Ways To Get Out Of Debt

Posts Tagged ‘budgets’

Budgeting

Each successful businessperson or girl knows that each business needs a budget and unless your business is very big and complicated, you do not want an accountant to draw up a working budget: all you need is an easy spreadsheet and a couple of hours of concentrated effort.

So let’s make a start

Open up your spreadsheet programme: Microsoft Excel or equivalent

The Time Line is set out across the head of the spreadsheet. Each column in the spreadsheet corresponds to a month so Jan, Feb, Mar, Apr etc

You need to do this so you can calculate your cash flow.

Income and Outflows

The horizontal lines – the rows – of the spreadsheet correspond to cost and income heads: salary, rent, electricity, apparatus hire and so on.

Revenue and Cost Items

The revenue and exepense items are subdivided into three main groups:

1. Your predicted operating revenue i.e. Your payments
2. Your regular expenses expenditure i.e. Wages, purchases for stock etc
3. Your asset expenditure i.e. The amounts that you pay for capital goods or services that you are going to use over an extended time period.

Capital Items

Capital items are normally depreciated. You could buy a lorry and expect it to last three years of operation. This each month you would charge your operation 1/36th of the price of your lorry as a ‘depreciation ‘ charge.

Next Steps

Now lay out your months across the apex of the spreadsheet leaving one column – on the left – blank. Then start on your costs and income in that spare left hand columns.

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Part two of the The St. Louis Community Credit Union video on how to create a spending plan for yourself or your family. Do you have trouble paying your bills? Do money emergencies create a rises? Are you unable to save for retirement? Watch this video!

The St. Louis Community Credit Union has tips on how to create a spending plan for yourself or your family. Do you have trouble paying your bills? Do money emergencies create a rises? Are you unable to save for retirement? Watch this video!

This video covers the basics of budgeting, and how to get over the initial hurdle of starting.