2009 is almost here - are you ready? As you may have read, Bookworm had a hard time following her 2008 budget and asked me how she can redo her budget to help her in this new economy.

You’ve all heard the news - the economy sucks, the job market sucks, businesses are paying their people less money for more work and everyone is supposed to take it because there are no new jobs.

That’s fine - besides going to your boss, you can’t change that. But you can change how it affects your short and long term financial goals. So get a pen and paper ready… it’s time for Step One in budgeting basics for 2009!

Step One: Gather up all your monthly expenses… FOR THE LAST SIX MONTHS.

You NEED to have the last six month’s of expenses in hand before you even start your budget. How can you put together a realistic budget if you don’t know what you’ve been spending?

Six months is a good baseline for your spending. It hits at least one major holiday, two seasons, etc. If you include Christmas into the budget numbers you will always have a little bit left over at the end of every month.

It’s the first step - and it’s daunting. I know that. But you are setting yourself up for a great financial year if you know what to expect.

So go and find all of your expenses for the last six months. Organize them into their categories and line items… so you can have “House” or “Apartment” as your first category and “Water” or “Electric” as one of your line items.
Come back again tomorrow morning and I will have Step Two in my series of Creating a Budget for 2009 AND a very handy budgeting worksheet in Excel ready for you.