This post comes from hard learned lessons. I quit my job in May of 2007 to start my own business, neither of which did I have any business doing. At the same time we decided that I was going to home school our two boys. All this rolled along from one bad idea to another. The biggest thing that we did not change was our lifestyle because we did not have a budget. We maintained credit cards, and our bank was happy to increase the limits without being asked. We asked to get rid of a loan and was given $20,000 more to spend. All while having our income cut by a 1/3rd. Our out of control spending culminated into a bankruptcy in 2009.

We Know What It Means To Hit A Financial Low

What follows are several lesson my family did learn, and are learning now that can help you and your family get through a tough financial time on less. The better news is you can do this when times aren’t rough and save more money for when times are.

I am not a financial planner or lawyer. I am just a guy that has learned hard lessons who wants to share them with others so they may avoid the pitfalls my family made.

Understanding where your money comes from, and where it goes can be intimidating to say the least. But once you know how to watch your money like a hawk, it can become second nature, almost ritualistic.

Managing your money starts with and income outflow sheet. You need to know how much you and your spouse (if you have one) bring home every week, two weeks, or what ever strange payday you may have. This can be an estimation if it is a strange pay pattern, or if it is commission only work. I worked for a company that payed us on the first and sixteenth, by check only after four pm. so I could have a nine-day pay period one time, and a thirteen day period the next. take the average and use that.

Once you know your income, start adding up the bills. I organize them by 1st of the month and middle of the month. Then add the two halves to get the total. After you have these numbers you need to subtract your outflow (bills) from your income (paychecks) to find out what you pay each month. Once you know this number you can start making a budget.

The Budget

Simplistically speaking all you need to do is figure which bills are going to get paid with the paycheck designated as first of the month paychecks, then which bills are going to get paid with middle of the month paychecks. After you have matched up paychecks to bills, make sure you use that check to pay those bills. Watch for floating paychecks. If you get paid biweekly your middle of the month paycheck will move to the first of the month, and your first of the month will move to the middle over a period of six months. Make Sure You Pay Attention To This. This can give you and extra paycheck every six months to put toward paying down a bill if you watch and pay your bills correctly with each check.

If you need to see it you can download Dave Ramsey’s Budget Forms Here

I know this is a simple synopsis, but why would I make it hard, that is for the experts.