One thing we never learn in college is how to budget and manage our money. One would think that Accounting 101 would be for personal financial management, where we learn how to balance a check book or how to pay bills. Instead we are taught how to create an income statement and a balance statement. How about preparing us for the real world?
Here are some tips on how to budget:
- Understanding your paycheck: Learn to read your paycheck. Understand that what you were quoted in your job offer is not what you will be receiving on your bi-weekly(or semi-monthly) paychecks. Please note, there will be federal and state taxes that will be coming out of your check. If you decide to take advantage of your company's insurance benefits, that will come out of your paycheck too. So after those deductions are made, you have the balance. Remember. this is what you are you left with to live on for the next two weeks until you are paid again.
- Calculate your monthly expenses: One thing you do not want to do is not have enough to cover your bills. Sit down and consider your bills that you have to pay every month.
• How much do you pay for rent?
• How much do you pay for utilities, such as gas, electricity, and water?
• How much do you pay for cable and internet?
• How much do you spend for your car note?
• How much do you spend of gas for your car?
• How much do you spend on your commute to work via public transportation?
• How much do you spend on student loan debt?
• How much do you pay for your credit cards?
• How much do you pay for your cell phone?
• How much do you spend for groceries?
• How much do you spend for entertainment?
Consider everything you may spend a month, and it should less than what you make monthly. You do not want to spend more than you make.
- Saving, saving, saving!: Always make sure that you are budgeting in some savings a month. This will help you if you ever get in a tough spot. Make sure that you think about how much you can put aside every month. It does not have to be a whole lot, it can be whatever you want it to be.
- Setting goals and Priorities: You need to determine where your priorities are and set goals. If you are trying to pay off your credit cards, set that goal and make it a priority. Stick to your goals and priorities. If you cannot afford it, then you just can't do it. Don't beat yourself up about. This is going to help you with your financial future.