All In

My adventure as I jump into life all in!!

The Other Half of the Budget

on February 4, 2014

This post is part of a budgeting series. See All the steps below:

Budgets, Where To Start?
The Nitty Gritty
Budget Deficit
Cutting Your Grocery Bill
Keep Those Dollars In Your Pocket
I Need Extra Income
Irregular Incomes

Last week we went over Step 1: Write down all of your expenses. If you are just joining us, follow the link to go to step 1.Now that you’ve written down your expenses, have you noticed any trends? Where does all your money go? Now that you’ve had time to think about your expenses, it’s time to move to the next step.

Step 2: Write down your income.

This step should be easy. How much money do you make each month? If you are budgeting for your family, include your spouse’s income as well. Also, on a side note, make sure your spouse is on board with the budget idea. It is hard to stick to the budget if one of your is not in agreement and constantly overspends in certain categories. Make sure you write down ALL sources of income. If you babysit for your neighbor every Friday, write that income in your budget, if you sell cookies at your local coffee shop, write the income down. Any way that money comes into your hands needs to be written down.

Now, a question you might have is, should I write down my pre-tax or after-tax income? I prefer to write down my after-tax income because that is the money that I actually see. I also have health insurance deducted from my check, so I just write down the amount of my paycheck that I ‘see,’ basically after tax and benefits are deducted. (On a side note, that doesn’t mean that some of your ‘unseen’ expenses can’t be examined later, but we’ll discuss that later).

At this point you should have all of your expenses written from Step 1, and now all of your income listed. Come back next week to find out what Step 3 is. Feel free to comment below. Was it difficult to budget for your income? Do you have an irregular income such as commission?

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