People who do well with money pay attention to their money. Yes, but how? And how often?
The “how” is by creating and maintaining a written budget. The “how often” is as often as you can, but most do this with a monthly budget.
The good news is that basic budgeting doesn’t have to be time-consuming or complicated. You don’t have to pour over detailed spreadsheets filled with math formulas or charts and graphs to keep track of your money. In fact, the simplest of budgets need only have three parts: Needs, Wants, and Savings.
It’s as simple as that! On a sheet of paper, a computer, or your phone, make a list of expenses in these three categories. Then, plan for spending during the upcoming month for each.
What are needs? Things like your rent, car payment, and electricity bill go in this section. What are wants? List any items you’re planning to buy but aren’t a necessity. Then, list the savings you’re able to keep after you’ve spent on the other two categories. If you find that you don’t have any savings, then you want to hold off on the “wants” for a little while.
Of course, budgets can be a bit more detailed than that, so if you’d like to learn more budgeting techniques and start paying closer attention to your money, visit our free online budgeting class. Member One offers comprehensive online educational resources to help you make smart financial decisions.
Visit our Financial Education Center to learn more about creating and following budgets.
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