| Q: | How are credit card charges recorded?
|
| A: | A big weakness in most people's financial planning system is that they have no way to keep track of their credit card charges - other than a monthly shock received from the credit card statement. Credit card transactions should be immediately recorded in your check register just as you do with checks and cash transactions - but this is impractical with a normal check register.
The BudgetMap system allows you two different ways to keep track of your finances as you make each credit card transaction. The best way is to have one of columns C1 to C12 set up as a "credit card" column. For each credit card transaction, money is set aside in the "credit card" column until it is paid to the credit card company (See Example 5-1 on page 34 of the workbook for details).
A second way is to treat a credit card transaction as an outstanding check until it is paid (See "Credit Card Transactions" on page 17 of the workbook).
|
| Q: | How are cash transactions recorded?
|
| A: | When cash is withdrawn from your account for a specific purpose, subtract it from the related budget category (or categories) in the BudgetMap register. Example: If you withdraw $20 and intend to spend it on gas, subtract the amount from the "Car expense" column.
If you just want to have cash "to spend" - cash for no specific purpose - the amount taken out should not exceed the amount budgeted for "miscellaneous" spending. Carrying extra cash for no specific purpose tends to burn a hole in your pocket if no guidelines are set.
|
| Q: | I want to keep track of more categories than there are columns in my BudgetMap register. What should I do?
|
| A: | First, try to simplify your financial plan to make it work with only one BudgetMap register. Combine similar types of categories together into one column with a more general heading. For example, instead of having a separate column for "Electricity" and another for "Water," combine them into one column using the heading "Utilities."
Remember that in each BudgetMap register, there is a checking register at the front and a saving register at the back. Each has twelve columns so there are a total of 24 columns. This is usually enough columns for the average individual. Use the savings register for special events such as vacation, Christmas, taxes, birthdays, life insurance, and other categories that you only use several times a year.
If you still do not have enough room, see "Using Two Registers" on page 21 in the workbook. Your budget or financial plan is probably getting too complicated if you need more than this.
|
| Q: | Every month, I end up being under in some categories and a little overspent in other categories according to my personal financial plan. What do I do about these differences?
|
| A: | First, it is okay to make adjustments as long as you meet your overall budgeting goals. The BudgetMap system allows you to easily make adjustments from one column to another by subtracting in the column(s) where there is an excess and adding the same amount back to the column(s) where there is a shortage. See "Adjustments Between Columns" on page 17 in the workbook.
Second, you should review your financial plan to see if it needs to be changed. Such adjustments are necessary and should be done periodically. A new financial plan may need to be adjusted every month for the first and second years it is in use. After this, it will still be necessary to periodically review and adjust your financial plan, but not as often.
|
| Q: | How do you record a check made for a purchase that includes more than one type of expense (e.g. you buy food and an entertainment item together at the supermarket)?
|
| A: | On the left-hand side of the BudgetMap register, record (subtract) the total amount of the check in the balance column of the check register like you normally would. Then, on the right-hand side, subtract the amount for each type of purchase from the appropriate columns. Example: Peter has a column for "Food" and another for "Entertainment" in his BudgetMap register. At the supermarket he purchases $15 worth of entertainment items and $25 worth of food. He pays with one check for $40. To record the transaction, Peter subtracts the total of the check ($40) from the balance of his checking account (column B on the left side). Then, on the same line, but in the columns on the right side, he subtracts $15 in the "Entertainment" column and goes over and also subtracts $25 under the "Food" column.
|
| Q: | My husband and I often need to use our check register at the same time when we are apart. Should we use two check registers (his and hers) for the same account?
|
| A: | It is simpler to use just one check register for each bank account, but sometimes it is necessary to use two registers at the same time. See page 21 in the workbook concerning how to use two registers at the same time.
|
| Q: | I already use a computer to track my finances. Can a BudgetMap register help me?
|
| A: | A computer is great for accumulating and recording data but often the information provided doesn't help you know until the end of the month, after you look over your computer information, that you have blown your budget! You need something practical that will help you know, as you make each transaction, whether or not it fits into your financial plan. The BudgetMap register gives you a simple way to have that information handy at all times.
A BudgetMap register can also be especially helpful to married couples who record their finances on the computer. Typically, in such a situation, one of the spouses has the primary responsibility for keeping track of the finances. The spouse that does not have this responsibility usually does not know as much about the finances as the spouse who is the "computer whiz." By providing a BudgetMap register to the "uninformed" spouse, that spouse can then control his or her spending and make transactions according to the family's overall financial plan.
|
Contact
