(Homesteading.news) These days it is getting harder and harder to make ends meet, and if you’re a homesteader, you understand this perfectly. Between rising costs for feed, seed, building materials, vet visits and so forth, it can be tough to make your monthly budget balance.
That said, balancing your homesteading budget is certainly doable and, in fact, much easier than you think – and you don’t need a “money manager” or a “financial guy” to make it all add up.
First, it’s important to understand the budgeting process and why it is so vital to the success of your homesteading operations:
— Homesteaders will often have increased expenditures during specific seasons, such as when you need to buy seeds and start up equipment in the spring, and buying bulk feed for livestock later in fall;
— Your income is likely not reliable each month; if the majority of your income is derived from the land you must organize it property for budget purposes and for taxes;
— Life happens – and so do unexpected emergencies;
— If you’re new to the homesteading lifestyle, you may not have much of an income right away;
— Equipment and machinery break down and cost money to repair.
A budget will see to it that you’re prepared for these little (and large) inconveniences and emergencies.
So, here are five easy-peasy steps to balancing your homesteading budget, which will not only enable you to cover your expenses, but will also give you the same peace of mind that fits your self-sustaining lifestyle:
1. Gather the facts: The best way to start is to assemble all of your regularly occurring monthly expenses. Add to those your “irregular” bills – those that come quarterly or once or twice a year – as well as annual, seasonal purchases and expenses. This can be tedious but the process will be easier if you collect receipts (and you should).
Now you have a ballpark figure that serves as a basis for your monthly budget.
2. Format your budget design: In order to make the “data entry” easier, choose a spreadsheet on a computer or draw in a chart in a notepad. Some people simply use a Word document or lines on notebook paper.
Organization will help you keep track of what you’ve spent, what you’ll need to spend and will serve as a quick reference in any number of other ways.
3. Add income streams/outflows: Add in all the various income streams coming into your household, as well as all the bills you pay each month, and due dates for both.
4. Required savings: You’ve already figured out what you need to pay each month; now add that amount and divide by 12. That will give you the ballpark budget figure you’ll need to save for each month so you can make the monthly bills.
5. What’s left: Three things will happen – you’ll find that you don’t have enough income, which means you’ll have to 1) find ways to boost your income or 2) find ways to cut expenses; you’ll spend just as much as you take in, which is okay; or you’ll have an amount of money left over after your expenses, which is the best possible outcome, because this money will serve as your reserve fund that you can use for those unexpected expenses. And as a homesteader, you’ll have them.
For those of you who are running your homestead like a business or who really need to carefully keep track of your personal finances, it’s highly recommended you use a program made for that. Some use Mint.com, which works very well for personal finances. Another good program is Quicken. Both will save you time so you have more of it to put into your operations.
[H/T: Off The Grid News]
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