When  paying  bills  with  cash,  people  have  no systematic method of payments. In addition, they must  use  receipts  as  their  only  record  of  payment. (A  checking  account  provides  a  canceled  check as a receipt of payment. Also, checks are available with  carbon  duplicates  of  the  original  check.) Working  on  a  cash  basis  can  also  create problems if personnel are on leave or temporary duty. In such a case, members must make arrange- ments  to  forward  their  paychecks.  This  often results  in  delays  in  the  receipt  of  a  check. ALLOTMENTS.     —Allotments    provide    a good  method  for  Navy  members  to  handle  their financial   affairs.   The   following   paragraphs describe  voluntary  and  involuntary  allotments. Voluntary Allotments.  —Voluntary allotments are  requests  by  personnel  to  make  a  certain amount  of  their  paycheck  payable  to  someone  else for  the  following  reasons: ·   Purchase of U.S. savings bonds ·   Payment of premiums for life insurance · Repayment  of  loans  to  the  Navy  Relief Society ·   Allotments to dependents and relatives · Voluntary liquidation of debts to the United  States · Payment to a banking institution or asso- ciation  for  credit  to  the  account  of  the allottee · Repayment of loans for the purchase of a home or mobile home used as a residence by the allottee · Payment  of  pledges  for  the  Combined Federal   Campaigns Involuntary   Allotments.   —Involuntary allotments  from  a  Navy  member’s  pay  are  usually made when the person shows financial irrespon- sibility.  Involuntary  allotments  are  usually  gar- nishments  of  a  member’s  pay. BUDGETING.   —Preparing  and  using  a budget  is  the  key  to  successful  money  manage- ment. A budget is a plan to spend money or a plan of   money   management.   Many   Navy   members have  erroneous  images  of  the  meaning  of  a budget.  They  often  associate  budgets  with  detailed bookkeeping,  stacks  of  papers,  ledgers,  and  so forth.  Many  young  members  lack  the  discipline to  follow  a  budget  and  dislike  the  chore  of budgeting.  If  you  can  convince  them  to  follow  a budget,  they  are  the  winners.  They  will  have  a record  of  their  income  versus  expenses,  which  will help them better manage their financial affairs. This provides them with the security of knowing their  financial  status  rather  than  the  insecurity  of not  being  sure. To give your people the desire to budget their money,  put  budgeting  into  simple  terms  for  them. Explain how a budget serves as a simple tool for the businesslike  management  of  their  finances.  Ex- plain  that  budgeting  provides  an  advance  general plan for organized spending and savings instead of  a  record  of  payment  set  down  afterward. Budgeting involves the spouse as well as the wage  earner.   For  married  couples,  handling money matters should be a joint effort. With two- income  families,  money  management  is  a  different ball   game.   The   “yours-mine-ours”   approach usually  arises,  requiring  definite  understandings. Certain inherent expenses become greater when both husband and wife earn wages. Couples also need to have an understanding as to what expenses they will pay from what funds. A written budget, properly  prepared  and  followed,  helps  couples work  out  these  problems. In  counseling  and  advising  your  people  on financial management, you may have to help them prepare  their  budgets.  In  budget  preparation,  you determine  income  and  expenses;  examine  spending habits;  and  see  what,  if  anything,  you  need  to correct  or  improve.  If  personnel  have  financial problems,  you  help  them  find  ways  to  improve their  spending  habits.  To  do  this,  you  need  to familiarize them with the following terms used in financial  management: Gross  income.  The  total  amount  of  salary before  any  deductions Deductions. The amount of money taken from pay for income tax, social security, and other reasons Allotments.  Those sums of money deducted from  gross  income  to  pay  debts  such  as insurance  premiums,  debts  due  the  United States,  and  family  support Net Income. The total amount paid a member after all deductions and allotments are paid, often  called  take-home  pay Fixed expenses.  Expenses  that  are  the  same each  month Flexible  expenses.  Expenses  that  change  from month  to  month;  sometimes  called  variable expenses 4-13