A budget allows you to analyze:

• How much money is coming in
• How much money is going out
• How much you can afford for a monthly mortgage payment and other housing expenses

Generally, creating a budget begins with calculating your net income. In addition to net income from your employment, other income that may factor into your budget includes interest from a savings account, cash gifts, tips, bonuses and child support.

• Calculating Your Net Monthly Income
• Simply apply the following formula, depending on how often you are paid:
  • If weekly, multiply your take-home pay (the amount of your paycheck after all deductions) by 52 and divide by 12
  • If bi-weekly, multiply your take-home pay by 26 and divide by 12
  • If semi-monthly, multiply your take-home pay by 24 and divide by 12