Budgeting 101 Getting a paycheck is exciting! There are so many possibilities for that money; new clothes, saving for a car, eating at your favorite restaurant. But of you aren’t careful, that money will be spent as soon as it gets in your hot little hand. That is why we build a budget!
Budget = Spending plan The word budget sounds official and feels like a big responsibility. In reality, a budget is just a plan on how you will spend your money. A budget will help you make those paychecks last until your next one, and even save some money along the way!
How do you make a budget? A budget is made in 5 steps: 1. Record income- Any money you receive is considered income. That can include babysitting money, allowance, a paycheck, birthday money and any other money you receive. 2. Track your spending- Before you build your budget, you need to know where you typically spend your money. Take some time to track your spending on any bills and other purchases. Track from one pay period to the next. 3. Set goals- When you have a goal you are trying to reach, such as saving for an item or paying off debt, your are more likely to follow your budget 4. Put together your budget- At the top of a piece of paper, write your total income, then list your expenses. Subtract your expenses from your income to see how much you have left at the end of your pay period. 5. Make adjustments- if you are spending too much, go through your expenses and start cutting expenses you can live without.