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100+ Tax Tips for the Separated, Divorcing and Divorced Military Marriages, Military Divorces Divorce Personal Information Planner When Business Owners Divorce © 1997-2003 |
True Prosperity: Your Guide to a Cash-Based Lifestyle [by K. C. Knouse, Double-Dome Publications, © 1996, 5½" x 8½", 220 pages, Table of Contents, Excerpt, $13.95.] Shipping Excerpt: ImplementationAt this point the practical aspects of living on a budget may intimidate you: How do you go about implementing the budget to reach your goals? How do you keep track of what is spent in each expense account? How do you know at any given moment how much is left to spend in a particular account? you may experience apprehension about losing track of your accounts and blowing the budget. That is natural; you don't want to fail. The Envelope MethodYou have a detailed budget, and the detail can overwhelm you. But there is an easy way to implement your budget. I call it the envelope method. You don't need a complicated set of books. You don't have to learn accounting. In fact, it is so simple that it is often ridiculed as being old-fashioned. Nevertheless, the envelope method works. All you need are some standard, letter-sized envelopes. How to Set Up Your EnvelopesYou will need one envelope for each of your variable monthly expense accounts, including the cushion account but not the savings account. Do not include the fixed monthly expense accounts. These accounts, along with the savings account, will be handled in a different manner. Label each envelope with an account name and corresponding monthly budget amount. Using the sample budget from Chapter 5 as an example, you would label the envelopes: Food $240, Gasoline $30 and so on, until all accounts had an envelope.Cash a check for the total amount of your vairable monthly expenses, including the cushion account but not the savings account. Remember, do not include fixed expenses from Schedule 1. Then place the appropriate amount of cash into each envelope. You have just converted your paper budget into cash with each envelope representing a budgeted expense category. Keep the envelopes together in a handy place like a dresser drawer or desk drawer. How to Use the EnvelopesWhen you incur budgeted expenses, simply take the money you need from the appropriate envelope. When an envelope is empty, you have spent the budget for that account for the month. You cannot spend any more money from that account until the cash is replenished at the beginning of the next budget period. If you do not spend all of the cash in an envelope during the period, leave it there to accumulate and add the budgeted amount for the next month to it. Keep adding the budgeted amount to the envelope each month event though there is an accumulation. This money will be needed to pay expenses incurred for that account in the future. For example, repair and maintenance accounts do not have an expense every month. However, when they do have an expense, it is often large enough to require more than the amount budgeted for a single month. This accumulation of expense money from month to month is nothing less than saving, saving regularly every month to pay expenses you know will occure sooner or later. When they do occur, you will have the cash to pay for them. You will not have to borrow. © K.C. Knouse Message Boards and LinksVisit the Message Boards and Recommended Links for more information and resources about divorce. Domain Name for Sale |
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