← News Oct 7th 2016

Be consciuous about your everyday budget!

wallet with cash

If you do not want to soon run out of money, need to create a budget for your college days now. Even if you are lucky and your parents are paying forcollege entirely, again you need to have an everyday budgetand stick to it. Thus, you will be more confident and also more flexible.

Having a budget does not mean that you should not have fun at all. You just need to budget it in. And have in mind that such costs will probably increase in the future and plan this, too. For example, smokes will get increased by 50 cents and sugary drinks will get taxed from April 2018. Also, you will find more ways to have fun and most of them will cost some money.

How to Control Your Money?

You need to divide your expenses into categories and then prioritize them. You should spend your money first on what is really important such as food and bills and then on additional things such as going to a party. Set reasonable limits for all of your spending categories. Then, stick to them. This will help you form some good spending habits.

How to Set up Your Budget?

You have to set up your budget because this will let you see where your money is going. You will also know how much you have left to save or spend. Here are the steps for setting us a budget:

Determine How Much You Earn

It is essential to know how much money you will have each month, i. e. what resources you will have to meet your expenses. If your income is variable, then you need to set up a different and more flexible type of budget.

Determine the Fixed Expenses

These are the expenses which do not change from month to month - rent, bills, loans, a car payment and insurance, and others.

Determine Your Variable Expenses

Such expenses are eating out, having fun, clothing and others. The good thing about them is that you can cut back on how much you spend on themif there is need for this. Check your variable expensesby reviewing the expensesfor each variable category for the last 2-3 months.

Comparethe Expenses to Your Income

Your purposes should be to create a budget where your outgoing expenses are covered by your income. Try to figure out what amount you can afford to spend every day and then stick to it.

Track Your Expenses

After setting up a budget, track your expenses every day in each category. You can also use some budgeting software if you need to. You should make a careful estimation what amount you can spend each day in in each category. This is the way to prevent overspending. Spend a few minutes every day to check whether everything with your budget is going normally.

Adjust Your Budget as Needed

You are able to make financial adjustments easily throughout the month. Urgent costs may appear. You can take money from a variable expenses category to help you cover the unexpected costs. When you take money which was planned for something else, take this into consideration in your budget.

Evaluate the Budget

After you have followed your budget for some time, you will get used to the everyday financial limitations. If there is a need of budget improvements, you can cut back in a few areas and spend them on other things. You can keep changing your budget until it works for you. Just avoid overspending.

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