My Financial Mountain: Planning My Simple Budget | Julio Lara | Skillshare

My Financial Mountain: Planning My Simple Budget

Julio Lara, Simple Steps to a Solid Foundation

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12 Lessons (30m)
    • 1. My Financial Mountain Planning Intro

      1:24
    • 2. My Financial Mountain Planning Budget

      1:30
    • 3. My Financial Mountain Planning Simple Budget

      1:24
    • 4. My Financial Mountain Planning My Simple Budget

      3:57
    • 5. My Financial Mountain Planning Income

      2:04
    • 6. My Financial Mountain Planning Expenses

      2:49
    • 7. My Financial Mountain Planning More Expenses

      3:07
    • 8. My Financial Mountain Planning Last Expense Group

      5:49
    • 9. My Financial Mountain: Create the Budget

      4:55
    • 10. My Financial Mountain Planning Thoughts

      1:33
    • 11. My Financial Mountain Planning Summary

      0:57
    • 12. My Financial Mountain Planning Project

      0:58

About This Class

This course should be a crucial step in your personal finances.... 

The course will guide you on working on your financial planning. More specifically on your personal budget. If you have financial difficulties, if you want to know more about your personal finances, if you want a method to follow and reach financial stability... this course is for you.

It is a very simple course but very powerful.  By creating your personal budget you will be able to get more focus, direction, inspiration and motivation on the financial journey.  You will be able to identify where your money is going and how to allocated based on your needs.

Who is the course for?

The course is designed for anyone that wants to learn more about their finances.  It is general enough so that anyone can jump right in and it is simple enough that there are no prerequisites.

The course IS NOT:

  • It is not an in depth budgeting course.
  • The course is not designed to make you a financial wizard.
  • The course does not go into great details on methods and application.
  • Do not expect that the course will answer all or even most of your financial concerns. 

The purpose of the course is to help you create a SIMPLE personal budget.  More importantly the goal is for it to help you understand the concept so that you can lose the fear of a budget and personalize it.

Join us..... Enroll Now!

