How do you take control?

Well, firstly, you need to look at PERSONAL BUDGETING. After that, you may need to look at WAYS OF SAVING COSTS. If you still do not have enough money to meet all your obligations, you may then need to look for OTHER SOURCES OF INCOME.

Personal budgeting

Many people are too scared to sit down and prepare their own budget, because they are frightened about what it will tell them, just as some people are frightened of medical check-ups. Budgeting sounds complicated, like something that only businesses or very rich people do.It’s simple and very, very important for each and every one of us. Without a proper budget, you don’t really know what is happening with your money, and your problems will probably get worse. If you don’t budget properly you will also not be able to save money.

Follow the five simple steps set out below to prepare your very own budget:


•   Work out your total net income (“Net income” means the amount of money that you take home after all deductions from your gross income have been made). by adding togetheryour salary, that of your husband or wife, and any other income, perhaps from a part-time job or sideline business. Perhaps a friend or relative stays with you and gives you some money towards household expenses. If your children are staying in your home and have part-time jobs you must also include that under income. Only this net amount will be available for you to spend each month.


•   Each month, there are certain payments that you have to make, otherwise serious problems may arise. For example, if you don’t pay your rent, you could be forced to leave your house; if you don’t pay the instalment on your furniture, it could be repossessed; or if you don’t pay back money borrowed you could get a judgement against your name.

•   You should always try to keep these fixed commitments to a minimum. If you have

money problems, you should not take on any more of these types of commitments until things improve.

•   Under “loans”, include the amount, plus interest that you currently owe a micro lender, term loan lender or bank from whom you have borrowed.

•   Don’t forget to take into account payments that you do not make each month – like licences on your car or TV, school books, birthday parties and clothes and so on. You should consider setting aside money each month, in a separate savings account, so that you are in a position to meet these expenses as they arise.


•   There are certain payments that you have to make, but over which you have some control as to how high or low these payments are – unlike those nasty fixed payments! You have to eat and drink but you don’t have to eat expensive meat and drink expensive wine every day. You may need to make telephone calls, but you can take steps to control the number of calls that are made each month. You may also need water and electricity but you can control the usage.

•   You may not know accurately enough what you spend on these types of things. If that is the case, you should keep a detailed daily record for a month or two until you know exactly what it is that you are spending your hard earned money on!

STEP 4 – DISCRETIONARY EXPENDITURE (Non-essential/luxury payments)

•   Discretionary expenditures are those that you like to make but don’t have to. Usually, it is in this area that there are the best opportunities for getting out of problems or for saving some money. Many smokers, for example, would be amazed if they sat down and calculated just how much money they spend on their smoking habit. We all like to dress nicely, but what is the point of having nice clothes and shoes if we haven’t got a home to live in!



A lot of people have negative listings on the credit bureau because they have not followed the personal budget steps set out above. If you plan correctly and pay your creditors on time you will build up a good credit record again. Be sure to follow the budgeting principles set out in this book carefully and your financial situation will definitely improve!