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02-19-2008, 01:41 PM
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#1
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#19: Calculate Your Current Cost of Living
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Ms. Mommysavers
Last Online: 06-30-2009 12:49 PM
Join Date: Jul 2006
Location: Southern MN
Real Name: Kim
Posts: 12,429
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Calculate Your Cost of Living
Before you can begin to budget, you need to get a feel for what you spend and what your current expenses are. In this next step, use the financial information you collected in step #18 to get a six-month average of spending to determine your average cost of living. If you don’t have six months of data, do the best with what you have in calculating your averages but try to be as realistic as possible.
For example, this may be what your gift expenditures look like:
Gift Expenditures
August 2007 $0
September 2007 $100
October 2007 $100
November 2007 $50
December 2007 $500
January 2007 $50
TOTAL = $800
AVERAGE: $134/month
Avoid common mistakes like not including everything you spend money on and forgetting about categories that may not be mentioned. If you use a lot of cash, your expenditures may be harder to track. Every household has different and unique expenses. The more accurate you can be with this step, the better picture you’ll get of what your spending actually looks like.
Here is a calculator you can use as a guide:
http://mommysavers.com/family-finances/cost-of-living-calculator.xml
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