Building a Budget

Step 1:  Set Your Financial Goals

Having a goal for your money will help you make smart spending choices.  Before you start creating a budget, take a moment to ask yourself what your financial goals are. Perhaps you want to reduce borrowing or save money for unexpected expenses. Once you decide what’s important to you, you’re ready to start.

Step 2: Identify Your Sources of Income

Once you have established some goals for your money, it’s time to look at where it comes from and where it goes right now. Start by making a list of all your household income sources and the amounts. Include everything: wages (after taxes), savings, parental help, and even financial aid. 

Step 3: Track Your Spending

Over the course of one or two months you should track your expenses. The Financial Aid Office has created an easy and clear Monthly Budget Spreadsheet  for you to use to start building your budget. You can also use online free apps such as Mint or Countabout that help you track your expenses. Even though creating a budget sounds time-consuming, it will help you understand where your money is going and how to better manage it. 

Step 4: Adjust Your Habits if Necessary

If you realize that you are spending more than you are earning, it is time to make some adjustments.  Ask yourself, what are the things I want vs the things I need?  Want-to have expenses are the first area to look for spending cuts. For example, is taking an Uber necessary or can you take public transportation instead? Review your expenses and find ways to cut back. It is important to live within your means and reduce spending as much as possible.