Step 01: Draw up a Financial Budget Plan


Yep, so your very first step en route to your financial freedom is to be financially intelligent and to achieve this, you can start by drawing up a budget.  What? … a budget …? Yes, a budget!  The thing that everyone you ask will tell you they have, but do they really have one …?  The answer is usually no.  I usually ask one question in order to find out if someone really has a budget.  How much do you spend on your clothes each month?  Eh .. eish … about … eh.  No direct figure is usually given, why, because they don’t have a budget.  I spend a thousand rand on my clothing accounts per month.  Four accounts, 250 each, irrespective of the amount owing or not owing.  LOL, it used to be 50 bucks per account.  I even have credit with some of these accounts.  How?  Cause i have a budget and i am disciplined.  My budget specifically requires me to spend a 1000 bucks into the accounts, however the specific amount per account depends on the amount owing.

Now back to drawing up the budget, and how better yet, why not use Oprah’s Budget Plan as a guide.  Oprah has made available a basic guideline of a budget.  One that aims to make it easy and simple to draw up your own budget by using her Budget Plan as a guideline.  Thanks Oprah!  The budget plan will help you plan and calculate how much you need and are supposed to spend in an entire month.  Now, i don’t remember where i once heard or read this but the statement says: “if you spend a whole month working very hard for your money why can’t you spend just at least 2hrs per month planning on how you will spend your hard earned cash?”  This statement is very profound coz damn we all work hard for our money.  Question is, is 2hrs per month enough or is it all you can manage for your financial planning?  I will leave you to answer this question for yourself.

Oprah’s Budget Pie – pdf download link

Simple Budget Template – excel download link

Oprah’s Budget Plan places expenses into 5 categories and provides a basic guideline on a healthy monthly spending plan.  Remember, it’s a guide. Your first step is to list all your expenses and place them into the 5 categories.  The beauty of Oprah’s Budget Plan is it also provides a basic guideline on how much you should spend per category in proportion to your salary (percentage).  This in turn will show you where you are over spending or under spending.  Now that you have a budget, what’s the next step?

Simple Budget Template

Next step is implementing your budget.  After getting paid, direct your money towards the budget items (pay and transfer).  Wait until all your debits have finally been processed then finally consolidate your budget.  Did you overspend on some items?  Did you under spend on others?  Did you spend money on items not in your budget?  Did you transfer some funds to your savings account?  Where did my money go?  All these and more are questions that the budget will help answer.

Now, as in any lesson or life experience, there are different levels of expertise of budgeting, namely:

  1. Beginner
  2. Intermediate
  3. Advanced (Mature)

The Beginner – you in the beginning stages, you think budgeting is a hassle and not worth the time.  You tend to forget to budget and still spend recklessly and out of budget items and amounts.

The Intermediate –you begin to understand and notice the benefits of budgeting.  You now dedicate more time to learning more about managing your finances.  You also dedicate more time to your financial planning.

Advanced – you are now a mature budgeter, who is in total control of how you manage and manipulate your finances.  You absolutely cannot live without your budget plan and never distribute any funds without completing your monthly budget plan.

Finally, ADVANCED is the ultimate level that you should aim for.  It will take some time and effort, but it is definitely worth it in the end.  It’s your very first step to the holy grail of financial freedom.  Put in the effort, put in the time.  The benefits will definitely be seen!  Also when in intermediate or advanced levels, you able to look for and find other different budget programs and adjust to them.  So go out and look for other templates which may have more meaning to you or rather represent or speak to your life better!

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