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Budgeting Lessons 6 through 10

Lesson 6: Budgeting For Emergency Funds?
Lesson 7: Manage Money In Business
Lesson 8: Budget like Mom
Lesson 9: Basic Tips to Manage Money
Lesson 10: Manage Money and Save More


Lesson 6: Budgeting For Emergency Funds?

Emergency funds are considered to be a necessity as far as financial security is concerned, since it can provide one with financial resources that one can resort to and depend on when an emergency arises such that when one is sick and have the burden of paying huge medical bills, or unexpected home or major car repair.

When one has no emergency fund, one can be obliged to acquire debt on your credit card that might take several years to repay with interest that would later cost so much more.

However by putting an extra thirty to fifty dollars every month in an individual “emergency savings account” one can be secured with what emergency the future may bring. In doing this, it is recommended that one regards the emergency fund as an additional bill, to be punctually paid each month.

Yes, one can and should budget and allocate the extra money for emergency fund, as this is very significant when one refers to his “financial future”. Here, the goal is to create savings from budgeting your income; the emergency savings should ideally be equal to at least three months your living expenditures.

What’s important is that you should steadily put a certain amount of money aside, and only use it for real emergencies.

Not like an investment, the success of one’s long-term savings funds does not really count on the amount of return or interests but on placing a fixed amount of money away constantly and steadily so to have immediate access to it at all times.

In spite of one’s financial status, the initial step in the process of constructing an emergency fund is by knowing where your money is presently being consumed or spent.

When one recognizes and determines where one’s earnings are spent, then it will be easy for one to choose and make a decision where to trim down expenses. In other words, budget.

Budgeting is putting or setting aside money for anticipated and unanticipated future use. It is here that one sets up a goal so as to save. So set an emergency fund as your goal.

Checking, savings, money market accounts and “certificates of deposits”, are great places to keep one’s cash that might be needed on quick notice.

The amount saved from budgeting can either go to your savings goal, emergency fund or both. One could utilize the money saved from budgeting financial expenses by saving half of it to your savings account and half of it for emergencies. This way, you achieve your goals in savings and at the same time put in funds for emergency use. It’s your choice.


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Lesson 7: Manage Money in Business

Handling a business is similar to handling a home, with all the different expenses to consider preventing the business from going under with deficits and bankruptcy. A business has “children” in terms of all the employed workers working hand-in-hand and with utmost efficiency to make sure that the finances float above break even. There is one main focus for a business to thrive and exist in security and balance, and that is the knowledge of knowing how to manage money in business with the overhead and operation expenses.

The Main Focus: Overhead and Operation Expenses

Overhead and operation expenses are all those billings and outflow of financial allocation in order for a business to run smoothly both internally and externally with society. These all include the wages and payroll system for all the employees, and staff who handles administrative jobs. Also in this regard are the different community utilities such as the water and electrical services. Another is the internal service personnel such as the security, and janitorial services. Finally, all these are subjected to the different taxes for the building, business, benefits of employees and other imposed fees from the local government.

Without proper and substantial funding for any of these, the business will surely have a hard time operating at full efficiency and thus would put the whole venture at risk of either being overrun by competitors or be shadowed by loans and bills.

Wages and The Payroll System

Employees and administrative staff are dependent on the wages that they garner from the administration of any business. One may consider this as the lifeblood of any entrepreneurial endeavor. Too much of a rate in wage and one may expect a negative profit for the business. Too less of it would result to employee dissent and probable risk of being left for another competitor with a higher wage rate.

The wage rate is as important as balancing the allowance of kids if compared to a home setting. Improper allocation, neglect, or overly budgeting for it may affect other aspects for proper budgeting.


Common in any environment and setting of existence in a modernized community, the utilities are crucial to the operations of a business to furnish the required output, may it be in kind or in reports for the administration to study. Electricity is utterly important to allow Electronic Data Personnel in computing and foreseeing the budgeting and future prospect of the business versus the community needs for their kind of service. Another is that electricity is needed generally to provide comfort and convenience to the clients of the establishment to retain clientele.

Internal Services

Internal services which include the janitorial and security services are as important to businesses, especially when the size of the company becomes bigger and would require a more complex organization of human resource. These two services are important for the maintenance of the physical security and existence of a specific establishment from being unpleasant for the eyes of the clients. Furthermore, security service is essential to provide the sense of needed security of clients when they would be entrusting their hard earned cash and resources and exchange these for services which the business offers.


Not one is exempted from the community taxations to contribute to the community and benefit from the different infrastructures and community services which the local government imposes. Besides from being a requirement by law, allocation of budget to taxes is a crucial way to manage money in business to properly set the establishment with government plans.

The way to manage money in business becomes more complex as technology and services are upgraded over the years. Nevertheless, the focus remains the same and simple, but dauntingly task oriented.


Lesson 8: Budget Like Mom

Budgeting is truly the turf of most mothers. Aside from the traditional role imposed on mothers as the one who budgets the family finances, mothers have the instincts and foresights on what might happen in the future.

But how do moms really stretch the budget? She neither uses complicated formulas nor magic tricks but simple ingenuity and common sense. Peek in through moms” secrets in budgeting and learn. Role modeling is a good way to encourage attitude, especially towards money.

1. She clearly knows where all the money goes. Usually it goes to child care apart from the housing, health insurance, food and clothing. It is unlikely for her to cut cost on her children.

2. She studies all options given to her in terms of child care. Before she decides, she examines all aspects like safety, health and education.

3. To understand more, she talks to local child-care specialists and works out schedules with her employer for bonding time with kids.

