Budgeting for Beginners – How to Make a Budget From Scratch 2024

Budgeting allowed me to payoff about 70k in debt, build a 6-figure investment account, and get my spending down to less than $1,000 per month. That’s the power of a good budget.

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1. The Things on a Budget that everyone has
– These are the cost of living that everyone will have
– Unless they live at home with their parents
– Which is okay honestly and its something to take advantage off

First Income:
– How much do you make
– Type of Income
– Time traded for income
– Let’s say I have three sources of Income ( so I don’t get robbed by showing my real numbers )

Office Job:
– Income: $4,000 dollars Per month
– Type Of Income: Active Income, have to trade Time for Money
– Time: 160 hours a month or 40 hours a week

Stocks:
– Income: $500 dollars per month
– Type of Income: Passive
– Capital at work: $75,000 with a 8% return
– Time Savings: 240 hours I don’t have to work

Real-estate Investing
– I have one apartment that I paid $60,000 for
– It makes me 250 dollars a month or $3,000 a year (6% return)
– That’s 120 hours I don’t have to work

Total Income is: $57,000 a Year

Second Expenses:

Shelter Cost:
– $1,500 dollars on mortgage, a home on 15 year mortgage Cost $200,000

Utilities: $500
– Water
– Electricity
– Gas
– Internet
– Phone bill

Food Bill $500
– Cooking at Home
Transportation $300
– Gas
– Insurance
– Maintenance
– No a car payment

Total Expenses: $2,800

2. The custom things you can add
Personal: $300 ( fun, subscriptions, and misc ).
Left Over: $900 in savings

3. The different goals ( Less needs less money less time ( payoff house, no debt, and so on )

Remember Time is Money:
– Because you trade time for money
– So on your budget Let’s run the numbers on a Time basis and see how you can save more time

Shelter: $1,500 ( if I use my $900 left over to dumb into this property )
– I could be done with the property in 7 years
– So instead 60 hours of work on a house
– I would be spending $200 between ( insurance and taxes ) – 8 hours

Food: an option is to grow your own food but that takes a lot of work and a person who may want to homestead and not everyone is down with that
– So this pretty much stays the same

Utilities:
– You can save money by becoming energy efficient but again that can be expensive
– So let’s keep it the same

Transpo:
– Public transport or biking
– But most likely you’ll keep your car

So How to get back those hours from those expenses:
– You get them back by investing more money
– $900 for 7 years got 60 hours each month you don’t have to work
– You keep investing, and then you can make supplemental income to cover those cost
– The goal should be, to get your Passive income to cover your expenses ( so you don’t need to trade time for money )
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*Some of the links and other products that appear on this video are from companies in which Tommy Bryson will earn an affiliate commission or referral bonus. Tommy Bryson is part of an affiliate network and receives compensation for sending traffic to partner sites. The content in this video is accurate as of the posting date. Some of the offers mentioned may no longer be available. I’m an Accountant but I’m not your Accountant, always review information with your Accountant/CPA and your Financial Advisor.

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