Budgeting

Nearly every organization or group has some sort of budget process that they undergo. When budgets are treated as friendly tools, they end up being one of the most meaningful planning methods. On the other hand, when budgeting becomes a meaningless exercise that is largely ignored, it often becomes the missing ingredient in effective strategic planning. Budgets should be used to help analyze and determine an organization's needs, priorities, strengths and weaknesses. It should begin with a thorough analysis of what an organization is doing right, what is doing wrong, what too much money is spent on, and what more monies need to be expended. Far too many organizations approach the budget process simply by taking the past budgets and adding an across the board (or similar procedure) percentage. When budgets are used wisely, they help open up the eyes of an organization to the realities, needs and priorities, as well as their strengths and limitations. The wise budget leader reviews all revenues and all expenses, and then puts them into perspective with the needs and priorities. The first rule of creating a meaningful budget should be that with the exception of contracted, fixed expenses (and even at times those need to be reviewed and adapted), every item on both the revenue and expenditure side should be carefully reviewed, evaluated and analyzed.

1. In creating a meaningful budget, all estimates on the revenue or income side should be extremely conservative. Although they should be realistic, they should never include hoped - for estimates for items like fund - raising revenues, etc. These should be budgeted for based on averages, so as not to end up in the hole at a later date. On the other side of the budget, expense/ expenditures should be using near worst - case scenarios, so that there are no unpleasant surprises. In addition, organizations must never approach the budget as an excuse to waste funds or spend on items that are not necessary, because any surpluses can be better utilized by putting them into reserve funds for future relevant and important needs.

2. When creating a budget, one of the most frequently overlooked areas are in creating contingency reserve funds, built right into the budget. These funds/ reserves must be fully funded no later than the midpoint of the fiscal year. Some reserve funds that should be included include Maintenance Reserve Funds, and Emergency Reserves. These funds must be carried over from year to year, so an organization is prepared for the eventual and inevitable contingencies that will arise.

When budgets are used to plan the priorities and direction of an organization, the group invariably runs more smoothly and effectively. Those groups that use budgets as they should be used, soon learn that the budget has the potential of being the organization's best friend and most essential tool.

Creating a documentary budget is great way to think through every aspect of your film. Even though you may be eager to get started shooting your documentary right away, creating a budget can often be an enlightening experience, revealing factors that may otherwise slip under the radar. A budget forces you to think through every detail and can save you the agony of an unexpected surprise down the road.

In addition to being a great tool for the filmmaker, a documentary budget is essential if you hope to raise money for your film. A budget is usually a must-have item along with your documentary proposal when pitching your documentary idea to potential funders or supporters. A documentary budget provides an important snapshot of how you plan to shoot your film, the locations where filming will take place, how many people are involved in the project, what kind of equipment you're using and your distribution plan among other things.

Whereas your documentary proposal describes the story and vision for how your documentary will look on screen, the budget is your nuts and bolts plan behind the scenes.

Here are the three primary steps in creating a documentary budget:

1. Research - This is THE most important aspect of creating your budget. Without research, you have a blank slate. This is where you need to make phone calls, search the internet and ask for advice. You'll need to decide such things as what kind of insurance (if any) you need, how much a van rental will cost in the city you'll be shooting, how much your cameraman charges for three days of work, what's the cost of renting a lighting kit, what does the animation guy charge, will you need to pay copyright fees for stock footage, etc.


2. Build Your Budget - It's highly recommended that you use a spreadsheet program such as Excel or get your hands on a documentary budgeting template. You can certainly jot down your budget items using a plain text document, but this is not a professional (or efficient) way to do a budget. Having a spreadsheet with formulas allows you to make changes to individual items and it automatically updates the totals for the whole budget. As you conduct your research, begin inputting the various budget items including crew salaries, production equipment rental, stock footage fees, administrative costs, etc. Input everything you can think of!


3. Refine Your Budget - Once you've created your budget, you will surely be shocked by the final total cost. At this point, you will need to refine your budget to come up with a realistic final cost. Ask yourself the amount of money you realistically believe you can raise for your project? If you think you can raise $10,000 and your budget came out to $250,000, then you will need to make some hard decisions. Is there anything in your budget that is not an absolutely necessity? Or is there a way to get some items donated?

Creating your documentary budget is not a one-time event. The budget will need to be constantly updated and modified as you go.

One item you'll want to include in your budget is a contingency (usually 8-10% of your total budget). This is especially helpful if you're new to budgeting. A contingency provides a buffer in case items in your budget end up costing more than you expected.

In summary, if you are pitching your documentary idea to potential funders and trying to raise money for your film, you will more than likely need a detailed budget. It's absolutely critical that you create a budget that is as realistic and accurate as possible. Since many of your funders will be business-minded individuals, they will know if you fudged on your numbers. So do your research and put together the best possible budget that you can. As the filmmaker, you are probably eager to start shooting and making your film, but taking the time to think through every detail of your budget will pay off in the end.

If there is one thing that all IT managers want, it's more money. For you see, we all believe that if only the company would boost the annual budget for our IT team then just imagine the great things that we could do! You can sit around hoping that the company will suddenly realize just how valuable your team is or you can do something about getting a bigger budget. Let's look at what steps you can take to make this happen...

