Budget is like a mantra that has been being shouted by money advisors or financial experts. It shows how important to budget your money for your financial security. Having yearly budget template is a good start to manage your income and expenses for a 12-month period.
What Is A Yearly Budget?
Budget is an approximate plan of income and expenses within a specified future period of time. Budget can be as an internal tool used by management at companies and organizations. You will know where your money is going because it’s such a wonderful thing for managing your finances.
What Is Yearly Budget?
To start having a good financial management you need to create a yearly budget template. You have to look at your income and expenditure. And then, calculate how much money you are spending each month. You can look at your expenditure for the year after counting expenditures for month. It shows you how plan will be made throughout the year, And also you will know which part that needs to be improved to reach your financial goals.
Why Do We Need A Yearly Budget?
Creating a budget gives some advantages. Here are some reason why you should create a budget.
You Don’t Spend Money You Don’t Have To
It helps you focus to spend your money on things you really need. It’s a good way to prevent you from wasting money on unnecessary things.
Preparing for Emergencies
When something bad happens in your life and brings hardship to your financial, you will need emergency fund. That’s why you should include emergency fund at least 6 months worth of living expenses.
It Changes Your Habit
If you notice that you are often spending money on things that you don’t need, so building a budget will force you cut off your habit. It will make you think twice of your spending habits and you will be able to focus on your financial goals.
A Happy Retirement
You may not work forever and there will be time to retire. Having a good yearly budget will ensure you future even though you have to sacrifice a little now.
How To Create A Yearly budget
The perfect time to create a yearly budget template is the end of the year or a new year. Keeping track your spending will help you manage your financial well. Here are some steps how to create a yearly budget.
Sum Up Your Income
The very first step of creating a yearly budget is adding up all your income. It includes any kind of income you are receiving in a year such as salary, pensions and remittances
Estimate Your Expenses
Estimating is made by calculating an average significantly changing expenses. And also you have to find the sum of you expected spending by including fixed and flexible expenses.
Calculate The Different
The final step creating yearly budget template is calculating you income and total estimate expenses. Next, you’ll get the different by subtracting the 2 amounts. Now you can see the result of your yearly budget.
Creating a yearly budget tempate is not hard to do because you can download the template for free from the internet. The templates are editable and available in any kind of forms such as word, excel or pdf. It allows you to make a professional yearly budget template.