Transcripts

1. My Financial Mountain Planning Intro: Hello and welcome to my financial mountain, Siri's. This class will focus on the second stage off the financial room planning and specifically on creating a simple budget. My name is Julia, your guide through this course. So what's this course all about? The course tries to go in detail on one of the main steps on our financial journey. The course is designed to help you solidify your finances by helping you plan more specifically how to create a simple budget. The goal is to have you understanding simple budget and to create one. By the end of the course, the course is designed for anyone who's looking for financial stability. You could be a novice foreign expert in finance, and chances are that you can get something out of the class. I don't think that if you're an accountant or a financial wizard, you might get as much out of the course as someone who's is. Starting as the goal is for the courts to be very simple. I'm very basic, like everything in life. You get back what you put into it, therefore, them or effort that you put into the course, the more you'll be getting out of it. So let's get into 2. My Financial Mountain Planning Budget: So one of the most important but most underrated part of our lives and financial foundation is planning, without proper planning, were moving around without a destination. We just go through the motions of things, but without any desire to accomplish them. A key part of planning is that it allows us to control our path, our goals and our future. With proper planning, we can foresee a lot of things that can prevent many major setbacks on this training. I want to cover what could possibly be considered one of the most important, but at the same time, under used financial planning tool. And that is budgeting. Now, before you close the training, please give me a chance to walk you through the simple budget and how it can help you plan and solidify your finances. We normally have negative ideas of budgets because we see them us restrictive or preventive , but I urge you to change your mind. Set your paradigm and perspective on budgets. A budget is nothing more than a tool that you can use to achieve your goals. It can be a simple issue wanted to be, or it could be as complex as he wanted to be. But from now one look at it budget us a blueprint to your financial success with a good budget. You tell your money where you want it to go, how you want to spend it instead of it being Thea other way around. 3. My Financial Mountain Planning Simple Budget: The best way to get financial security is to have a strong or realistic budget with a realistic budget. You can have more money to plan that vacation that you always wanted for by that big screen TV with surround sound that you always dreamed off putting order for you to achieve these goals without destroying your finances. We're going big into that. You need to have a budget. Now remember, it's not as bad as it sounds. It could actually be pretty simple, and I wanted to show you just formula, the simple formula for a budget and that is income and expenses. That's all the budget. It's about your income and your expenses. And the formula is basically your income, which is whatever you're bringing in, whatever you're earning, minus your expenses, and that's going to give you your neck. So whatever you bring in, minus whatever you are actually spending your money and is going to give you the net and your Net could be positive if you have more income than expenses or it could be negative if you have more expenses than income. Obviously your goal is to have a positive net or to have more income than expenses. And we will go through the steps for you to actually create that simple budget so you could planet and you can actually see for your money is going. 4. My Financial Mountain Planning My Simple Budget: let's start defining or creating our simple budget. And as we go through it, I'm gonna be throwing out terms. There are financially related, obviously, but I'll define them for you in a way that you could understand, and you could hear it out in the world and and know exactly what they're talking about. So the first step in creating our simple budget is to know how much we make. How much is our income incumbents the amount of money that we actually produce. So the main part of a budget is based on how much money we make our income. Even if you make low amount or your income a slow within what you think or you would like, you can still budget successfully. What is very important for you to know exactly what you have, so you know what you have to work with, and you could create a solid. But so again, the first step is understanding income. And what is the amount of money that you bring into your house or into the table? As they might say now, there are two types off income that I would like to discuss. There's net income and there's gross income for the purpose of simple budgeting, I recommend that we use net income. Now. You might say what is net income? So net income is defined as the amount of money that you have left over after your deductions, such as taxes. So security benefits is basically the amount of money that you're bringing into your house after the deductions are done, were asked. Your gross income is the amount that you make before all your deductions. So, for example, you might have a salary off $50,000 a year, and that is your gross income. But that is not the amount of money that you are actually bringing into your house, because after your tax and deductions, you might only be bringing home 30,000. So when we do the budget, it's important for us to use our net income, which is the amount after our deductions, just to keep it simple. Ideally, you want to be able to consider your deductions as well as taxes for the purpose off, making your budget at lot tighter and being more financially fit. But for the purpose of this class, we just want to understand a simple budget for the purpose of the class. We just want you to stick to a budget. So for that reason, when we use net income to start with and after you become an expert with budgeting, then you could branch out into being more specific and trying to get more out of your deductions as well. So again, for the purpose of this course of this class will be using net income as our income