Spending plan

Posted by Tad Johnson - Feb 5th, 2008 at 18:02

Chances are, your income is going to increase dramatically when you start your first job after graduating from college. Success!money.jpg

Sadly, your expenses are going to increase dramatically as well. Without some wise planning, you could easily find yourself slipping into debt. Here’s an approach to prevent that from happening:

Develop a spending plan

Your plan should include these main areas :

  • Regular bills (rent, car payment, insurance, phone bill, etc.)
  • Debt repayment (credit cards, college debt)
  • Regular savings (retirement savings, savings for large purchases, rainy day savings)
  • Categories of spending with a broad brush (clothes, food, entertainment, travel)
  • Expected monthly totals (savings will increase by $x; debt will decrease by $y)

This isn’t as hard as it sounds. Here’s a handy spreadsheet that will do most of the work for you: Spending Plan. (It’s in .xls format so you can open with Excel, OpenOffice, or import into Google Docs.)

Don’t obsess about accounting for every last dollar–this will only frustrate you and you’ll end up giving up on the whole plan. Instead, this should be an exercise to help you understand where all that hard earned money is going. When I did this, I was surprised by how much money I was spending on my car. Now, I take the bus or carpool a few times each week and all of a sudden I have more cash for the fun things in life.

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  1. […] spreadsheet software or specialized financial software like Quicken to layout your spending plan (the Vicenarian has a few tips) and track it by loading in your account records.  It is slightly more secure […]

    Pingback by Newly Corporate » Blog Archive » 3 Fast and Easy Budgeting Methods — February 7, 2008 #

  2. […] Know your budget You can read more about budgeting here or at thevicenarian. It’s not as hard as it sounds, and it’s a crucial step in living a rich life. Without […]

    Pingback by Newly Corporate » Blog Archive » Live Rich on Any Paycheck — February 13, 2008 #

  3. […] Know your budget You can read more about budgeting here or at Newly Corporate. It’s not as hard as it sounds, and it’s a crucial step in living […]

    Pingback by thevicenarian.com » Live Rich on Any Paycheck — February 13, 2008 #

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