Determine Expenses

Determining your expenses is very important for your budget. When you add up how much you really spend in a month, you may be surprised. Mainly, there are three kinds of expenses:

There are some fixed expenses like house rent do not change from month to month.

Flexible expenses are necessary items like elctricity/power bill that have varying amounts.

Finally, discretionary expenses are things that you don’t really need, but may be important to you. Travel might not be a necessity, but it may be important for you to visit some of your close friend or relative.

Keep every receipt and record each and everything that you purchase, down to that daily candy bar and Cola from the vending machine.

Make a list of current amounts of bills. See if there are any areas that you could cut costs? See what areas you could afford some cut backs and enter the new amounts in the adjusted amount column. Then add your total monthly expenses.

One more thing to remember, buying fewer name brands can lower your grocery bill while going out to eat once a week instead of twice can save a lot at the end of the month.