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Things you should know before we begin...
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What is a budget?
A budget is like a plan or an estimate of your income. Lets say you're spending too much money or you want to save up for something special. You have to know where you money is going and how much. You first have to make a realistic plan or budget. You must know where all your money is going to go. All of your money must be assigned even if it just go towards saving. Once you've made a budget, you must stick to it. Your budget may not be 100% correct because it is an estimate, but if you do not stick to it, it will be pointless. Lastly, a budget is going to be annoying and hard. You have to track every cent you spend. Keeping receipts, tracking spending, and counting money. Is a budget worth it?
How to Start a Budget
First of all, you should make budget goals. Like only spending a certain amount of money each month. Then you have to do is make a list of all the things you buy on a monthly basis. This includes needs and wants like mortgage pay, car insurance, and Netflix. You have to know how much they cost or make an educated guess. Once you have this information, write down how much money will have to be put into each item. Some things can be put into categories like House Appliances. Once you have your budget planned out, follow it and keep your receipts so you can keep track of your money. Remember: The goal of a budget is to know where your money is going and hopefully be able to find a way to save some.
Different Expenses in a Budget
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Fixed ExpensesA fixed expense is a consistent need at a consistent price. Neither changes and is bought regularly.
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Variable ExpensesA variable expense is still a need, but it's cost can change due to weather or other variables.
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Discretionary ExpensesThese are wants that you still want to be in the budget. The cost can change as long as the money is accounted for.
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