Making a budget is the most important step in controlling your money.
A budget allows you to track your Income (the money that you have) and your Expenses (the money you spend). By writing down your monthly income and expenses, you can see how much money you expect to have for the month and plan for how much you can spend.
The first rule of budgeting is simple: Spend less than you earn!
If you earn $150 a month from your job, and earn another $50 from your allowance or birthday money, your income for the month is $200. If your savings account earns another $5, your total income is $205.
Now you know that you have to spend less than $205 for the entire month.
Estimate all “incoming” money, including salary from a job, allowance from your parents, and birthday money.
Required expenses include taxes and bills that you must pay. Required bills may include your cell phone bill and gas money to drive to work or school. You should also include payment to your savings in the “Required Expenses” category. Whether you are savings for something specific (like a car or college) or just tucking money away for the future, it is critical that you get in the habit of paying yourself first! Even a few dollars each month helps build your savings.
After you have paid your Required Expenses, you can use the money left over for some fun!
Discretionary Expenses may include clothes, shopping, pizza, video games, gifts and any other expenditures that are considered “optional”.
Review the following Sample Budget on page 2, and then make your own monthly budget using the worksheet on page 3. Stay within your budget, pay yourself first, and you will always be in control of your Money and Stuff!
Negative amounts are (in parentheses)
|Category||Monthly Budget||Actual Amount||Difference|
|INCOME:||Estimate Your Income||Your Actual Income|
|Wages/Income Paycheck, Allowance, Birthday Money, etc.||$200||$210||$10|
|Interest Income From Savings Account||$5||$4||($1)|
|EXPENSES:||Estimate Your Expenses||Your Actual Expenses|
|Taxes - From Paycheck||$30||$32||($2)|
|Utilities Electric, Cell Phone, etc.||$30||$30||$0|
|Entertainment Movies, Pizza, Video Games, Bowling, etc.||$20||$25||($5)|
|Other Expenses||Ski Club:$10||Ski Club:$10||$0|
|NET INCOME Income Minus Expenses||$20||$35||$15!|