Financial Planning: How To Make A Budget

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A Budget is a Financial Plan for Success

Many people do not have or follow a budget, and some even shudder when they think of the word budget. One reason is that they just do not want to think about finances because it is a source of stress for them. This type of thinking could lead to disastrous results and ironically add a great deal of trouble and stress to their lives.


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Debt Free & Frugal Living, Financial Freedom

You should think of a budget as a plan for success for the future. It is not a tool to restrict you in your life. A budget is a very useful and wise tool to help you to plan to have success in your finances, by insuring that you are living within your means and not spending more than your income.



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A budget also helps you to plan your savings to insure that you will be able to meet future financial goals such as paying for your car, paying off your debts, paying off your house mortgage, saving for vacations, saving for your children's college, saving for retirement... Below is information that will help you to come up with a plan for your finances, or to help you to revise your current budget if needed.



  •  Make a Budget and stick to it (include $ to pay bills, pay off debt, savings...)
  • Follow Guidelines - Percentage of Net Income (after taxes):

Housing (mortgage/rent, taxes, insurance)      25%
Food                                                                        13%
Donations/Gifts to Charity                                   10%
Transportation (loan, gas, insur.,repairs)          10%
Utilities (water, electric, gas, garbage)               10%
Medical/Healthcare/Dental                                   5%
Clothing                                                                    4%
Entertainment, Recreation                                    4%
Miscellaneous                                                         4%

Debt Reduction*                                                   10%
Savings/Investing                                               5-10%


  • percentages will vary somewhat due to various factors, including where you live, your income, your age, your circumstances...
  • once you pay off all debts, you can add money from  this category to savings/investing and other categories.
  • Stick to your plan ! Do not give in to temptation to spend more than your plan.


"The plans of the diligent lead to profit as surely as haste leads to poverty."
Proverbs 21:5


We want you to be successful, and to be debt free and enjoy financial freedom.