and net income again is the amount of money that you're bringing into the table bringing home after your deductions. Now, if you have a variable paycheck like if you're working sales or if you work on commissions , using a close estimate should be good for the most part, so you can be realistic by using an estimate off about 3 to 6 months and then divided by the income that you receive in that time frame. So if you work in sales or commission based, you might not have a fixed income, so it might become a little more difficult for you to understand what your net income would be. So in a case like that, on what I would recommend, the one is doing an average of your last 3 to 6 months for even your last year. If you have those numbers available that way, it will become a lot easier for you to do the budget again. The purpose off the course is for you to have a simple budget for you to start with the idea off a budget and then you could branch out from that perspective. 5. My Financial Mountain Planning Income: So instead of meat is talking about it talking about a simple budget. Let's just get to it. Let's start working on our simple budget again. The main purpose of the course simple body it is for you have the concept off what a simple budget is, and you can personalize it and create a simple budget that its applicability to your situation in your life. But again, I want you to I know what a simple budget is and how simple it is for you to actually start creating around. But let's get some practical parts into it in reference to its actually creating one. So grab a piece of paper and you will see in mind I actually did it and excel and you could have Excel spreadsheet so you could have templates that would actually have budgets for you and make it a lot easier. But because of the simplicity off what it budget is, especially for this course, I just want you to know the most basic level off a budget so that you could create your own . So grab a piece of paper right budget on the top of it. So you know what? You're working on and draw a vertical line from the top to the bottom right in the middle. Or you could describe a piece of paper and folded in half. Whatever. It's easier for you and on your left inside. I want you to write income. So again, the only steps that we've had is grab a piece of paper, right budget under paper somewhere. So you know that it is your budget. Draw a vertical line from the top to the bottom, right in the middle, and then right income on the left side. So if you do that, you could have something that looks similar to to this. So you have a budget income and then your line down the center, and that's gonna be our start off our simple budget for our personal budget. So I'll give you some time to work on that 6. My Financial Mountain Planning Expenses: way have the income part of our budget done for written down? Let's start focusing on the other part of formula, which is expenses now this liquid it with income. We had some words that we defined in expenses. We have same thing. We have different terms that we use. We'll refer to expenses. So what are your expenses? Expenses are things were your money of categories where your money is going? What are you spending your money in? Those are expenses now. Your expenses could be classified as either fixed variable for non essentials, and that is just for the purpose of this course. But you would you would hear fixed expenses variable expenses out in the world, and I would like to add non essentials 12 budget so there's no way around it. We all have bills to pay. Some bills ferry from month to month, which are called variable expenses. But there are others dark, constant or those who called fixed expenses. So many loans air structures so that you pay the same amount every month. For example, your car payment for home payment. So those are considered fixed expenses. So again, fixed expenses at those expenses that you never came from a month to month. It's usually the same a month, hence the word fixed so they are fixed from a month to month. Respect your rent for your house. Mortgage rent for any item that you might have as well as cable bills are also some examples or things are or expenses there usually fixed So some other examples off common fixed expenses again are your mortgage or rent your car payments, your car insurance, property taxes, health insurance, home insurance loans that you might have Dora fixed lines of credit Dara fixed. So those are just a few to Jackie memory or to help you brainstorm on what kind of fixed expenses you have. So what I would like you to do now in reference to take action is grab a piece of paper, and this might be the back off the paper that we already started our simple budget or it could be a completely separate piece of paper and all want you to do is go through your monthly expenses and write down which ones are fixed. So in a piece of paper, just write down every single fix expense that you have on a monthly basis. 7. My Financial Mountain Planning More Expenses: So now that we know what fixed expenses are, this look good variable, so variable expenses of those that are not the same from a month to a month. Well, they might not be the same for month to month. This is where making a budget could get a little tricky, because not every bills the same every month. You don't always play in the same amount of money at the grocery store or on gas. These expenses very due to many factors. Sometimes you can't control them, such as the price of gas or inflation. Other times you can. It's easy for the fix expense to be calculated and put into your budget, because again they are the same month to month. But with it bearable expense, you have more room for error if you do not calculate appropriately or you don't budget appropriately. So what I normally recommend for, at least for the simple budget on our viable is to use an average amount off each of the variable expense on our budget. So, for example, if you spend $100 a month on food for the last three months, then use $100 for your budget. If you use you know, if you spend 101 month, 200 the next and then 300. The next used the average of those three numbers to give you a a starting point on your budget, and obviously you'll be able to adjust. That asks, You go through a month to month. The good thing about variable expenses is that