the importance of doing tracking expenses It is essential to have control over money, save and make future investments.

To achieve financial goals it is important create a budget with the income you receivebut, if you don’t know how to do it, here we suggest a step by step, according to experts, to achieve it.

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How to create a budget?

The first step you should take in creating a budget is know your fixed income each monthbe it your salary, payment for real estate, pension or health insurance.

If you work independently, it is important that you keep track of your contracts or income in order to manage them.

expense tracking

Now, when you keep in mind the amount of money you receive, the next thing is to ask track your expenses. The first thing you should know is suitable are your fixed coststhat is, monthly or biweekly costs that you inevitably have, these can be market, gasoline, rent, debts, credit cards or entertainment.

When you keep these expenses in mind, you will be able to know that could reduce or avoid such as, for example, the use you give to credit cards, the amount of entertainment expenses you have, among others.

It is recommended that you can keep these records one by one on a document or sheet of paper to make it as realistic as possible. One thing that might help you remember your expenses is to review your bank statements.

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Create realistic goals

After considering the characteristics of your monthly expenses, take a moment to think about your short, medium and long term goals.After this, calculate the investment you should have with each of these. Some thoughts on the subject It could be a trip that you have wanted to take for a long time, study or pay off a debt.

think about these goals will help you constantly keep in mind the need to save and it can even become a great motivation to do so, for example, save to take a vacation at the end of the year.

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set up a plan

Financial entities offer these programs

After tracking your spending and thinking about your plans for the future, you should create a plan to be able to allocate your income to your needs and planes. That’s how it could create some limits to make the task easier.

There is a technique to do this that allows you to divide your income into three aspects: fixed expenses, entertainment and savings.

the rule of 50/30/20 defines that 50 percent of your income must allocate to your fixed expenses, such as their homes, meals, services, debts. At the same time, 30 percent of your monthly budget can invest it in shopping, entertainment, travel. Finally, 20 percent of the budget that would save and this amount I would allocate aircraft that have a short, medium or long term.

always remember adjust this budget to your needs, remember cuts you can make or expenses you could avoid. Although this technique is recommended by experts, adapt it to your needs and keep in mind to review your budget frequently, because as your life changes, your expenses and priorities change.

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