What is a budget exactly? A budget is an estimate of expected income and expense for a give period of time in the future. But what is that really? This means that after you cash your check, you don’t blow half of it on the way home. Instead, you take all of what you make from any job you may have and you plan it all out. Every dime is accounted for.
Instead of just paying bills when they come in and buying whatever you want whenever you want you have to plan it out. Most people are probably used to this, but it could cause a lot of problems. You might forget which bills were paid off for which month. It’s important to be organized when it come to money.
You must have all your expenses planned out and set up for each month. This way you know exactly what you need to spend each month. When you have all your bills planned out, you don’t have to worry if you remembered to pay them all.
Even if you don’t get formal bills a budget will help you keep track of all your expenses. Maybe you just give your parents money to pay for your cell phone. In fact, this could be easier to mix up if you don’t keep track. You might end up paying twice for one month. I’m sure you don’t want to do that.
In your expenses, you must include everything you could possibly spend money on, including fixed expenses such as gas and insurance, but also variable expenses such as fun money, and money for gifts.If you have a set amount, you won’t go over. You must budget out every dollar you make.
By spending this way, you will always be spending nearly the same amount every month and may just have room to start saving. I’ve been budgeting since I was about 16 and although sometimes I go off of it, it has helped me organize a lot. Also, I’ve gotten my spending under control and I have been able to save for a lot of important things such as a car and college tuition.