for the most part, one way or another, you can affect them. You can change them. For the most part again. We talked about the price of gasoline or inflation. You cannot really affect those, but for the most part, viable expenses can be adjusted with some behavior for some planning or work from your part . So as you will see, reducing reducing the variable expenses is a great way for you to keep more of your heart. Their money. So what are some example off fireable expenses Car maintenance, gasoline for your car, gas for your home food. Electricity could be in a variable expense as well as heating, just to mention a few. You have other expenses, a swell, and everyone would have some personalization within their budget for viable expenses. So let's take action. Take a few minutes on the same piece of paper that you wrote down on your fixed expenses, right, All of your variable expenses and then total that result so again on the piece of paper where you wrote your fixed expenses, go ahead and write all your variable expenses just to recap your fixed expenses and those that do not change from a month to a month. Your variable expenses of those that do change or could change from Montana. 8. My Financial Mountain Planning Last Expense Group: Let's look at the final part off our expenses for at least four hours. Simple budget, Non essential expenses. Now you might say What are non essential expenses? There will always be things that we want, but not necessarily need these types of purchases fitting to the non essential expenses. So, in other words, those air, the things that we do not need to survive but we might want. So the difficult part here is that we normally confused what we want with who we need. So a good test for budgeting purposes is a test of will power. Could be if the expenses over $50. This is an example we will need to ask ourselves. Is this a want or is it a need? Is it something that I truly need to survive to live? Or is it something that I just want? Because I would like to have it? That's just a quick test that you could do for willpower. Come, just ask yourself if it's over a certain amount. Do I really need it for Do I want? If you can't answer the question honestly, didn't give yourself 24 hours to think about it before you make the decision off for twisting or spending in that item or in that thing for service. Also remember that at as you were dealing with your family's budget, it is essential that any financial decision is communicated between the parties that will be affected by the decision in the household. In other words, if you are going to make a purchase, you're going to spend money on a service or product. It is important that you communicate that with your spouse or significant others just to make sure that communication it's open and that everyone knows what is going on. With finances in the household now again back to non essential expenses, non essential expenses are those expenses that are not particularly needed to survive or to live. So some examples off non essential expenses could be an excessive amount off clothing or shoes, and the recent way, say, excessive amounts because we need clothing. And when you choose to be ableto live, we need crawling to be a lot of work to go to school, so on so forth, but an excessive amount of buying more than what you would actually need. Another example. Non essentials might be expending in entertainment video games, eating out excessive gift purchases, things you buy because their own sale rather than because you need him. So those are just some examples obviously, might not have any of those who might have all over you might have a completely different list, but those an example off nine essentials that would fall into your budget. And you might ask, Why do we have all these categories in expenses and the recent run we have on because he could simply have a budget where you use have income expenses and then your net. But the recent what we like to split up your expenses and to fix variable on non essential is because your gold, with their budget, is to know where your money is going so that you could control it better. So the more specific that you are as to where your money is actually going, the easier it would be for you to make changes. For example, if you know that you have a particular amount going into your fixed expenses, such as your rent, there's not gonna be too much that you could do with that in reference to reducing it versus if you notice that your non essentials are out of whack, where you could actually reduce those a lot easier. So just like we did with the fixed and variable expenses on same piece of paper, just write down what you consider your non essentials. They you normally spend money. Now, don't create a category just to create it if you don't have non essentials and don't add it . But if you have non essentials and you know that you spend money in them again, this is similar to parable where you want to estimate or you want to create an average off your prior months so you could be a little more accurate. So you should have by the end off this for have you fixed expenses in reference to the list categories, your variable expenses and now just add your non essential expenses. Remember, there isn't any sacrifice that you will make today that will not yield great results tomorrow. So any sacrifices you make today, it's gonna yield some great results for you tomorrow. So right down all of your fixed expenses, your variable expenses and your non essential expenses, and add them up so that you could get a total what you monthly expenses are. This total will be your base expenditure for the month. So again, the total of you fixed your viable and your non essentials should all total your expenses for the month and rule. Look at how that should look in a second. 