Free Budgeting

Written by Sarah Provost
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Free budgeting is there for you when you need it most. When money is tight and you're trying to set up a budget to get control of your spending, the last thing you want to do is pay a financial counselor. Instead, try using the various free budgeting services that can be found online. You can get financial advice, templates for your budget and information about how to make it work, all without any cost to you.

How to Evaluate Free Budgeting Advice

As the saying goes, advice is cheap--in this case, free! But, always be sure you're getting good advice before you jump in headfirst. Any free budgeting service should include the following suggestions. First, it is almost always a good idea to pay down credit card balances, and you should always make more than the minimum payments. Assuming you have enough money in your savings account to cover emergencies (generally two to three months' living expenses), you should use any extra to pay off your credit cards. It doesn't make sense to have money earning a few percent interest in a savings account while you're paying double-digit interest on your debt.

On the other hand, it is not a good idea to withdraw money from IRAs, 401Ks or other retirement accounts, even to pay off credit cards. The money you will lose in fees and taxes will be more than you save in interest. Under some circumstances, it might make sense to consolidate debts with one lower-interest loan or a second mortgage. If you do that, however, be absolutely certain that you will repay the loan before you begin running up debt again.

Free budgeting templates can be extremely useful. Without them, it's easy to overlook entire categories of expenses, or forget about expenses that recur annually or seasonally. In order for any budget to be useful, you have to be certain that you have listed every expense.

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