Josh On How To Budget
104 views · Published 12 January 2017 · 9:05 · Indexed 28 September 2026
Channel: Life The Basic Manual · 2017 · Education
One of many people’s least-favourite topics is household budgeting. We all know it’s got to be done - but good intentions often don’t translate into reality. Josh has faced this problem, and in this clip, he shares his experience of how to budget. If you’ve never looked at your finances in a systematic way before, the very idea of doing so may feel intimidating. But if you’ve never made a personal budget, don’t despair - Josh outlines some of the simple, straightforward steps you can take to financial manageability. The process begins with creating three different categories to help you think about where your money needs to go. The first of these is fixed expenses. These are the underlying, inescapable, structural costs on which your household is built. Examples of fixed expenses are mortgage payments or rent, property taxes, or your bills for heating and light. Josh suggests that anything with a ‘due date’ is probably a fixed expense. He also cautions that it’s all too easy to miss fixed expenses that are intermittent - that occur once every few months. For him, his car insurance falls into this bracket - and that means he has to factor it in to his overall budget. It’s only due once a year, but he allows for it in his monthly budget, which means when the cost falls due, it doesn’t represent a crisis. The second category the goals category. You might be saving toward a holiday, or want to buy a new TV. Anything you are saving up for in this category is part of your financial goals. Budgeting for your goals means that you can plan ahead for the process, and avoid the impulse to purchases what you want on a credit card. The third category is the flex category. This represents the funds you have left over after the demands of the first two categories are met. You might want a new haircut, or to go to a nice restaurant with friends. These expenses are choices in a way that the first category ‘due date’ expenses aren’t. Where many people get into trouble with their spending is by prioritising the second and third budget sections over the first. So how do you decide how much of your money to put in each of these categories? Create a spreadsheet, in excel or old-school with a pen and paper, and populate your fixed expenses column. Total up the costs. Then take that total and compare it to your net income - what’s left after tax etc. is taken out of your gross income. If you have more than one income coming into your household, use all the information you have to figure out what money is actually coming in. This process allows you to see in stark relief what it takes you live, and how much is left over from your income. Once that’s done, you’re in good shape to look at your second category. What’s left over after your fixed expenses are met, and how do you choose to prioritise the goals you want to achieve financially? Josh suggests that you always pay yourself first, meaning that you meet your commitments to your fixed expenses and your goals before you allow yourself to divert funds to your third category spending. He acknowledges that this can be easier said than done, but the creation of a readily consulted budget allows you to make clear decisions on what you choose to spend, and how you might weather times of hardship - such as the loss of a job. Josh urges us not to be the victims of our circumstances, but to take what responsibility we can for how we cope with the demands of our financial lives. You can do it - and ultimately, you’ll feel stronger and better for doing so. Josh is a person in long-term recovery, and when he first came into recovery, he had to cope the disarray caused by his addiction. He wanted not to repeat past mistakes, and he wanted to create a better future for himself and his family. If you want to know more about Josh’s work as senior vice president of business development and public affairs at Central Recovery, or more about the work of Central Recovery in the communities it serves, please see their website at http://www.centralrecovery.com SUBSCRIBE FOR MORE VIDEOS https://www.youtube.com/c/lifethebasicmanual?sub_confirmation=1 FIND LIFE THE BASIC MANUAL HERE http://lifethebasicmanual.com http://www.facebook.com/lifethebasicmanual http://instagram.com/lifethebasicmanual http://twitter.com/BasicManual
