To commemorate the Federal Trade Commission’s annual National Consumer Protection Week (March 6 – 12, 2011), the FTC is providing a budget-load of handy-dandy information designed to protect your money, your credit, and your overall post-recessionary financial future. So whether you’re rebuilding your economic life post-bankruptcy, or simply trying to speed up your savings, the NCPW blog can yield a wealth of resources exactly at a time when average Americans need a financial infusion, including information about:
- Avoiding foreclosure rescue and other mortgage-related scams;
- Knowing how to spot employment opportunity scams;
- Making the most of your money in the early stages of your career;
- Building and maintaining a budget to improve financial stability;
- Avoiding time-share and credit-card scams offered via text messages; and
- Learning what steps to take to save your home from foreclosure.
In Parts One and Two of The Best of National Consumer Protection Week we looked at real estate and employment scams. In Part Three we turned from scams to savings, sharing resources for making the most of your money. In Part Four, now that we’ve saved, we can build a budget—all from trusted tips from the FTC, including:
Keeping Track of Monthly Income
Whether we’re talking about take-home pay, monthly commissions from sales, or simply the accumulation of unemployment benefits, it’s never been a better time to take an accounting of income. According to the FTC, it’s important to “List income you receive from any source, like a part-time job, a tax refund, gifts, unemployment, public assistance, dividends, and alimony or child support. Add the entries to determine your actual income for that month.” Be aware that while things can fluctuate from month to month, knowing an average of your income is helpful to understanding what you’re working with in the event of unexpected expenses.
Listing Your Monthly Savings
In addition to keeping track of monthly income, it’s also essential to assess what you’re placing in savings each month from your take-home income. Even if it’s a small amount, it can make a big different when tallied over the course of a year.
Finding Your Fixed Monthly Expenses
Another easy part of budgeting is calculating what the FTC calls “the predictable, set amounts for the must-have items and services that you pay for each month – like rent or mortgage, car payment, and telephone, cable, or Internet access.” As “fixed” expenses you’ll normally see these stay the same from month to month, allowing you to account for them with little effort.
Evaluating the Variable Expenses
Variable expenses can be tougher to assess. For these items—like groceries, clothing, haircuts, gas bills—amounts can change dramatically from week to week, month to month or year to year. As a result, in order to get an accurate accounting, it may be important to average these expenses over a series of months.
Walking Through the “Once-in-a-While” Expenses
What the FTC calls “one-in-a-while” expenses are periodic depletions from your budget for special occasions such as birthday and wedding gifts, or holiday presents, or basic entertainment. Normally these expenses are not only less frequent, but may be the first place to cut when dealing with budgetary woes.
Once you’ve evaluated these five variables in your budget, you’re ready to do some math. As the FTC writes in their “Money Matters” section, “Total your fixed and variable expenses and divide by 12 to get a monthly estimate. If after paying your bills and putting money in savings, you still have funds, you can carry over the balance for the next month or use it for unexpected expenses. If this month’s balance is negative, look for ways to cut back on the variable expenses.”
And remember, if cutting back on “variables” or “once-in-a-whiles” isn’t enough to get you back on track, knowing a qualified bankruptcy attorney may be the first best step to help you regain your power, conquer creditors and face your financial fears, yielding a more secure financial future. The bankruptcy experts at the Law Offices of John T. Orcutt offer a totally FREE debt consultation and now, more than ever, it’s time to take them up on their offer. Just call toll free to 1-888-234-4181, or during the off hours, you can make your own appointment right online at www.billsbills.com. Simply click on the yellow “FREE Consultation Now” button.