This step takes the list of expenses you created a couple of steps ago and re write it in order of priority. For this you can exclude price as a consideration, just what is the most important. For couples this step should first be done separate, as priorities are rarely the same.
For example my list would start like;
1. Rent or mortgage
3. Gas (Heat the house)
58. Magazine Subscriptions
59. House phone
I find by listing in order of priority it helps clarify want you value as you move into the next few steps. Also almost everyone has things at the bottom of the list that are no longer a priority.
If you are working through this as a couple I would recommend doing this separately, as priorities should not be expected to be the same. After discussing the lists works out well, as it helps understand what is important to the other as you move forward. Of course this conversation should not be used to judge, or criticize, but to understand and learn about the other as you move to creating a strong joint financial foundation.
Now I need to go cancel the house phone and a magazine subscription.
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