Episode Three: Making a Financial Plan
KNOWING YOUR NUMBERS IS THE KEY:
It is very important before you go out and buy a property that you create a budget worksheet on paper or digitally and calculate your monthly income and expenses.
First you calculate your fixed expenses which includes rent or mortgage, credit card payments, insurance, medical expenses, heat, hydro and so on.
Next you prepare your flexible expenses. These tend to fluctuate every month but generally include food, clothing, transportation, household expenses, personal shopping, entertainment, gifts, and so on. Once you add up both the fixed and the flexible monthly expenses you will know what your expenses are per month.
Next you add up your total household take home pay and subtract all the expenses and savings which will give you an idea of your total monthly family budget. These calculations will give you a clearer picture of your financial situation before you embark on house or condo hunting.
The key is to save, save, save and not embark on large credit card debt. Do not put large ticket items such as a car, electronics or appliances on your credit card before buying a home.