Loans By Kathy: Every Household Should Have a Budget - Getting Started

Every Household Should Have a Budget - Getting Started

 

Every Household Should Have a Budget!  The key to financial success is to have a plan.  So to formulate that plan, you need to have a household budget.  

 

So let's talk about how to prepare your budget.  The biggest obstacle for most is just getting started.  It seems like a daunting task.  But these helpful hints will get you started.  Here is what I recommend my clients do first.  For the next 30 days, I want you write down every penny that you spend.  

 

At the end of 30 days, tally your expenses by category.

How much did you spend on housing?

How much did you spend on utilities?

How much did you spend on groceries?

How much did you spend on your vehicle?

How much did you spend on clothing?

How much did you spend on entertainment?

How much did you spend on medical expenses?

How much did you spend on insurance policies?

How much did you save?

 

I like to put all of this in a spreadsheet so that changes can be made easily.

In my next blog we will talk about how to put the budget together.

 

 

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Kathy Sheehan Senior Loan Officer

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The opinions and general information in this blog are soley those of Kathy Sheehan.  Specifics regarding an individual case should be discussed in detail with a loan professional.  For a confidential consultation, please feel free to contact me via phone or email.  All terms and conditions are subject to change.

 

Comment balloon 25 commentsKathy Sheehan • August 12 2013 05:51PM

Comments

I agree with your regarding your statement that evey household should have a budget, also I children should be included in some of the process to help educate them on the financial aspect of running a home and keeping budgets.

Posted by Michele Cadogan-Cell 917-861-9166, Licensed Real Estate Associate Broker - (Fillmore Real Estate 2926 Ave J Brooklyn NY 11210) about 5 years ago

Michele, I agree with you.

Posted by Kathy Sheehan, Senior Loan Officer (Bay Equity, LLC 770-634-4021) about 5 years ago

Great topic, Kathy! With the economy being the way that it is, it's more important than ever to have a budget to help keep a reign on spending. If you don't know where your money goes, you'll never be able to keep up with it.

~Emcee

Posted by Emcee M. Arah, Realtor w/Architectural Dimension, CRS, CDPE, CIAS (Remax Excellence - Silver Spring, MD) about 5 years ago

Hi Kathy, great topic to write about.  It is so important to have a budget not only for this crazy economy but also for first-time homeowners that really how no idea what needs to be paid each month.  Excellent list! 

Posted by Karen Johnson, Realtor, ABR, "Bucks County PA Homes" (Addison Wolfe Real Estate ) about 5 years ago

You are so right, but this is so painful to actuially do. I'm glad I have Quicken to help me do it. Otherwise, I'm not sure I would be able to stay organized. 

Posted by Dana Hollish Hill, Lead Associate Broker (Hollish Hill Group, Keller William Capital Properties) about 5 years ago

Kathy - getting started is typically the most difficult step of establishing a budget.  The findings can be quite surprising.     

Posted by Michael Jacobs, Los Angeles Pasadena Area Real Estate 818.516.4393 (Coldwell Banker Residential Brokerage) about 5 years ago

Emcee, regardless of the economy, everyone should have a budget.

Karen, most of my clients that complete the exercise are stunned at the results.

Dana, everyone needs to find their own system.

Michael.  I have found that this works well for my clients.

Posted by Kathy Sheehan, Senior Loan Officer (Bay Equity, LLC 770-634-4021) about 5 years ago

Kathy~ Making a budget does not need to be an overwhelming task. This is a great way to get started!

Posted by Donna Foerster, Metro Denver Real Estate Agent (HomeSmart Realty Group) about 5 years ago

Donna, the most difficult task for most is just getting started.

Posted by Kathy Sheehan, Senior Loan Officer (Bay Equity, LLC 770-634-4021) about 5 years ago

Good morning Kathy,

What a great list you have created to help those get started in what can appear to be a daunting task of getting started formulating that much needed budget!