Getting Decision Maker Buy-In

One of the biggest challenges that an IT manager faces in getting bigger budgets has to do with getting support for their team. Often times the folks in the finance department have no idea what your team does for the company.

Take the time to educate both the finance teams and your company's management. Taking the time to do this will ensure that when it comes time to allocate budget money, your team will be at the top of their list.

Know Your Budget

Every line in your budget has a story behind it. Make sure that you know what your IT team's budget story is so that you can tell it to the people who will be allocating the budget dollars.

The one thing that you don't want to have happen is to have someone ask you about a line item in your budget and have you not be able to explain why you are requesting those funds. Make sure that you know what your team's budget story is and that you can tell it to others.

Practice Good Communication

Obtaining a budget for your team is a process that can take a considerable amount of time. During this time, make the effort to keep your team informed about what is going on and what the status of your efforts are.

By keeping the team informed, they will be able to keep you informed also. This means that if there are any unplanned events that occur, your team will be able to notify you and you'll be able to evaluate how they impact your budget request before anyone else does.

No Surprises!

Every budget request is based on a set of assumptions that you've made. As with all such things in life, things can change and those assumptions may turn out to be incorrect as time moves on.

Make sure that you don't get hit with any unpleasant surprises. If an assumption that you've made changes, then find out what has happened to change it. Once you know the background, take the initiative and inform the people who are in charge of allocating budgets - it is far better that they hear this from you than anyone else!

What All Of This Means For You

Budgets for IT teams are a case of give-and-take. What one team gets is what another team does not get. This means that if you want your IT dream team to get even more funding in order to do bigger and better things during the next year, you are going to have to do some budget negotiating to make this happen.

You are going to have to start things off by getting buy-in from decision makers. Then you are going to have to make sure that you fully understand your budget in order to ward off any questions. During the budgeting process you are going to have to show some leadership and keep your team fully informed about your progress. Finally, the one thing that can sink your quest for a bigger IT budget would be unwelcome surprises. Make sure that there aren't any!

It is possible to get a bigger slice of the pie for your IT team. However, this isn't going to happen all by itself. Instead, you are going to have to take steps to make it happen. Follow the steps that we've outlined for you and then you'll be able to sit back and make the most of your new, larger, IT budget!

Budgeting is a lot of fun! Why? Because it's simply telling a story. That's all it is - a story you create and write. You become a "seer", predicting events and conditions which you really don't know whether or not will happen.

A story told in numbers. How do you create a story that you understand intimately, a living document which changes and flows and which creates tremendous confidence in executing a plan for the upcoming year?

Begin with fantasy - the ideal events you would like to see happen in the upcoming year. Who doesn't like to daydream? Cost it out. The numbers will tell you what's possible and what's not.

Then, the challenge begins - what is really possible? It's fascinating to create various scenarios based on assumptions of the future. (easy to record the alternatives in Excel)

This is where everyone needs to be on the same page - budgeting = assumptions about the future. There is nothing concrete about budgeting. It's not a airy fairy exercise either. Budgeting is the best "guesstimate" for the ensuing year - that's all it is - so relax, breathe and have fun with it!

With due diligence, you can come fairly close to a realistic budget based on current facts and anticipated economic conditions.

How do you prove due diligence? With a little exercise that most people don't do. They've been taught to write out a huge report - a lot of verbiage about their analysis, conclusions - blah, blah, blah - and in the end, too much time is spent on verbiage. So why waste the time? I know - because it's expected, the standard, whatever other explanation there is. Fine.

Produce what is required but for yourself, create another type of document which tells you exactly how you arrived at each and every figure.

It's simpler and much more effective to create detailed notes about each and every line item in your budget, proving your figures by outlining your assumptions and calculations in one document, line by line. Key word here is "notes"! If anything goes wrong, the detail is there. If economic conditions change, you can make adjustments. You'll be the hero because you can anticipate problems before they arise and take steps to minimize the impact or you can "make your wishes come true". And you'll learn a lot about yourself too - you'll learn how you think, where you can improve your work and assumptive processes, and what's real, and what's not. How? You'll have all your notes and calculations to refer to quick and easy too!

And that's why budgeting is really a lot of fun - every single month the comparison of your actuals with your anticipated income and expenditures for each and every month tell you what's going on - in numbers - you don't have to read pages and pages and pages of verbiage - it's all there quick and easy. And because you built the budget this way, you understand it very well. No one can stump you in a meeting! Isn't it fun to see how well your "predictions" come true?

Working with your budget as your benchmark is the greatest way to manage appropriately. Your comprehension of your department or business increases, you become far more aware of the global economic conditions, you can employ your creativity to resolve upcoming issues before they cause major problems, you can be in touch with every aspect of your business continuously - no surprises for you! and best of all, you can relax knowing that financial part of your role is solidly in your control. What a stress reducer!

There are so many benefits to good budgeting practices, it's behooves me to understand why people fear budgeting so much and why such poor budgeting happens in so many instances. Massive budget over-runs are either a lie, a cover up or someone who created the budget didn't understand the operations. Why would anyone be in charge of creating a budget who didn't understand the operations? Budget over-runs may happen because of an act of God or some catastrophe that simply couldn't have been foreseen such as an act of terrorism or conflict, etc., but outside of those incredibly unpredictable events, budgets should be on target. Reasonable adjustments should be anticipated but not wild swings.

