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Project Summary

There are three components in a budget – fixed, variable and discretionary. Fixed components include mortgage payments, vehicle finance, insurance policy payments, tax payments, other monthly payments and educational fees etc. The funds allocated to them will not change often and so a fixed amount from the monthly salary should be allocated to this component.

Variable budget management components include telephone, electricity, clothing and house hold costs. This component keeps changing depending upon usage of household items and the total number of family members. Funds for this component need to be allocated based on experiences and intuition. The last component is the discretionary budgeting, where expenses are inevitable, due to health problems, annual holidays etc. It is advisable to plan for this kind of spending by allocating a small amount of the salary to a separate savings account.

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budgetmanagement

In a Nutshell, managingyourbudget...

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