Analyzing Your Income
Now we are going to match exactly what you have coming in after taxes with
the dollar figure of what you have going out on the space below. Calculate
only the amount you are absolutely certain will continue for at least one more
year. If you loaned someone money and they owe you only three more payments,
do not include that figure. If you are about to retire or be laid off do not include
the few paychecks you have left. Be as realistic as possible when it comes to
money that you can really count on month in and month out.

This final sum represents exactly what amount of money you need to stop spending
in order to get back on your feet financially.

If after doing these last two exercises you discover that more money is going out
than coming in, -- you’re left with two options: to either make more money or
choose to spend less.

Realistic budgeting means making wise choices, not deprivation. To help you
decide how you are going to spend your money more wisely use the chart on the
following page. Continue forward for instructions on how to utilize the upcoming
chart.