Budgeting for life insurance?

Often overlooked in today’s world but budgeting income and expenses to keep track of your financial goals, may help you uncover valuable savings along with the need for life insurance.

Financial goals are important because they allow you to be in control of your finances. A financial planner can help you find and gather the information needed to create financial statements. 

A financial goal can be as simple as having enough cash for a life insurance premium or more complex such as retiring comfortably. Defining your financial goals provide a structure in order to make calculated financial decisions.

Financial planning can be useful in helping you reach your financial goals. One way is to examine your income and compare it to the amount of expenses for a given past period of time. The resulting income statement helps bring to light the practical information needed to move towards your financial goals.

Income statements are generally created to cover past periods of time ranging from a month to a year. Some common sources for income include, wages, salary, disability insurance payments, investment and retirement income, alimony, pension and annuity, and real estate income.

Expenses are made up of things that include housing payments, vehicle, groceries, clothing, child care, entertainment and health related expenditures. Expenses can be refined into two categories called fixed and variable expenses. Fixed expenses are the same every month and include things like the mortgage payment or car payment. Variable expenses fluctuated from month to month and include things like dinning out, entertainment and household items like kitchen ware.

Now you can create a budget, which is a plan to reach your financial goals. A budget is a simply a financial statement that forecasts income and expenses for a future period of time.



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