Posted by Dorie Dillard CRS GRI ABR, Serving Buyers & Sellers in NW Austin Real Estate (Coldwell Banker United Realtors® ~ 512.346.1799) about 5 years ago

Thank you Dorie!

Posted by Kathy Sheehan, Senior Loan Officer (Bay Equity, LLC 770-634-4021) about 5 years ago

I applaud you on this post ... LOUDLY, Kathy!  Great idea.  You paint potential clients (and others) a clear picture of some of the first steps they need to take to good financial health and preparation for successful mortgage financing.  Good for you!!  Suggested!

Gene

Posted by Gene Mundt, IL/WI Mortgage Originator - FHA/VA/Conv/Jumbo/Portfolio/Refi, 708.921.6331 - 40+ yrs experience (NMLS #216987, IL Lic. 031.0006220, WI Licensed. APMC NMLS #175656) about 5 years ago

Kathy,

The sooner you start to save the better. Unfortunately, most household don't consider a budget until it's too late. That's why the retirement savings gap is in the trillions. If you don't account for all you spend, how can you ever hope to save effectively? Thank you for this post!

Posted by Phil Stevenson, CRMP, Reverse Mortgage Expert in Miami and Florida (PS Financial Services 305-791-4874 or 888-845-6630) about 5 years ago

Gene, that is high praise coming from you!  Thank you!

Phil, exactly the point!

Posted by Kathy Sheehan, Senior Loan Officer (Bay Equity, LLC 770-634-4021) about 5 years ago

This will be a great series of blog posts for people Kathy! So needed by everyone and usually never done. 

Posted by Shar Sitter, Home Staging and Redesign Minneapolis/ St. Paul, M (Rooms With Style) about 5 years ago

Shar, it is really disappointing how many do not budget.

Posted by Kathy Sheehan, Senior Loan Officer (Bay Equity, LLC 770-634-4021) about 5 years ago

Kathy, I have suggested this post along with Post 2 and I am re-blogging both for my readers. Excellent posts!

Posted by Sharon Parisi, Dallas Homes (United Real Estate Dallas ) about 5 years ago

Kathy, great post. I wish they would teach personal finance in high school.  The world would be a much more responsible place!

Posted by Lisa Friedman, 29 Years of Real Estate Experience! (Great American Dream Realty) about 5 years ago

Great Post, Great information for all!  Great for a re-blog!

 

Dawn

 

Posted by Las Vegas Real Estate Agent Dawn Barrier, South Las Vegas, Henderson, Summerlin Homes (eXp Realty) about 5 years ago

Kathy, came over here from Sharon's re-blog. I agree with Lisa that personal finance should be taught in high school. In fact, begin in elementary and teach it again in middle school. It's never too early to learn.

Posted by Sharon Alters, Realtor - Homes for Sale Fleming Island FL (Coldwell Banker Vanguard Realty - 904-673-2308) about 5 years ago

Thank you Sharon!

Lisa, I agree with you.

Thank you Dawn!

Sharon, I agree with you.

Posted by Kathy Sheehan, Senior Loan Officer (Bay Equity, LLC 770-634-4021) about 5 years ago

Kathy, I think a money management class should be required for high school graduation.  Great list you have there, and hopefully many will tune in next time for your next budgeting blog!! :)

Posted by Sonja Patterson, Texas Monthly 5-Star Realtor Recipient for the Hou (Keller Williams - BV) about 5 years ago

I agree with you Sonja.

Posted by Kathy Sheehan, Senior Loan Officer (Bay Equity, LLC 770-634-4021) about 5 years ago

Great post thank you, it's hard to think of the things one needs to budget, and this is a great general overview!!

Posted by Christine Farkas, Awesome Customer Service Experience (Keller Williams Western Realty) about 5 years ago

Thanks Christine!  I am glad it was helpful.

Posted by Kathy Sheehan, Senior Loan Officer (Bay Equity, LLC 770-634-4021) about 5 years ago

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