If you have a checking account, of course you balance it periodically to account for any differences between what's in your statement and what you wrote down for checks and deposits. Many people do it once a month when their statement is mailed to them, but with the advent of online banking, you can do it daily if you're the sort whose banking tends to get away from them.

You balance your checkbook to note any charges in your checking account that you haven't recorded in your checkbook. Some of these can include ATM fees, overdraft fees, special transaction fees or low balance fees, if you're required to keep a minimum balance in your account. You also balance your checkbook to record any credits that you haven't noted previously. They might include automatic deposits, or refunds or other electronic deposits. Your checking account might be an interest-bearing account and you want to record any interest that it's earned. You also need to discover if you've made any errors in your Record keeping or if the bank has made any errors.

Another form of accounting that we all dread is the filing of annual federal income tax returns. Many people use a CPA to do their returns; others do it themselves. Most forms include the following items:

Income - any money you've earned from working or owning assets, unless there are specific exemptions from income tax.

Personal exemptions - this is a certain amount of income that is excused from tax.

Standard deduction - some personal expenditures or business expenses can be deducted from your income to reduce the taxable amount of income. These expenses include items such as interest paid on your home mortgage, charitable contributions and property taxes.

Taxable income - This is the balance of income that's subject to taxes after personal exemptions and deductions are factored in.

Keeping to the family budget

The high cost of living in today's society, wherever you may be, has made budgeting a priority among families.  In today's inflationary world, nothing is more important than knowing how to wisely spend the meager income that you get.

Financial problems usually arise due to lack of proper budgeting skills, or failure to keep to the proposed budget.  No matter how much income you may have, it is still important to keep track of your assets and liabilities, your earnings and expenses.

It is ironic but a person who earns thousands will have the same problems with the person who earns by the hundreds.  Most often, different kinds of people, with diverse income levels, have budgeting problems.   Others, who may have been successful in making a budget, usually fail to keep within such a budget.

A budget refers to a financial plan, taking the incoming and outgoing monetary resources into consideration.  A good budget should not only mean a balance or equity between income and expenditures.  It also means lesser expenses, and making an allowance for savings.

If you earn a thousand dollars per month, you should map out all the necessary expenses you will have to incur during the month such as payment for your house, food and transportation.  Of course, this is presuming that your tax liabilities have already been settled.  What remains after you deduct your total expenses from your income is your savings.

What you do with your savings will make a difference later on, when the need arises.  You can choose to keep your savings in a piggy bank or place it in a bank where there is minimum interest rate but at least your money is safe from you and from intruders.  With a bigger savings, you can get the services of a financial adviser who can give you higher-yielding investment options

Here are tips to make sure that you keep within the family budget:

1. Maintain a logbook where you can list your income and expense account on a weekly or monthly schedule. 

2. Buy your groceries at one time.  To do this, make a list of all the things that you would need for your target period and purchase them at one time.  Sometimes, there are discounts if you buy by the dozen so take advantage of this.

3. Avoid going to the supermarket and shops if you do not need to buy necessary items.  This will keep you from making unnecessary purchases and keep you from straying away from your budget.

4. Think twice before you buy something.  By doing this, you will realize that it is really need or don't need.