Prajna Capital - An Investment Guide

Though maintaining an expense sheet and budgeting looks mundane, it is a very critical step in personal money management and can help reduce worries in an uncertain economic scenario. The main objectives of maintaining a budget sheet is to track and control the day to day expenses, to provide and prepare for the priority needs and to create financial backups to counter any unforeseen needs. Ideally one should do this exercise for at least 6 months if not more which will definitely give a lot of food for thought. The budgeting process has two main steps. First, preparation and maintenance of an expense sheet, and second, deriving a cash-flow statement. The simplest way to do this is to create a template on Excel and regularly update the same. Steps to create a budget sheet Define the basic heads of expense and list all the expenses under each head Committed expenses: Includes expenses, which are a must and are recurring in nature. Rentals, groceries, school fees, telephones, fue...