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Figuring out your budget is the first—and possibly
the most important—step in getting your finances in
order.
Start
by filling in your monthly income and monthly expenses.
Remember, it's monthly, so for items like health club
memberships or bonuses, which are generally once-a-year
payments, divide by twelve. Credit card charges should
be split up according to whatever you spent the money
on (groceries, clothes, etc.), but interest and finance
charges have their own category.
Then
just press “Calculate Results” to get your total income
(after tax), total expenses, and cash flow, which
is simply your income minus expenses.
If
your cash flow is very low—or in the negative numbers—you’ll
need to either earn more or start prioritizing. (It
might not be as hard as you think; to take a peek
at our money makeover couple's budget and what our
experts suggest, go to: Pop-Up
Budget.)
Then,
for fun, subtract your liabilities (all that you owe)
from your assets (all that you own) and find out your
net worth.
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