In other words, a budget should be a living thing that is amended as more information is gathered but the amendments should also be sensible, rational and moderate.

Now, go budget and have fun!

Most people find they go through a teething period when setting up their budgets. How to deal with? Don't stress! It's quite normal.

Budgets may well blowout in the early stages. It's important to recognize this as a sign we've not quite got things right yet and to make appropriate adjustments.

Ask yourself some questions:

• Was it just a one-off situation? E.g. car broke down, unexpected tax bill arrived.
• That's reasonably easy to handle - we'll discuss below.
• If not a single event, what caused the budget blowout?
• Have you left something out of your budget? Did you forget an expense?
• Can you cut or reduce any other expenses? Remember to shop around for cheaper phone and internet plans, consolidate expenses, cook up in bulk and freeze ahead etc. There are plenty of budgets how-to tricks for reducing expenses.
• If there is a serious problem and your budget simply cannot balance, you may have to ask some tough questions. Do you really need that gym membership? Jogging is free!
• Is it budget-leak? That's where all the little cash spending items adds up and you just keep running over.

If so, then:

• You may to get a bit tougher with yourself. Use the Cash is King method and never EVER cheat! Learn to spend less. You're doing this for YOU - nobody else, remember? New spending habits will take a while to adjust to.

Or:

• Your discretionary spending budget may be too tight - maybe give yourself a bit more 'wiggle room'. Remember - a budget that constantly leaks will eventually BLOW!

Savings are mandatory in any budget. Cutting your savings out completely is NEVER an option.

We are aiming for 10% savings (i.e. saving 10% of your after tax income) but even if we start off at 1%, that will do initially. There have to be SOME savings. These are what it's all about, remember?

These savings are intended to grow so you can then invest them. You want to send your money to go out to work for you. You can start small but you have to start somewhere.

Without Saving for Wealth Creation, you're not Budgeting to create Financial Freedom, you're merely surviving.

You may find that initially when you're still heavily focused on debt reduction, you simply can't save 10%. That's ok. Work out what you can save in the meantime (a minimum of 1%, ok?).

Once you're done with debt reduction, you'll have a lot more money available to put towards savings.

Let's go back to the first option above for a moment.

Say your budget blew out due to a one-off emergency expense.

A lot of people talk about budgets how-to but when they refer to savings, they actually mean an Emergency Fund. Savings however are solely for Wealth Creation! At least they are in my book.

It is very important to have an Emergency Fund, though. A separate bank account which you can trickle feed and build up over time usually works well.

In the early stages, there simply may not be enough money here yet to cover the emergency expense. In that case, you will simply have to hang in there and get through this period by being creative. You may have to cut back your discretionary spending, skip this month's extra debt reduction or even (god-forbid!) cut your savings amount down to a mere 1%.

Hang in there! As time passes, you'll build up enough money in your emergency fund to handle most situations without missing a step.

Whatever the reason, if budget blowout occurs don't let it worry you too much. It's a chance to learn, to tweak and fine-tune things. There are plenty of great budgets how-to techniques you can apply.

So keep up the good work!

Wishing you much Prosperity,

Miriam

Welcome to the world of "Budgeting"; a very important, yet widely neglected and misunderstood topic, in most households.

I am involved in several home-based businesses, but the most important of these by far, is managing my Monthly Household Budget. Notice that I used the word "business" to describe managing my budget. Unlike most people, I treat my monthly expenditures as a business-always looking to improve the services that I pay for by finding better deals, and reducing resultant costs. I always aim to get the best bang for my buck through increased services at cheaper costs. When I find a particular budget item that can save me $100 per month, I do not only look at this as a savings, but I treat it as if I just received a $100 per month raise, which translates into a $1,200 per year salary increase (assuming that it is recurring monthly). Yes, by being diligent and resourceful, I just gave myself a $1,200 raise for the year, which, by the way, is cumulative in effect, year-over-year. Wow! Now imagine if I can replicate this feat for multiple items in my budget, again and again. That is going to be some kind of hefty raise that I am giving myself. You see, by treating my monthly budget as a business, I provide myself with a means of increasing my disposable income and savings. I do not need a boss to give me a raise; through diligence and resourcefulness, I can give myself a raise, again and again, over and over, year over year. The long-term, cumulative effects of doing this can be quite staggering, to say the least, and one's overall net worth will increase substantially over the years, by putting this "business practice" in place.

I am an extremely compulsive and diligent budget person. Regardless of how large or small a household expenditure is, I record it in a tracking spreadsheet. I think my wife thought that she had married some kind of compulsive lunatic, when I implemented this system in my household. But, as time moved on, she recognized and understood the value of the budgeting system that I put into place in our household. Moreover, I have taught my 3 children the value of money and budgeting, and have attempted to interject these principles into their lives as much as possible. No doubt, that as adults, they will be much better off because of this.

I know exactly how much money I am spending in each category of expenditure on a daily, weekly, monthly, and yearly basis. I can honestly say that I have no friends, family, neighbors, or acquaintances that are as diligent and passionate about budgeting as I am. As a matter of fact, most people do not truly understand the art of budgeting. Sure they use the words "not in my budget" in conversation; but few, if any, actually understand what their budget looks like, how much it costs them to live each and every month, and how much money is going out-the-door in regard to their bills and expenditures for goods and services that they have procured. Many people I know constantly waste their money on frivolous spending, and neglect basic budgeting techniques and practices. Some of these areas of budgeting can individually save them hundreds of dollars per month, if implemented.

