Clear & Simple

Seniors

• Budgeting

  Live Happily Within Your Means

• #8 Question Your Needs and Wants

  What do you want? What do you really need? Evaluate your current financial situation. Take a look at the big picture. Make two lists — one for needs and one for wants. As you make the list, ask yourself:

  • Why do I want it?

  • How would things be different if I had it?

  • What other things would change if I had it? (for better or worse)

  • Which things are truly important to me?

  • Does this match my values?

  • What will I need to live happily and comfortably in my retirement?

  For more on budget building, watch an online video from personal finance expert Jean Chatzky. She offers valuable guidance on how to stop living paycheck to paycheck and to start living on a budget that works.

  Visit www.chase.practicalmoneyskills.com/jean to see Jean.

• #9 Set Guidelines

  We all have different budgets based on our needs and wants. But this chart shows some guidelines on how much should go toward different expenses. It's especially useful as you plan for retirement and living expenses. You may need to make adjustments for a daily latte fix or visits to children living on the other side of the country, but remember to subtract amounts from other areas if you do.

  Remember that your guidelines might change once you retire. You may downsize your house or give up a commute. Visit www.chase.practicalmoneyskills.com for an interactive Retirement Calculator to make sure you have a big enough nest egg to retire comfortably and happily.

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• #10 Get SMART

  Wishful thinking has never made a budget work. You need to set a goal for your budget and stick to it. See ways to make a SMART budget.

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• #11 Add Up Your Income

  To set a monthly budget, you need to know what's coming in. Make sure you include all sources of income such as salaries, interest, retirement accounts, Social Security, pensions, and any other income sources.

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• #12 Estimate Expenses

  The best way to do this is to write down every penny you spend each month. Categorize spending depending on your needs and wants. Use the monthly expense worksheet as a starting point.

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• #13 Figure Out the Difference

  Once you've created your budget, keep records of your actual income and expenses. This keeps you aware of the difference between what you budget and actually spend.

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• #14 Track, Trim and Target

  Once you start tracking, you may be surprised to find you spend $50 a month on coffee or long calls to the grandkids. Some expenses are easily trimmed. Cutting back is usually a better place to start than completely cutting out. Be realistic. It will help you to be better prepared for unexpected costs.

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• Visit www.chase.practicalmoneyskills.com to download a free copy of "My Budget Planner" to help you create and maintain your budget. Or, use the monthly income worksheet and monthly expense worksheet.