Posts Tagged ‘Budgeting’
The concept of zero based budgeting was introduced in 1960. The concept was initially used for some government and business organizations and more recently has increased attention. Zero based budgeting is a budget-planning procedure for the reevaluation of an organization’s program and expenditures. It requires each manager to justify the entire budget request in detail and places the burden of proof on the manager to justify why authorization to spend any money at all should be granted. It starts with the assumption that zero will be spent on each activity-thus the term “zero base”. What a manager is already spending is not accepted as starting point. Managers are asked to prepare for each activity or operation under their control a “decision package” that includes an analysis of cost, purpose alternative course of action, measure of performance, sequences of not performing the activity, and benefits. The zero based budgeting approach asserts that in building the budget from zero, two types of alternative should be considered by managers:
(1) different ways of performing the same activity and
(2) different levels of effort in performing the activity. Success in implementing zero based budgeting requires linkage of zero based budgeting to the long range planning process, sustained support and commitment from executive management, innovation among the managers who makeup the budget decision packages, sale of the procedure to people must perform the work necessary to keep the concept vigorous. Sound budgeting procedure should always require a careful evaluation of all operating facts each time the budget is prepared. There fore the zero based budgeting procedure is new and unique mainly in approach rather than in basic planning and control philosophy.
The healthcare situation in this country would be hilarious if it wasn’t so pathetic and sad. Every day millions of families have to choose between having coverage and not having coverage because the rates continue to go up just for decent health care. If anyone can afford a decent package they have to also consider other problems like rate increase, prescription drugs that have high deductibles and much more. Many people chose to take a job that pays less just because they offer better health benefits than another job. To have good coverage for an entire family a person may have to spend close to ,000 a month.
Coverage should not be based on how much money a person can make. Health care companies can charge what they want while the average person has to make the tough decision on whether to have coverage. There are signs of improvement however, companies have offered small packages with basic plans, and government assistance is improving as well.
If you do your home work you can look at each package from different companies and try to make the best decision possible. The best package may not always be the most expensive and you also have to take into account what type of insurance your doctor will take. Finding a good price is a key to monthly budgeting and making sure you can afford to pay your monthly expenses.
Along with these decisions you should also take the time to check on your credit score. Budgeting on things like health insurance and making sure you have a good score can help save you hundreds of dollars each month, that kind of savings adds up over the course of a year. If you have a poor score you can look into credit repair companies. Credit repair is an affordable and fast process that fixes your score in a matter of weeks.
The holiday season can be dangerous. It is really tempting to go crazy and buy your family what their hearts desire, on your credit cards. It’s also easy to get drawn into sales promotions at the mall being offered free gifts and discounts in exchange for applying for credit or tempting no interest financing deals. You may be thinking “I can finally afford to buy my husband that 40″ flat screen TV.”
Get a hold of yourself!
Don’t apply for credit in exchange for dollar store freebies and 15% discounts. If you use those cards you will face 20%-30% interest rates if you can’t pay your balance in full. Don’t shop with borrowed money!
No interest finance offers are limited time offers and once the 3, 6 or 12 months have passed and you cannot pay the balance in full, you will face really high interest rates! These are particularly dangerous because no payment/no interest offers make it really easy to spend way more than you originally planned and in electronic store, this spending could get up into the thousands.
You don’t know what the future holds, don’t shop with borrowed money.
You may be thinking that this year has been tough and you are going to have to dip into credit to pull it together. If you absolutely have to shop with borrowed money, here is how you should do it.
Use your lowest interest, major credit card. This will be better interest and because you are using your credit card, you can go to any store and have more buying/negotiating power.
Make a list of all the gifts you plan to buy.
Research the best bargains available.
Create a table and organize the gifts from lowest price to highest price.
Go down the list and highlight all the cheaper items that you can pay for in cash. When you go to the mall to buy these items bring your list, your cash, do not bring your credit card and do not stop and talk with sales people in the stores. You have one purpose and one purpose only to be there.
Now you have refined your list so that only the top 3-4 most expensive things will go on credit. Try to get them all in one place. If it’s not possible, go directly to the stores, purchase only the listed items and leave. Do not pass go, do not collect I mean spend 0.
Do you have trouble budgeting? For most the answer is yes. Budgeting doesn’t have to cause headaches. Budgeting can be easy using YNAB.
What is YNAB?
YNAB is software used to create and follow a budget. YNAB makes it easy to set limits for budgeting categories and track how you are doing.
The goal is to stop living paycheck to paycheck. This is accomplished by creating a one month buffer. The one month buffer is equivalent to how much you make in one month. The buffer is used to budget for the current month. For example if the current month were June, you would be budgeting and spending money you made in May. Don’t worry if you don’t have enough money saved up for your buffer. YNAB will show you how to create it.
After you have your buffer created you will no longer be surprised when unexpected expenses such as car trouble or medical expenses arise.
You can now roll with the punches. You are no longer limited by one months worth of pay. Go ahead and dip into your reserve buffer. YNAB will adjust your next months budget by deducting whatever you borrowed for the unexpected expense. So if you are twenty dollars over buget in May, then you will have twenty less dollars to use for budgeting in June.
YNAB Basics
Are you over your budget? Are you under your budget? With YNAB you will quickly be able to tell.
When you start the software you create budgeting categories or use the defaults. You can use basic categories such as Debt Reduction, or break it down with subcategories such as “Debt Reduction:Credit Cards” and “Debt Reduction:Car Loan”.
Next, record your transactions in the register.
Enter these transactions manually or download them in Microsoft Money or Quicken format from your bank. You will then assign a budgeting category to each transaction in your register.
The budget screen shows your financial information for the current month using three columns; Budgeted, Spent and Balance. The “Budgeted” column will be filled in manually by you. As you enter an amount for each category it will be deducted from that months money available. The second column “Spent”, will be filled in automatically as you assign categories to each transaction in your register. The last column “Balance” will show you how much under or over you are for that budget category.
Christmas comes only once a year, thus, it is a very special day. It is a day of giving, and one of the ways people have celebrated this is by giving presents. While giving specific presents is one way of going about it, some people opt to giving hampers instead. Hampers come in lots of varieties and is a gift option for a single person or many. Either way, you would want to still be able to gift under budget without feeling guilty of the quality of the hamper.
One way of saving up on buying hampers without compromising its quality is to buy them during non-seasonal periods. You do not need to buy them only during Christmas itself, as the prices would definitely hike as more people are willing to buy hampers then. Place your order before the rates changes and you would find yourself a good deal. On the other hand, if you are planning to make your own hamper, you can buy the gifts while they are on discount and wrap them up nicely to make a hamper.
Another thing to do is to look out for hamper promotions at anytime of the year. You may get promotional packages that could save you the price of one entire hamper on its own. If you come across hamper vouchers, get them and make use of them. Hamper vouchers usually have expiry dates on them, so that means you will need to use them by a certain time. Even if you get them early, you could always put them aside nicely at a corner in your house so that its condition will stay brand new.
From smaller independent shops that sell hampers, you could try bargaining, especially if you are buying a number of them. The more business they get, the happier they would be. Try to bargain your way through, even if it is just a couple of bucks. Your objective is to save up.