4. For working moms, it is double the effort. They take care of the house and the children and at the same time work. She incorporates practical ways to accomplish both roles.

  • Wearing professional clothes than trendy ones.
  • Stays elegant but simple through a combination of basic colors.
  • Dry cleaning costs a hefty amount, so, she dons on wash-and-wear clothes.
  • Tone down on accessories.
  • She engages in a lot of do-it-yourself habits like in cleaning spots and ironing wrinkles in her personal wardrobes.

5. Moms always shop with a list in her hand to keep track of her budget and expenses. She makes sure she does not exceed. Also, she has no time for checking out tempting stuff at the shopping mall.


Lesson 9: Basic Tips To Manage Money

So you already earned your money. The next question presented to you is what you are going to do with it. Even when one has the list of payables and obligations to liquidate the monthly charges, a means of properly handling the money is required to be able to maintain a stable and consistent budgeting. Here are some basic tips to manage money.

Know When to Stop

Probably the hardest thing to do is to stop when it is needed, especially in terms of having more than what could be paid off. We should be able to know what things are plausible and valid to be supported with our own means of productivity. When we get more than what we could support, chances are that we end up giving them up, or worse, wrongly choosing what things to retain and what things to let go.

The idea of knowing the needs and wants also fit in this description as we should be able to determine first what things we need than want. This prevents us from being biased in our judgment in acquiring. More often than not, the things that we want are more appealing and are a greater risk of snagging us in a trap of financial burden and chaos in the long run.

Taking time to stop and think first and then evaluating what to prioritize first is essential to a progressive and stable money management.

Impulsiveness Means Disaster

One of the basic tips to manage money is to stop one’s self from being impulsive. Even if we have already determined what to prioritize, we still have to further evaluate for alternatives and not actually spend on the first offer that comes our way. When we are impulsive, there is a very high chance that we risk our money into spending for something that we could have gotten away with at much of a lesser price.

Risk Is Healthier Than Full Security

Risking the resources we have for a productive cause and viable profit earner is a healthy practice to take by an individual. Though this may mean a loss of capital in the form of personal money, not investing and instead just putting it in your personal safety vault or the bank will stagnate your extra resources.

Nevertheless, careful planning and feasibility study of a business venture is needed to determine the most efficient way to establish and commence a risky business deal into a promising profit earner.

Planning Ahead Is Essential

Even if we still have a lot of flexible time to just sit around and enjoy each day as it passes by, planning ahead of schedule in terms of a few months to several years is important in projecting one’s self when the future comes.

It does not have to be followed as rigidly as it should be, but just enough to become a basis of many activities and choices by the individual. Knowing where to go and what to do lessens the chances of getting stuck up in a crossroad of future choices. Furthermore, this lessens the worries and anxieties that a person might be thinking as important dates draw near. In addition to that, these pre-set guidelines would serve as a means to calibrate the performance of the self with the intended output, therefore allowing him to properly reset or recalibrate the means of work and production in order for him to further increase the expected outcome reasonably.

These basic tips to manage money are just a few of the many means to effectively have more resources than just getting break evened with your salaries and allowances.


Lesson 10: Manage Money and Save More

Every day, we are tasked to handle a number of responsibilities and obligations to make sure that each choice that we make and each action that we do would keep us in our normal state of being. From the health to the financial choices presented on a daily basis, we are tasked to make the right and responsible choices lest we want to be in a state of confusion and detrimental scenario. In the financial aspect, we have to manage money and save more in the process. Here are several ways to effectively carry out such task.

Increase the Savings

Easier said than done, increasing the savings would entail us to sacrifice some other type of leisure or free time. In addition, increasing savings would definitely need the added money required to accomplish this, and with a fixed and determined rate of salary for an average worker, some of the allocations for other existential budgeting would have to be compromised.

It does not require one to totally divert all other extra budget to saving as there are also other means to manage money and save more. One is to invest in a productive venture, perhaps a small home business, an online transaction or two, or putting some of the money into stock holdings. Even if this option does not literally mean saving more, you have converted the function of the money from being an expense into a withholding entity capable of bringing in increased inflow of cash to augment and thus be added to the total amount to be allocated for savings.

Lessen Unnecessary Leisure

While leisure and breaks are needed by anyone to retain psychological sanity and empowerment, leisure which requires money to be spent at a constant rate would have to be thought of carefully and with utmost deliberation. If the expenses for such leisure are already compromising the obligation to save, and without contributing to added income, then it should be placed in the least priority of activities. There are many activities which provide fun and relaxation without having to dole out money. Even watching television is already technically a non spending leisure time. Just make sure that the time spent on watching television does not interfere with work or other responsibilities in the home and business.

Turn Idle Time into Productive Fun

Idle time is considered to be doing nothing when there is something else worthwhile to be done and accomplished. In contradiction with leisure, being idle is just having to do nothing and letting time pass without thinking of what things may need to be done at a certain time. Idle time may be turned into productive fun by engaging in a hobby. Though a hobby may require a small amount of money to start with, one may actually use this hobby and turn it into something profitable and caused oriented. For example, instead of just surfing the internet and doing nothing, one may turn it into a means to search for better offers and jobs. In addition to that, the internet may be used as a marketplace to practice some healthy buy and sell practice.

Alternatives Are Alright

The way to manage money and save more may be done with having to choose the appropriate alternatives to save more while still getting the same amount of product or service. There shouldn’t be any problem with having to choose with a less known brand of food product for example, or having to avail of special offers and bonuses because more or less, this only comes in the way of self image and social status practice.

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