The topic for this article is Personal Finance Budgeting. The first step in becoming financially responsible is starting out with a personal financial budget. Absent a budget there is no way one can possibly track their income and expenses.

Before getting into what personal budgeting finances are I want to explain why budgeting is important. For this idea we will say that you have decide to startup a business, a personal financial advising firm. When establishing your financial advising firm the first thing to be done is the planning out of your company expenses. Most people would logically budget for their expenses before they began because without this financial planning you would have no idea of whether or not your financial advising firm could potentially be profitable. The next thing is to plan out your revenues. Then you would take the difference between the two and see whether things looked good or not.

This is what a financial budget is for a company and people should handle their personal finances in the same manner. When establishing a personal financial budget it is important to include everything that involves your money.

You can find personal finance software on the internet. This software is made so that you can easily enter all your income and expenses and it does everything else for you.

The components in a personal financial budget include both income and expenses. Examples of income in a personal finance budget include job income, gambling winnings, capital gains, social security, tax refund, etc… Examples of expenses in a personal budget worksheet include SAVINGS, electric bill, health insurance, cell phone, groceries, books, shoes, clothes, car insurance, gas, entertainment, travel, miscellaneous, etc.

This expense list does not include all potential expense, I’m sure you can think of others right now. Anything possible thing that you can think of that you might need to spend money on should be put on your personal budgeting worksheet.

I know that some of you are thinking to yourselves “Savings? What? Thats not an expense!” Well I’m here to tell you that savings should indeed be thought of as an expense. Each month one should personally budget for a certain amount of their money to be saved. This should not be an “if I have money left over” situation. It should be definite and as automatic as writing that check for your mortgage every month.

The most basic concept of personal budgeting is to control spending and use your money wisely so that you have money left over rather than having no money or going into debt.

After listing your income and expense on your budget worksheet you need to subtract the expenses from your income and get a Net Cash Flow for the month. The idea is to include all income and costs and come out with a positive cash flow on your personal financial worksheet. If the number comes out negative then you have a problem and your expenses will need to lowered.

Now you know exactly what a budget is and how to make one. The next thing to is run a few Google searches an find a budget template to make things easier.

You need to keep a budget every month. No, you cannot simply make one plan for the whole year and stuff it away somewhere to forget about it. Our income levels change and our expenses change and these changes need to be accounted for.

To be successful with your personal budgeting plan you need to make out a projected personal budgeting plan for the whole year. Then as each month passes you can make monthly adjustments.

The other thing to do is keep a record of your actual income and expenses and compare that to your personal financial budgeting worksheet. You want to make sure that your original estimates were correct or at least close.

The thing about a personal financial budget is that it sets you up for success and helps keep you from needing to use credit cards or other debt to make it.

If you have an accurate personal financial budget then you will be prepared for the unexpected financial burdens that happen from time to time.

There should be no issues when your car breaks down and you suddenly need $300 to fix it. All is good because you have been putting money into savings each month.

This is the most basic idea of personal financial freedom and personal finance budgeting. If you can establish a sufficient level of savings then you can begin to be at ease with your financial situation.

Most people are clueless and don’t realize that their unplanned/unwritten actual personal finance budget includes something like $4500 of income and $4700 of expenses each month.

Next time I will take a short break from the Mini Series and instead suggest a few personal financial budgeting software programs that are available out there.

Retirement is a big issue, what can be called a moment of truth for every employee. Irrespective of the stature or economic position of the employee, retirement would mean a sudden break of a lifestyle that has imbibed into the mind of a person through years of practice. Also retirement would bring some sort of financial constraint and in some cases financial burden. Such problems tend to cause a lack of self-respect. When such issues are coupled with natural old age health problems, life will appear a less attractive entity. People generally will get a large amount of money as retirement benefit. How to spend that money effectively will also be a big question for most people. So once the age crosses the psychologically important landmark of 50, retirement worries are likely to cloud over the minds of most people.

To overcome these problems associated with retirement, many employers have started giving retirement planning training to their employees who are likely to retire in the near future. Some organizations provide in-house retirement planning training. Some others hire external agencies and consultants to provide training to employees on life during and after retirement. Not all companies provide that sort of training though. For employees of such companies, there are plenty of independent institutes and courses that offer retirement planning training.

Many retirement planning courses are a masqueraded form of financial planning. Promoters of such courses are more concerned with the money of the person rather than the life of that person after retirement. So it is better to join an organization, which provides retirement planning training in the first place. If that could not be attained, always conduct a thorough investigation about the retirement planning courses available in the nearby places. Always consult people who have undergone the training in a particular institute before joining. Select a course, which suits your lifestyle and budget. Nowadays, there are online courses, which provide retirement planning training. But experts are of the opinion that training in an institution that provides one-to-one training is a far better option to get a proper understanding of life after retirement.