I have broken my budgeting techniques down into a series of categories listed here. Each category should have one or more specific Strategy items associated with it, that you will need to come up with. Some categories should have more budget strategies listed for it than others. Some budget strategy savings ideas will be relatively small in nature, but please do not discount these. After all, these little items do add up, and the net effect of the sum of all applied budget savings strategies, is what counts. That said, here are my budget categories that require addressing:

• Food
• Shopping
• Clothing
• Utilities
• Lawn/Garden
• Entertainment
• Household
• Weddings and Gifts
• Banking/Finance/Bill Paying
• Automobile
• Vacation
• Medical/Dental
• Other Insurance
• Taxes
• Education
• Mortgage
• Cost of Living

Next, I want you to develop a personalized Budget Action Plan while addressing each of these categories. I want you to buy a notepad (or alternatively, feel free to use a word or text editor on your computer, smart phone, or e-reader to accomplish the same purpose), and create 2 columns:

• Category: Strategy
• Budget Action

Traverse each category, one-by-one, and start listing individual Budget Strategies for each category above. Concentrate very hard on how a designated category and budget strategy item can seriously be applied to your household budget situation. Keep in mind that some Budget Strategies may seem overly simplistic or obvious. If relevant to you (and most will be), write down the budget category and budget strategy item, and one or more budget actions that you need to implement to put the category and strategy into place, keeping your personal situation in mind. Continue to do this for every Budget Strategy, in every Budget Category. Again, make every attempt to apply each category and strategy to your situation. Do not ever dismiss a particular category and strategy item because it only saves you $10 per month-these small items add up fast, and the overall aggregate monthly savings, when all is tallied up, will simply amaze you! When you have completed your Budget Action Plan, review it, and start implementing your Budget Actions, one-by-one, on a monthly, or need-be basis. By the way, it would not hurt if you went through your Budget Plan multiple times. This may easily facilitate new ideas and additional Budget Actions that can be implemented in your Budget Action Plan.

If you are honest with yourself, extremely diligent about implementing these budget actions, and have the necessary discipline to stick with it, there is no reason why you cannot reduce your monthly household budget by 20% (or more) in a given year. This should be an on going process, year-after-year, as you continuously review your expenses annually, to obtain that raise that you deserve!

Nowadays most people get very comfortable with paying for their daily expenses using credit cards. This is bad if they do not exercise self-control. This is because they may become addicted to this practice that they end up spending more than what they can afford or earn.

A way to prevent this from happening is to manage their expenses and income by having a proper budget. A budget is a tool that can help them to manage their money. And very likely this will prevent overspending resulting in unnecessary stress or ending up with liabilities.

However managing a budget may not be easy for some people. Some find the task of creating a budget a fuss and some just need help in creating a working and reliable budget. One way they can overcome this problem is to make use of money budgeting software.

In the market there are good software created by financial experts for the purpose of helping people to overcome the type of problem mentioned in the above paragraph. The software can be used to create a reliable and workable budget to help people manage their money wisely.

This is how most money budgeting software work. Most will help you to keep track of your spending and this in turns helps you to learn how to spend and as well as to save your hard earn money sensibly.

Here are some main benefits of using money budgeting software.

1. Keeping track of your expenses.

Most of the budgeting software can allow you to keep track of your expenses. Such ability allows you to get an understanding of your cash flow. You will also have an idea of how much money you earn, spend and what amount is left which then can be channeled into savings or investment.

2. Allows the creation of various possible projections of the future.

Using money budgeting software, you can do a lot more than just balancing or tracking the numbers. One of the extra features is that you can make some possible projections using the budgeting software. And once you are satisfy with the outcome you can print them out for record keeping. Alternatively you can save it digitally for future reference or tweaking.

3. You are in control.

Most people who do not have a budget to guide them usually tend to overspend. Making use of budgeting software can help you gain control of your expenditures. The software allows you to know ahead of time whether you will be overspending or not. Thus by knowing this before it is too late, you will take the necessary steps to prevent over spending more than your budget allows.

Thus at the end of the day, using money budgeting software can help you to budget. This gives you the peace of mind and control over your money. In this way, you are certain that all your spending activities are within your budget and had been carefully planned. Likewise the money you saved is properly placed in prudent investments.

Money Budgeting is a phrase that either bores them too much, or makes them depressed. But, this is how successful people deal with money - they budget. It's a lesson that must be learned to succeed financially in this life. Here is some helpful information.

Many people are lured into the trap of spending more money each week than they are bringing in and most people are doing this without even realizing it. The main reason this happens is because we are no longer taught or remember how to budget our money. With the introduction of credit, it has become easier to use money that you don't actually have.

This lack of money budgeting in today's world is beginning to reach a cataclysm with many families, and individuals who are now finding themselves with severe debt problems and little knowledge about how to turn their bleak situation around.

Even with all of the bad debt write-offs, banks are more than happy with the way things are. Banks build in their own risk factors based on bad debt in their interest rates to give them profit regardless of bad debt write-offs. Simply put, those borrowing money are paying for their inability to budget effectively.

