The first step to budgeting is determining your net income (i.e., your total salary minus taxes and employer-provided programs) for a given time period. The next step is to figure out your fixed and variable expenses for the same period of time. You can then either decide how to utilize any surplus funds or find ways to reduce your expenses if they exceed your income. There are several budgeting plans available that can help you allocate an appropriate amount of money to each type of expense.