The course content of retirement training varies from institution to institution. Some institutions claim that they provide personalized training. That means they analyze the nature and environment of a person and structure a retirement planning training course accordingly. Generally a good retirement planning training course will contain subjects such as tips to adjust to a new lifestyle, issues related to health and healthcare, benefits provided by the government, an overview of taxation and mortgages, wills and power of attorney, investment opportunities, issues related to home and environment, and, last not the least, how to manage and spend time usefully and peacefully.

For many baby boomers retirement is around the corner. It is amazing how fast the years have gone by. In 2007 the oldest baby boomers started collecting social security, and in the following eleven years another 77 million are expected to do the same.What About Social Security

Currently there are about 40 million retired people collecting social security. With another 77 million expecting to get their social security payments back with interest, that is going to be a tremendous strain on the system.

Most boomers (and those coming after them) realize that they cannot count on social security being around long enough for them to collect any of the money they paid into it. They are hoping that the government repairs the system, but they cannot depend on that.

Retirement Savings Accounts

For this reason it is very important that baby boomers and those following behind them start saving for retirement as soon as possible. A 25 year old who starts setting as little as $100 aside each month will have about $350,000 saved by retirement age (at 8% interest). In comparison, someone who starts saving at 40 or 50 years of age would need to put in a lot more than $100 a month to have $350,000 by age 67.

It is too late for baby boomers to start saving for retirement at 21, but it is never too late to begin saving. If your company offers a 401k sign up today. If they offer matching contributions, then sign up for the maximum deduction allowed.

A good retirement savings plan for small business owners is a Keough account. This is similar to a 401k. There is a certain amount you can put in each year that is tax deductible.

There are other retirement accounts available, too, such as traditional IRAs and the Roth IRA. The Roth IRA does not allow for tax deductions when you make the contributions, but you do not pay taxes on it when you make withdrawals.

Even if retirement is just a few years away, by starting to save today you will have something to live on. If on your 65th birthday you find that it isn’t enough to retire on, you can always work a few more years to build up the retirement fund some more.

How to Make Your Savings Stretch

Working part-time after you retire is often a good idea. It provides you with something to do that keeps you involved socially and exercises your mind. It will also make your retirement savings last longer.

Another way to make your retirement savings last longer is to start withdrawing from taxable accounts and let the tax-advantaged savings accounts compound for as long as possible.

Basically, baby boomers need to start planning for retirement now by having an IRA, 401k, or Keough (or a combination of these), and by getting out of debt now rather than later. The longer you wait to pay off credit card debt, car loans, and your house, the harder it will be for you to live on a fixed income when you reach retirement age.

There has always been a need for retirement planning and today is certainly no different. There are 401(k)s and many other types of retirement plans that are available to you. You will need to take the time needed to evaluate what your current financial needs are and what you expect the future to hold.

Recent events, such as the rise in energy costs and the ever-skyrocketing health care costs need to be factored in. Although gas prices have been fluctuating lately, I think they are going to go back up, possibly even surpassing the extremes we saw all too recently. These types of events can take a toll on your retirement plan very quickly. Prudent planning begins early and you need a good source of information. Websites like [http://jag-info-resources.com/retirement/] are an excellent resource to go to find answers to the questions you may have.

Did you know that most retirement plans have a ceiling of 10% of your pre-tax wages that you can contribute? While that may sound good when you view it against a 2% inflation rate, you must keep in mind that your planning today is not just for the ideal future, but the future that will be reality for you if things turn out to not be ideal or according to your plans today.

By starting early and contributing the maximum that you can afford, you will have a better chance of being prepared for the unforeseen. This is made much easier today because your 401k plan is now transferable from one employer to another. This allows you to continue to grow your retirement account even when you choose to change jobs or even careers.

Unsure of what you will need for retirement? There are calculators like the one at my site as shown in my author box below that will help you figure it out for yourself. This is a helpful tool that lets you see if you are on track or not. Don’t forget that life expectancy is getting longer. When Social Security was passed in the 1930s people lived about 2 years after retirement. Today you can expect to live 20-30 years past retirement and, suddenly, the amount you need to retire comfortably with a major change in lifestyle gets very large.

Lets say that today you need $40,000 to live on and you retire in 20 years, you will need a minimum of $850,000 to carry you through retirement. That is assuming that you will live an additional 20 years after you retire and are in good health. There is something to be said for debt reduction as being part of your retirement planning, as well, since the last thing you want to do is go into retirement with a ton of debt still hanging over your head.

Having $40,000 a year to live on with little to no debt will obviously go farther than if you still have the same debt load as you do now. If you reduce your debt load by the same amount that you save for retirement, you double your retirement savings.

One cannot have a conversation about retirement without the subject of taxes coming into it. The money you put into your 401(k) is pre-tax so you will pay taxes on it when you get disbursements. The 401(k) is intended for retirement, so there are also very heavy tax penalties if you withdraw any funds before you turn 59.5 years of age. If at all possible, do not make any early withdrawals from your retirement account, since most people have found that in addition to the heavy tax penalties for doing so, the prospect of paying it back, even with good intentions, is tougher than it seems.