Tips to Effective Money Budgeting

The basics of budgeting start with you listing incoming money over a period of time, such as a weekly, monthly or fortnightly, then listing the outgoing money, such as mortgage payments, car re-payments, credit cards and so on. Money budgeting also has many other factors used to make it effective, including keeping a constant eye on how your budget is doing and changing it to accommodate unexpected problems without overspending.

Keep all of your receipts and account for what has been spent. Use this to make calculations as to where your money is going and for what. Expenses can be divided into four main categories. These are:

-Housing: mortgage, rent, utilities, property taxes, insurance, etc.
-Work: transport, parking, work clothes, lunches and if you have children, day care
-Living: food, clothing, medication, insurance, etc.
-Personal: entertainment, newspapers, magazines, alcohol, gifts and education, etc.

Once you have categorized all of your bills, take out a blank piece of paper and a calculator. Figure out what is being spent each month on these categories and what can be cut out of the budget to allow more money to go toward bills or improving your financial situation.

Many people get so used to luxuries, they turn these things into fixtures in their weekly, fortnightly or monthly spending habits. By weeding these expenses out or making them a luxury again that is only enjoyed occasionally, you can also save quite a substantial amount of money. When you go through your spending habits, you will be able to calculate how much you are actually spending on these things.

Don't forget that a contingency fund should always be factored into any money budget. This works out to be around 10 % of your income. A contingency fund will benefit you when you need it the most, such as when you lose your job or have an unexpected expense such as plumbing go wrong in your home. This contingency fund should be kept in a separate savings account and only accessed in emergencies.

Motivation Is The Key

Motivation is very important when you are budgeting. As an incentive to create a budget and stick to it, remember that the only way to regain wealth is by spending less money than you are receiving. The only way to spend less and do more with your money is to learn how to effectively budget it and stick to your plan.

Once you start to see the benefits of your budgeting and are rewarded with more money in your bank account after you have finished paying out, you will be more encouraged than ever to budget your money.

Another way to teach yourself to budget is to give yourself a solid incentive to stick to it, and make your budget work. You may make it your goal to get your finances in order, so that you can take a vacation or get something that you and your family really wants. Place reminders on your fridge or in your wallet. By doing this, you will be reminding yourself of the reason you have decided to sacrifice some of your luxury spending.

Although this sounds great, when you budget, you will have to learn to set aside any emotions that you may feel toward your budget. Examples of emotions getting in the way and interfering with a well planned budget is when you have to cut out the things that you want, such as weekend breaks away, toys for your children or new furniture, for a while, until you have arranged your finances for the better better.

If you have a family, try to keep them involved in your money budgeting and where the budget needs to be tightened to benefit everyone to exclude non-essentials, explain to family members why budgeting is important. This will help to educate those around you about the importance of budgeting and how budgeting can help you all obtain the things that you want, such as luxuries, without them being a financial burden.

Another trap many people fall into is getting into the habit of 'keeping up with the Jones' regardless of their own personal financial situations. After all, money budgeting is about your personal set of circumstances and your personal finances, not someone else's. Just because your neighbors have just bought the latest model car or had cable television installed, doesn't mean that you have to, pay attention to your budget and let it be your decider on whether you can afford the things that you want.

Budgeting is a vital skill needed to control your finances and avoid getting into serious debt. By educating yourself on how to budget effectively, taking the time to carefully plan a good budget and monitoring it regularly you will be able to keep yourself and your family encouraged to stick with it. Set achievable goals and even though, at first, money budgeting may seem tough, it is the only way to have the things that you want, as well as a secure financial future.

You just graduated college, started a new career, got married, had a child, bought a house, bought a boat, whatever the case may be budgets are used at every stage of life. Budgets are used as a planning tool to set financial goals. Budgets are used to plan for the future to be allocating the proper resources today. Setting up a budget is very uneasy and uncomplicated, there are even online tools that will do it all for you. The harder part of the equation is determining what percentage of your income goes where. There are general guidelines about personal budgets out there, but a budget can provide you with a much better comparative advantage if it is tailored directly to your finances. Personal budgets serve people to plan and see how much money they want and can spend on each sector of their life. It is up to the individual how much money they want to put where so budgets differ greatly. Some budgets can provide people with a mechanism to save up for something that they desperately want, and once they have achieved that goal their budgeting is done with. Others use budgets as a daily tool to regulate how much money they spend on each sector of their life so that their finances can be balanced with the adequate funding.

Whether people admit it or not, budgets are complied in the mind of the individual even if they do not put it on paper. Most people have an idea in their mind how much they want to spend on what but when unexpected occurrences arise they get confused and often make bad financial decision. This shows the importance of putting budgets down on paper or on the computer so you can see the ratios of where your money is being spent. Budgets also act as an indicator to see where you are over spending and overspending. You might have not been aware of it before but your entertainment budget is greater than your food budget, may you have a problem with this and maybe you do not, it is up to you. But budgets allow you to see this information and you can assess any way you want.

Personal budgets can give a person more freedom because they do not have to worry about any unexpected expenses from affecting their daily life. When setting up a budget it can be beneficial to over account for such items as food or utilities so that there are no surprises when the bills come around. Personal budgets not only act as a planning device but they also act as a regulating device. If you go over budget in one sector that means that you have to directly reduce funding in another. This means that you will never go over budget because you are manipulating your budget so that you do not. Your budgets can be flexible must you must be aware that providing to much variance can cause you to loose track of the general concept of budgets.

