Total Personal Budget??? Totally. Day 2.

Personal Budget Plan Terms to Know:
Necessities: this describes everything you need to live, including your taxes. Rent, utilities, debt payments, presents for Mother’s/Father’s/Kid Sister’s birthday, even your cable bill if you can not live without it. Think responsibly. You will pull this information from WBT #1 – the Budget. Don’t worry about one-off expenses, just the ongoing stuff. Missed the Pre PERSONAL BUDGET PLAN step? Rejoin us when you finish.

Without judgment, determine where you are spending money. By looking at 3 to 6 to 12 months worth of account statements, you can really see the pattern of your spending. If you’re really clever, you’ve charted it out in a spreadsheet.

Asset (Intermediate) Savings: This is longish term savings to which you have relatively quick access. For example, you may be able to borrow against the value of your LONGEST term savings, but you will use what you have in intermediate savings to make the down payment. This is a great way to build assets within your personal budget. If you hope to buy a house, investment property, other large asset, oftentimes you need a sizable chunk of cash upfront to make the deal happen. This is where you build that sizable chunk of cash Personal Budget plan-style.

Emergency Funds: This is money you stash each and every month so that you can handle the occasional financial jolt – replacing the roof on your house, down payment for a new car (not typically an appreciating asset therefore an expense), and unexpected medical bills.

Vacation Funds: I see you bonding with your Personal Budget now…. This money is for your rest and relaxation. Whether you take 15 trips of NYC to SF each year, one large cruise from the US to the Mediterranean or you rent a beach house on Wrightsville Beach, NC – this is how you plan to pay for it. It is meant to be used. A happy and healthy you becomes a wealthy you. Your boss can live without you for a few days . . . I promise. Miss Mentor says so.

NOW$: Blow your wad, I dare you. *snark* This is the money you use now. Go ahead, use it guilt free. If you have set up the rest of your Personal Budget Plan responsibly, this money can be used as you see fit, when you see fit. Use this account for all the dinners out, shiny shoes, aero bars for your time trial triathlon bike, new fishing pole with extra blah, blah, blah, etc. This is your release valve. This is the chocolate cake in your diet. Don’t be afraid to spend it, but once it is gone for the month . . . it’s gone.