| The first question I ask of any business owner is, | | | | employer automatically deducts from your paycheck) |
| "What is your overhead cost?" Most business owners | | | | - Mortgage Insurance (PMI-Private Mortgage |
| know this answer. If you ask anyone off the street | | | | Insurance) |
| about his or her household overhead, I would receive | | | | - Renters Insurance (I always recommend |
| a look of a blank face.What is your household | | | | purchasing renters insurance. It is very affordable.) |
| overhead? The term "overhead" is used in business | | | | - Disability |
| quite a bit. Overhead is the day-to-day cost and | | | | - Life |
| monthly/yearly cost of operating your household. | | | | - Long-term healthcare |
| You would be amazed at how many people do not | | | | - AutomobileEntertainment |
| know what it cost to "operate" their house. They | | | | - Concerts/Movies/DVD Rentals |
| think they know until they actually put pencil to paper | | | | - Books |
| and write out every cost. They are usually very | | | | - Hobbies |
| surprised how much money is actually wasted and | | | | - Memberships/Dues |
| where it all goes. And it goes pretty damn fast.Just | | | | - Vacations |
| as business owners know their overhead the same | | | | - Subscriptions |
| should be for those who run a household. And we all | | | | - Toys |
| operate a household whether you are one person or | | | | - Cable TVMiscellaneous |
| a family of four. You must operate your household | | | | - Medical co-pays/co-insurance |
| like a business therefore you need to know how | | | | - Dental |
| much it cost to operate your house.So let's put paper | | | | - Vision |
| to pencil. You need to know what you spend on the | | | | - Prescriptions |
| following:Groceries & Restaurant Purchases- This | | | | - Accountant |
| includes weekly grocery shopping, eating out at | | | | - Attorney |
| restaurants, take-out (pizza night, Chinese food night, | | | | - Bank charges |
| etc), convenience stops at local grocer, WAWA, 7-11, | | | | - Educational Costs |
| Circle K, Starbucks, Dunkin Donuts, local bagel shop, | | | | - Postage |
| etc.Automobile Costs | | | | - Any other expensesInvestments |
| - Monthly car payment | | | | - Personal savings |
| - Gas & Oil (Shopping for the cheapest gasoline for | | | | - 401K |
| your car is not the best move. Sometimes a cheaper | | | | - Charities |
| gas can cause problems for our cars and in turn cost | | | | - Stocks/Bonds/Mutual FundsNow that you have a |
| you more in the long run). | | | | budget outline you should complete this form over a |
| - Oil Change (It is true you should change the oil | | | | 3-month period. The reason for a 3-month period is |
| every 3000 miles. It will make your car last longer). | | | | because a one-month snapshot is not long enough |
| - Repairs (You should save $20-25 per paycheck for | | | | for a proper analysis.After your 3-month analysis you |
| repairs) | | | | will be able to see where you spend your money and |
| - Parking | | | | the cost for operating your household and lifestyle, |
| - Public TransportationHousing/Shelter Costs | | | | hence your personal lifestyle overhead. Armed with |
| - Mortgage/Rent (If you are paying a mortgage, | | | | this information you will be able to make changes and |
| some folks take the advantage of bi-monthly | | | | hopefully begin to save more and spend wiser.Please |
| payment. Bi-monthly payment means your mortgage | | | | keep in mind just as in business life changes. |
| company splits your monthly payment by two and | | | | Sometimes the change is slow (paying off your |
| they automatically withdraw the payment twice per | | | | school loan) or sometimes fast (becoming ill and |
| month. This figures out to be one extra payment per | | | | needing your appendix out immediately). One should |
| year and in turn it could shorten the life of your | | | | prepare for these changes to the best of their ability |
| 30-year mortgage loan to 21-22 years. Some folks do | | | | and one way is saving money in your bank, envelope, |
| not want to give their mortgage company anymore | | | | jar, etc. for the life's little "Uh-oh's".It is easier than |
| than due and they would rather invest the money in | | | | you think to keep/analyze your overhead. There are |
| stocks, CD's, etc.) | | | | many computer programs that will do this for you. |
| - Property Taxes | | | | One such program is Quicken. There are many |
| - Utilities (Electric, Water, Sewer, Gas, Trash) | | | | others. It will make your life much easier (and your |
| - Telephone (Many people are considering dropping | | | | accountant's).I hope you enjoyed this article.Here's to |
| their land-line. This might be a good idea. If you are | | | | your Health, Wealth & Happiness!Michael J. |
| not in business for yourself yet (and hopefully you | | | | KayeMichael J. Kaye is a chiropractic physician |
| will be soon) why have more than one telephone. | | | | practicing in Bucks County, Pennsylvania. He is a |
| - Security/Alarm | | | | member of the American Chiropractic Association, |
| - RepairsPersonal Costs- Haircuts | | | | Pennsylvania Chiropractic Association and the |
| - Toiletries | | | | American Chiropractic Rehabilitation Board. He has a |
| - Laundry | | | | sub-specialty in Chiropractic Rehabilitation. He is the |
| - Dry-cleaning | | | | director of The Rehab Group of Bucks/Montgomery |
| - Childcare | | | | County-a multidisciplinary clinic with an emphasis on |
| - Gifts given | | | | chronic pain and wellness. He is a publisher of two |
| - Allowance for children | | | | papers on rehabilitation of chronic injuries. In general |
| - Clothing | | | | his clinic promotes nutritional and lifestyle changes for |
| - Vitamins/SupplementsLoans | | | | the chronic pain patient.Dr. Kaye also developed a |
| - Revolving charges, i.e. department store charges | | | | web site dedicated to Health, Wealth & Happiness. |
| - Student loan payments | | | | He authored an e-book titled, "The Living Triad"-a |
| - AlimonyInsurances | | | | book about the pursuit of changing lives to live |
| - Health (Add this to your budget even if your | | | | longer. |