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Creating an effective spending plan

Here's an article which I received from an e-mail from my friend, Alvin T. Tabañag, RFP

Have you ever accomplished something important without planning first on how you will do it? I guess not. Even the simple things that you do require some sort of a plan; if you want to eat lunch at the mall you plan where to eat and what time to go, how to get there and decide what to eat.

It’s the same thing with spending your hard-earned money. Without a good plan on how you will use your money, you could end up spending more than you have to. Creating a spending plan ensures that you “spend less than you earn,” which is a major requirement in saving and wealth building. The spending plan, also known as the “budget,” helps you manage your money properly and prevents you from overspending.

These are the steps involved in creating an effective spending plan:

1. Know how much money you earn.
2. Find out where your money goes.
3. Set a reasonable budget for your expenses.
4. Implement the budget and stick to it.
5. Monitor and make adjustments, if necessary.

Read the full guide at