As most people say, time is money. It is also very important that people learn how to budget time so that they can be more productive and efficient. The skill of knowing how to budget one?s time should be learned early on, especially before one joins the workforce. This is because having discipline with budgeting time is a skill that young people will find very important in the workplace. Young people can learn to budget time by focusing on their priorities.

Planning a study system

Planning a study system while you are in college can become an effective tool in making your college life more bearable. A study system can help you avoid the stress of cramming and all-nighters. Before you create your study system, you should first assess the subjects that you are taking and allot the appropriate amount of time that you think you need for each subject, depending on the difficulty of the subject. Your study system should also be flexible enough to allow changes, depending on how you do in the subjects.

Preparing and reviewing

In college, studying means that you need to prepare and review for subjects. Preparing involves reading assignments, doing library work, writing papers, memorizing vocabulary and solving practice problems. On the other hand, reviewing involves going through your notes, going over reading materials and clarifying new principles and ideas introduced in the class. To help you review, you should set aside a regular review period, which can help preparing and reviewing for exams much easier.

Finding time to rest

Apart from allotting specific times for studying, it is also important that you allot time for sleep and other activities that can relax you. You cannot spend all your time studying since doing so will only cause you to burn out, and you will not do well on your exams if you are always tired.

Starting early in learning the value of budgeting time can become a powerful tool for people who wish to live productive lives. Knowing how to budget your time does not only ensure higher productivity; it also means that you have enough time to enjoy the good things in life.

In recent years, there have been numerous calls for company to move away from Excel-based Corporate Budgeting to Business Performance Management/ Business Intelligence (BPM/BI) systems. Reasons cited include:

1. Slow throughput time due to the complexity of the budget.
2. Challenges in maintaining data accuracy during consolidation.

Despite the repeated summons to move away from Excel-based Corporate Budgeting, today about 70% to 80% of all corporations (from big corporations to small companies) continue to make use of Excel for their budgeting. So what makes these budget managers stand behind Excel and remain loyal to using it as their primary budgeting tool?

The 6 Benefits of Using Excel for Budgeting

The current method of Excel budgeting is not without constraints. However, the advantages for using Excel as a primary corporate budgeting tool overshadow its limitations.

1. Excel provides budget managers with a lot of control on the format of the template. Budget managers can change the layout of template when the business environment changes. With a BMP/BI system, budget managers have to give up the control to design a template that meets their business needs.
2. Budget contributors are familiar with Excel spreadsheet that requires no or minimum training to complete the template. However, they are usually too involved in their operations to find time to learn another application which is used only a few times a year.
3. Budget managers and contributors could add new worksheets to store their workings and provide an audit trail on the basis for their budgeting numbers.
4. The number of people involved in the budgeting process is not limited by the number of licenses paid. Anybody who owns a copy of Microsoft Office can be involved in the process.
5. Companies do not have to constant upgrade their software so that it will work with the latest operating system.
6. It is expensive to own a BMP/BI, which cost at least $50K (conservative estimate) and beyond, not to mention that IT support staffs are usually required in maintaining the system. Using Excel for corporate budgeting would relieve the company the problem of finding IT staff to maintain the BMP/BI system in the midst of a worldwide IT staff shortage.

At the present moment, there is no other alternative software that could match the benefits brought by excel in budgeting. Budget managers assume they have to operate within the limitations of Excel if they want to continue using it as their budgeting tool.

Now, we have developed a revolutionary method of Excel-based Corporate Budgeting that we promise that will wow budget managers and make them want to lay their hands on. We believe it's a solution that every budget manager must know, even those who are currently using BMP.

In this revolutionary solution, we retain all the benefits contained in the current method of Excel Budget. We just added more benefits and also remove the limitations contained in the current method of budgeting.

1. Those who are working on the budgets do not have to follow strictly to the layout by the budget managers. They can change the sequence of the budgeting lines based on their preference. They could put advertising cost on the first line in the template followed by marketing cost and vice versa.
2. You can easily transfer the budgeted numbers from the template to another worksheet and form a database simply by using formula. The database can be used to create pivot table for analysis and reporting.
3. Analyze the budget numbers from different perspectives. You can analyze them by products, by channels, etc.
4. Prepare reports and charts by special links which don't have to worry which line the item is located. And even when the item changes row or columns, you will still get the right numbers for your report.
5. No loss of details during the process of consolidation. The details from the lowest level i.e. numbers submitted by the different business units are captured into the consolidated database. The consolidation will automatically update the budget numbers from different business units, add new rows, delete old items and also change the numbers as the numbers in the template changes.
6. Consolidation can be as quick as a few seconds to a few minutes, depending on the number of business units you need to consolidate.
7. Analysis can be done at the highest level with the lowest level of details. For example, you can analyze staff cost by departments or even on a country level. You can even prepare pie charts to show the contribution from the different business units or countries.

What can be more taxing other than planning your personal or your company's earnings, expenditures and revenues? To make the task of tracking finances easier, the technological advancements have found out an ideal option - Budgeting Software. In fact there are various kinds of budgeting software's, which are currently available in the markets. Budgeting software's can actually make it possible for you to track down your expenditures in a much fruitful way.

