The Importance of Setting up a Budget

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The Importance of Setting up a Budget

Kingdom Mortgages • Mar 01, 2022

Taking control of your financial future and your present starts with a budget.

Advantages of making a budget

Budgets are a great way to summarise your monthly or annual cash flow. By creating one, you can:

· Avoid falling into debt;

· Avoid the pitfalls of unexpected expenses;

· Improve your credit rating;

· Increase the acceptance rate for mortgage or loan;

· Identify areas with the potential for saving;

· Schedule a holiday or some other significant expenditure better.

How to make a budget

Before you get started on your budget, first find out how much you spend on the following categories:

· Utility bills including heating, lighting and water;

· Living costs such as housing, food, and healthcare;

· Insurance and other financial products;

· Gifts and help to friends and family;

· Transportation and logistics such as vehicle maintenance and taxi far;

· Entertainment expenses such as holidays, sports events and dining out.

Then, see if you’re spending more than what you bring in. If there are multiple earners in the family, sum up everyone’s monthly income. Once you have that covered, you need to work out where you can cut back. Remember, often simple things like taking home-made lunch to work or school could do the trick. You might even cancel a gym membership and go for walks outside instead. You can even save hundreds if not thousands of dollars by reviewing your mortgage. Talk to a mortgage broker or agent to see if you have any alternatives available.

Tips for keeping track of your expenses

Like most businesses, you and your family can close your accounts daily. At the end of the day, get together and analyse what you spent. You could also keep individual spending diaries and note everything you buy in the month. Look at the monthly bank statements to figure out your expense categories for online transactions. Furthermore, try and get everyone involved in keeping the budget. Ideally, all household members should participate and be aware of what the budget contains. You cannot underestimate the unpredictability of life, so review your budget regularly and update at least annually, if not every six months.

Contact me today.

Rodney Schunker | Mortgage Broker (Lic. M12000165)

Cell: 416-697-6423 | Toll Free: 1-855-787-7723

Fax: 1-855-787-7723 | Web: www.kingdommortgages.ca

Mail: 10 George St North, Suite 202, Brampton L6X 1R2

Email: schunkerr@gmail.com

Rock Capital Investments Inc. Brokerage #10556. Each office is independently owned and operated. Proud member of Mortgage Centre Canada.

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