| 3:16:07 AM - Sun, Apr 30th 2023 |
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A bare bones budget is a financial strategy that prioritizes essential expenses over non-essential ones. It is designed to help people who are on a tight budget or facing financial difficulties to make ends meet. In this article, we will explore what a bare bones budget is, how to create one, and its benefits.
What is a bare bones budget?
A bare bones budget is a budget that includes only the essential expenses needed to survive. These expenses include things like rent or mortgage payments, utilities, food, transportation, and necessary medical expenses. Non-essential expenses, such as entertainment, dining out, and luxury purchases, are cut from the budget.
The idea behind a bare bones budget is to prioritize essential expenses and cut back on non-essential ones. This strategy can help people who are struggling financially to make ends meet and avoid falling into debt.
Creating a bare bones budget
Creating a bare bones budget is relatively straightforward. Start by making a list of all your essential expenses, such as:
Housing: Rent or mortgage payments, property taxes, and home insurance.
Utilities: Electricity, water, gas, and internet.
Food: Groceries, meals, and snacks.
Transportation: Car payments, gas, and insurance.
Medical expenses: Prescription medications, doctor visits, and health insurance.
Once you have a list of your essential expenses, prioritize them based on their importance. For example, paying rent or mortgage payments should be a top priority, followed by utilities and food.
Next, look for ways to cut back on non-essential expenses. For example, instead of dining out, cook meals at home. Cancel subscriptions that you don't use, such as gym memberships or streaming services. Shop for items on sale and take advantage of coupons and discounts.
Benefits of a bare bones budget
There are several benefits to creating a bare bones budget. First, it can help you avoid falling into debt by prioritizing essential expenses and cutting back on non-essential ones. This strategy can help you make ends meet, even if you have a tight budget.
Second, a bare bones budget can help you build an emergency fund. By prioritizing essential expenses and cutting back on non-essential ones, you can free up more money to save for unexpected expenses.
Finally, a bare bones budget can help you develop good financial habits. By learning to prioritize essential expenses and cut back on non-essential ones, you can develop a mindset of financial discipline that will serve you well in the long term.
Conclusion
A bare bones budget is a financial strategy that prioritizes essential expenses and cuts back on non-essential ones. It is a useful tool for people who are on a tight budget or facing financial difficulties. By prioritizing essential expenses and cutting back on non-essential ones, you can avoid falling into debt, build an emergency fund, and develop good financial habits.
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