First step towards planning a budget is to define categories, which will help you in sorting your incomes and expenditures in a systematic manner. You can also split up the transactions categorically. Some of the popular budgeting software's available in the contemporary markets are:

o You Need A Budget

No budgeting software can get simpler than this. Easily affordable at a price tag of just $19.95, 'You Need A Budget' (YNAB) comes with 60 days money back guarantee. This software comprises of 3 spreadsheets, namely, Register, Budget and Overview. The first spreadsheet makes a record of all the incomes and expenses while the second one sorts the spending category as well as enters the budget for each month. The Overview reflects your personal income and also the average amount spent on each category. This budgeting software saves time and reduces stress. It also makes it easier for you to deal with fluctuating income and you can move on to save for unexpected or unaccounted expenses. The user manual explains you each action in detail and also provides logical reason as to why you should opt for it.

o PearBudget

Available originally to the users as a spreadsheet, PearBudget is now available as a web based online budgeting solution. You can use PearBudget irrespective of the operating system in your machine. If you have any of the following browsers, namely, Mozilla, Opera or Internet Explorer, it becomes even easier. Effortless to install and trouble-free to use, you can actually download PearBudget for a 30 days free trial without even disclosing your credit card information. This software helps you plan your budget by taking into account your expenses and it also gives you the option to import your budget as a CSV file. To get started, all you need to get done is to select the categories to divide your expenses. Furthermore you need to select the categories as regular monthly expenditures and irregular expenses and then enter your budget amount. The software will then proceed to calculate and let you know how much amount needs to be saved to meet the upcoming irregular expenses.

o Quicken

This budgeting software comes in four different versions and has gained extreme popularity because of being more user-friendly compared to the others. It is very easy to navigate through this software. The home page itself reflects the summary of your personally projected cash flow and all the other personal financial data is available in form of easy-to-read visual reports. The financial overview section contains data related to your savings schemes, income tax returns and fillings and also reflects your net worth. The details about your investments, home loans, automobiles loans can be seen under Investing and Property debt centre. The 2008 version of this software offers you an additional feature called 'My Savings Plan', which helps to roll over the surplus dollars automatically into next month's account. You can even track your PayPal account using Quicken.

Selecting proper budgeting software will play an important role in planning your future and also helps in savings and faster clearance of debt. So opt for the appropriate budgeting software and set out on the journey of financial stability.

If you want your budget to succeed over the long term there are eight things that might have an affect on your effectiveness to hold fast your budget. Identifying and conquering these things is essential to stay on the right track and achieving your budgeting objectives.

1. Neglecting to set an objective - A budget with no a goal will quickly fizzle out. You cannot truthfully expect to stick a budget for any period of time if you have not set a goal for it. Budgets are just like weight loss programs, they are simple to get started on but tricky to follow through to the end. You have to have constant inspiration - the objective you determine for your budget is your main source of encouragement.

2. Inability to make room for stimulation - Let's be truthful, daily life on a budget is not very exciting. Take away the pleasure and you'll dislike it a whole lot more. Main point here, save room in the budget for all the things you love and sit up for. You are much more apt to stick to your budget over the long haul if you can still enjoy yourself. Though it inevitably brings about living on a budget for a longer period than you had initially planned for, leave room for all the things you love inside your budget.

3. Over budgeting - Over budgeting is where you scale back too much from your budget, more or less depriving yourself of necessities in an effort to achieve your ultimate goal faster. This results in something I call "budget burnout", when that happens the budget goes right out the window. Bottom line, it's fine to scale back some but not so much that you're literally depriving yourself of what you require.

4. Sizeable sudden expense - Of course you aren't able to foresee when emergencies or unplanned obligations will come about; what you can do however is prepare yourself in case that one actually does happen. This is why it pays to get an emergency fund in place. An emergency fund should cover the unanticipated extra expense, your budget should be untouched and also you will not have to add additional debt unnecessarily.

5. Outgrowing the budget - You have obtained your goal and have finished everything you set out to accomplish with your budget. Congratulations! Budgeting has gotten you this far, so why not carry on? It's time for you to expand your horizons, think of a bigger, broader goal for yourself.

6. Unattainable goals/expectations - It's hopeless to keep to a budget that you set unreachable objectives or expectations for. You are usually just setting yourself up for frustration. You have to make a purpose for your budget that's measurable and most of all, plausible.

7. Neglecting to keep tabs on expenditures - Not monitoring your spending is the equivalent of shooting yourself in the foot. Tracking your expenses could appear challenging but it's not really. Understanding exactly where the money is going keeps you in control and makes it far easier to continue inside the limitations of your budget.

8. Giving in to impulse - This is often sort of a hard one to get under control, you just never know when you are going to be enticed. If you sense the need to shop or expend money impulsively try to use the need vs want rule (ask yourself "do I need it or do I just want it?"). If that fails you could also use the 2 day rule in which you wait a couple of days, if you sill feel that you NEED it following two days - go on and buy it.