9. My Financial Mountain: Create the Budget: So let's continue working on our actual simple budget. It's on the piece of paper that we had before where we have be title budget. When we had the vertical line in this center wrote income on the left hand side. So now let's right. Expense on the right hand side and underneath expenses, we're going to fill in all of the expense categories that we have. So we have the fixed expenses, the variable expenses and the non essentials. And we wanted transpose a We want to transfer. We wanted right in. I love the expenses that we wrote for now a sheet that we have on a monthly basis. So now on the left hand side again, we're gonna have income and everything related to what we make every month. And then on the right hand side, we're gonna have expenses, fixed expenses, variable expenses and a non essentials when we want to add those up so that we could get an idea of exactly how much we're bringing in total and how much we're spending for sending out. And then the difference between the two it's going to be our net. So again, right down on the piece of paper justice from the beginning to the end, right down on a piece of paper budget on the top, on your left, Inside off. She you're gonna have income from the right hand side. You're gonna have expenses. You going to sum up full, fold your income on one side all of your expense on the other. You're going to subtract it, too. And that's gonna be your net. And this is how it should look on again. Yours will be in paper. Could be simple. It could be more complex if you use a spreadsheet. But this is the main idea. So you have a budget in the center from the left. Inside, you have your income. It will be a salary in the extra income. So on, so forth. Then you total that side. And for example, in this case, we have 5000 salary, 1000 extra income. My total is 6000 mental might. Right inside I have my expenses. I have my fix expenses, which would be my rent, car insurance, fireable expenses, food, gas, nine essentials and a team and gift. I summon up Adam. All of he comes up for 3100 again just for this example and in the difference between my total income on my total expense is my net, which in this case will be 6000 minus 3100 gives me a different off 2900. And again, that's a positive income. In this case of positive minutes. Again, this is all just a simple example. Yours will look anything like it because they have different categories. You have different amounts. You have different needs and wants than what this example is. What I wanted you to grasp out of this exercise is basically how simple a budget could be. And it could be even simpler than that. If you have just income and expenses, but you want to be comprehensive, you want to be specific. You want to be as comprehensive as possible because that would make it easier for you to actually know where exactly your money is going. Where exactly are the opportunities for you to cut down on or opportunities for you to increase for example, income in certain ways. So again, you want to be comprehensive, and what I'm gonna do is I'm gonna add a list off possible budget categories just to give you ideas in the project section. So at the end of the course under the project section, you're going to see it list off attachment of budget categories. I also put in a link to some templates spreadsheet temples, and you could use those. They already have budgets created with formulas. Don't the addition subtraction such for you, but I want you to make sure that you understand the concept. So that way, those tools will become a lot easier for you. And you would understand what the tools are actually doing. So again, this is a simple budget. The main purpose of it is just so you could concept get a concept of what it is I'm going to put into private section in attachment that would have some budget categories for you. And also I'm gonna put in length to certain templates that you could use if you want to, or you can create room, or you could just do the simple way and gets write it down 10. My Financial Mountain Planning Thoughts: some budget thoughts. The only way to maintain a workable budget is to follow this one simple rule. Learn more than you spent, and that is what in popular terms is considered living within your means. Now, obviously, your goal is to earn a lot more than what you spend. But if the numbers air close, that's okay. Don't despair. That is the purpose of this exercise. You can still work with it when your goal will be to widen the gap between where you make when you spend to help you fund for your long term goals and to solidify your family's finances. The Cuba Simple budget is just that. For it to be simple, the simpler the better because it will give you a quick view over your current situation and a quick glance at areas to improve on. Also, if it's simple, will be something that you actually are more likely to stick to. If you're in the negative, where you spending a lot more than what you earn, Don't despair. Don't worry. The purpose of the entire course is to get you back on track and give you the ways of improving your family's finances. Please make sure to go back and review the training and go into the areas that you think that you need to work on the most, complete the budget and look at areas off opportunities. 11. My Financial Mountain Planning Summary: So let's go through a quick recap. Why should we plan? If we operate without a plan, it's gonna be like moving without direction without purpose. What is a budget? A budget could be considered one of the strongest financial tools that you could use. It's really a financial plan. It gives us the opportunity to tell our money where we wanted to go instead of the money telling us where it's gone. And finally, how can we budget for How can a budget help me? And the budget helps us by providing guidance, structure and direction. Remember, the key is for your budget to be simple, something that you could stick to something that you could understand easily, something that you could work on. 12. My Financial Mountain Planning Project: So two final things. One is your project. So what is your project you project? It's very simple, as the course is simple budget. So it's just toe work when you're simple, but you could post a sample of your budget for the class to look at or any idea that you might have on a budget any question that you might have on the budgeting process as well. Again, your project mainly is for you to work on the budget and to post a sample off your budget. I also wanted to take this time to thank you for your time, for their dedication, for wanting to better yourself. Stay tuned. We're gonna have additional courses that will come out through mind. Financial Mountain Siri's than the goal of this course is to help you get closer and closer to your financial goals again. Thank you very much and