any improvement in your spending pattern over the last month in this manner.

So, now you know why budgeting is important - it helps you to closely monitor your income and expenses and identify areas where you can cut down on expenses.

7 Essentials To Do Successful Household Budget Planners

Do you want to save on your household needs? If your expenditure is running out of your budget and this is frustrating you, then its time to budget. Well, a household budget planner can be helpful to organize, track and manage your finances. If you want to manage your earnings in an effective, simpler and faster way, then the budget planner can be one of the effectual means for you. Further, it is possible to customize your financial planner to your precise household budget requirements.

1. First of all, you should make a decision on the income to be scheduled for your budget planner, which will be best suitable for all your household requirements. Further, if you want, you can create your planner monthly, bi-weekly or weekly, depending upon your pay periods.

2. After this, enlist all your fixed household expenses along with the mortgage or rent, taxes, loan payments, flood, insurance, homeowner's rental fee, etc. Categorize your each expenditure.

3. Then, make list of all household needs, which are variable, yet should be scheduled for each month like school supplies, utilities, clothing, grocery budget, auto, phone, maintenance and others.

4. Further, catalog other personal requirements like daycare, camps, work lunches, coffee, tobacco, sports, school, etc. Evaluate daily expenditures, as it will help you to figure a budget.

5. Next planner category will be entertainment. This will include budget for cable, videos, magazines, concerts, vacations, movies, association dues, dining out, clubs etc.

6. Incorporate short and long term savings in a budget planner category like retirement, education, charitable giving, investments, larger purchases, household remodeling, grand occasions like weddings, etc

7. Combine all household expenses to get projected budget amount for every category on budget planner.

This can surely help you to get an idea about your overall needs and expenses for households. Determine the categories, which are creating a big hole to your pocket. If you think there is more expenditure on entertainment, then you can cut down on it to save your balance your expenses and savings.

So, still here? Get ready to make your own household budget planner and lead a synchronized life, even if your income is not too high. This will save a lot of your earnings, thereby, considering all your important needs to be fulfilled.

How To Set Up Your Wedding Budget

Starting to think about your wedding budget is a confusing and at first, daunting task. From favours to dresses, flowers to photography, everything single thing you spend on your wedding counts towards your wedding budget. Therefore it's important that you start well and continue in that manner.

Where to start
Before filling in your wedding budget, start to think about what how you want your wedding to look. It's important to discuss your ideas with your fiancé as you may find that you have differing opinions. You may want a romantic style wedding, but your husband to be had something a little more modern in mind.

So, sit down with your partner and think about how you want the wedding to look. Talk about the things that have always featured in your dream wedding and make sure you agree on a theme or look and feel that you're both happy with.

How much money do you have to spend?

Next, work out how much money you have to spend. Dare I say it, but the best place to start is your parents. Find out if they'd like to contribute to your wedding, or if there are any specific things they'd like to pay for. Make a note of this along with any savings you have put aside for your big day and this will form your wedding budget.

Fix it there. Don't try and add to this amount with loans or extra credit as this will only add undue stress on the run up to your wedding and at the beginning of your married life.

It might be a good idea to open a "wedding bank account" or get a "wedding credit card" as these will help you keep track of all your payments. This way each month, you'll know exactly how much you've spent on your wedding. (If you do get a credit card, ensure it is one with a 0% introductory rate and that it gets paid off each month. The interest charges shouldn't add to your budget!).

Find talented friends and family

Now, think about if you have any talented friends or relatives for things like photography, toast-master, chauffeur with beautiful car, stationery designer, dress maker, beautician etc.

You'd be surprised how many of your friends and family will want to help you on your big day and it's a special honour for them to be involved. It will also make your wedding a lot more personal for you as well as help your wedding budget.

How many guests?

The next task is to work out rough numbers of guests. This can be quite hard as it's easy for the numbers to creep up, especially if you have to invite Great Aunt Maud, who you haven't seen since you were five.

You'll need to be quite ruthless here. Some ideas for keeping control of your numbers are:
- invite friends, but not work colleagues
- include relatives up to and including first cousins only
- no children

This is a difficult one, and again, you might want to include your parents on this discussion as I can guarantee they'll give you a few surprise invites that you hadn't thought of.

Think about major costs

Once you have a rough idea of the number of guests and all your helpers in place, start to think about some of the major costs such as venues, drinks, catering and place rough costs in your budget planner.

First, give your preferred suppliers a quick call and establish if they're free on your day and the likely costs for your numbers. You'll be able to quickly rule out if they're within your budget or not. If you're happy with the rough quote, ask for a more accurate, written quote.

Start putting rough costs in your budget

Now you've decided on your suppliers for the more costly items, you can start to fill in your spreadsheet. Don't forget to keep updating it with the most accurate figures!

Costs a little too high?

Having done all the ground work, are your costs still way over your budget? You may want to consider if the four layer cake or the twelve piece band really is that important? This is a good time to think about prioritising what's really important for your big day.

You could splash on one area and save on others. Perhaps that designer dress is a must, but you're happy to design and make your own stationery? Discussing those little extras and prioritising with your fiancé is crucial to making sure you stay on budget and out of debt.

Alternatively, put the wedding date back and have a longer engagement to ensure you'll have enough money to pay for all those little extras.

The last word

Most brides think that it's the big stuff that puts them over budget. Of course, if you splash out a little on one of the more costly items, it can send you thousands over budget. However, it's the smaller stuff that will really start to make your budget creep up. Spending an extra £20 here or there soon mounts up.

So watch out, and don't forget to keep all receipts and update your wedding budget regularly.