Many of us have negative connotations associated to the word budget. We feel it is restricting, not allowing us the freedom to spend our hard earned money the way we choose. We view budget as something which needs to be done by those who are struggling financially. Budgeting, however, is a fundamental concept which must be adhered to if financial success is to be achieved. Having a budget is a common characteristic among those who have earned their financial success. The lack of a budget is a common theme, typically, among those who are struggling financially. Budgeting isn't punishment for not being wealthy. A budget is a means to determine where your money is going, something we all need to be able to do. Creating a budget is a way to determine whether you are spending more than you make. At the heart of financial success is spending less than you make. You simply can't spend more than you make, at least not for long. So, what are the basics? The two fundamental questions to answer when creating a budget are; "What's going out?" and "What's coming in?"

The place to start creating a budget is figuring out where your money is going right now. There are a number of ways this can be done. You have to discover what works for you. I have tried different approaches to tracking expenses, computer software, spreadsheets, notepad, and check register. I have found a simple excel spreadsheet works best for me. Easily customizable, spreadsheets do the calculations I need and I can input the information in a manner that best suits my needs. You can start inputting entries from bank statements, credit card statements or from where ever you can obtain the information for the budget. Track you spending for about a month. Adding up the amounts will give you a good idea about your spending habits. A few guidelines in setting up your spreadsheet are listed below:

o Typical categories are housing, food, recurring bills, and entertainment.

o Categories should fit your lifestyle. Include those areas of spending that are unique to you.

o Account for the once or twice a year expenses such as auto insurance and taxes.

The next area to address is what's coming in. Determine your monthly income including wages, interest income, dividends, and bonuses. Once you know how much you make and how where you are spending the money, you've got a budget. Adjust the spending until you achieve balance between your income and expenses. Your goal with the spreadsheet is to fine tune it until you have a line item for all the income and all the expenses you incur. This fine tuning process will highlight areas of spending which may be out of your perceived spending plan. By having setup the budget you are now equipped to make the adjustments needed to bring about financial success.

The final step is to get into the habit of budgeting. To be successful this will take persistence. You will have a number of slip ups along the way. Don't be discouraged by this. The goal is not perfection in record keeping, but, rather money management. Here are some tidbits to help you on your journey.

o If you can't spend less to bring balance between income and expenses, earn more.

o Pay cash whenever possible and record the transaction.

o Develop a habit of thinking ahead. Plan for upcoming situations and prepare for it.

o Keep good records. If you don't write it down, chances are you won't stick to it.

o As your finances change so should your budget. View the budget as a living document that changes with you.

Creating a budget is advantageous when planning for your financial future. The budget is really a tool to determine spending patterns and habits. A budget is a way in which you can take control of cash flow. An excel spreadsheet or computer software can be a viable resource when creating a budget.

Most budgets are created by taking the previous budget, comparing it to the actual expenses, adding in anticipated new programs, and often merely adjusting the numbers by an estimated percentage, often based on the cost of living, or some other factor. While this is the prevalent method used in budget preparation, many people, including me, feel it is not the most effective way to create a budget. The use of the traditional budgeting method has also created a widespread attitude, by many, that the budgeting process is merely an exercise, rather than a valuable financial tool, that it should be.

Conventional budget preparation techniques often do not evaluate the value of programs, nor do they assist in the prioritization that organizations and other entities should perform to make them as effective as possible. Organizations need to plan on an ongoing and continuous basis, if they are to evolve as they must to strive and survive. They need to evaluate how they spend their money, on a regular basis, to assure that their organization is getting the most "bang for the buck." Often, it is not necessarily the amount of money that an organization spends, but rather how it spends its money. Generally, an evaluation of an organization's budget, as well as its Profit and Loss Statement, indicates that there are times when more should be spent on certain items, while there are also situations when there should be less monies spent on other specific items.

Zero-based budgets force its preparers to look more deeply into its budget. In following this technique and methodology, an organization will use a budget not only as a financial exercise and guideline, but also as a serious forecasting, planning and action/ result related document. Organizations that utilize zero-based budgeting must look at how they are presently spending money, line item by line item, and ask important questions. Doing this, organizations ask whether they are prioritizing their programs and expenditures in the most efficacious manner. They look at each of their programs, evaluate them, and determine if they should be continued. This causes the organization to discuss and decide whether more or less monies should be spent on each item than previously. This helps create a focus where organizations are better able to think about its future direction, and creates a form of "thinking outside the box."

When zero-based budgeting is not performed, organizations often continue spending money ("good money after bad") on programs that may no longer be relevant, or simply are not a "good fit" for the organization. Often, that money could be better spent in other areas, and since most organizations do not have unlimited revenue, they must carefully spend their funds. Evaluation of a budget via zero-based technique integrates an evaluation of finances and how they align with the organization's mission and purpose.

Zero-based budgeting is often misunderstood and misconstrued by untrained leaders, who may have simply heard that zero-based budgeting is good. These individuals often do not understand what it truly represents. The single biggest misconception that I have observed, on several occasions, is when an organization's treasurer or budget officer says he has prepared his budget using zero-based budgeting. Rather, what has often been done is that the treasurer takes it to mean that a specific amount is allocated in a specific area, and that whoever in the organization responsible for that area, then has the right to determine how to spend the money, within those budgeted constraints. However, zero-based does not mean that one must spend the monies in a specific area, if some cost savings is found, that accomplishes what needs to be done for less expense.

I urge all organizations to consider the use of zero-based budgeting. In order to do that effectively, effective usage of budgets, and fiscal responsibility should be part of the curriculum of the organization's leadership training.