How to Budget

How to Budget

An important skill to use to master life

Poll

Does your family have and use a budget?

• Yes

• No

• Not sure

Income - how much money is coming in

Your job calculates how much you earned, and how much is going to be withheld.

You should ALWAYS ALWAYS review your pay-stub.

Mistakes do happen. It is up to you to tell your employer if there is a mistake. It is YOUR money after all, right?

Make sure you are getting paid correctly and that any deductions are correct.

Poll

I always review my pay-stub every payday.

• Yes

• No

Expenses

You need to know how much you are spending

• Write down your repeating bills

• Keep track of your spending

To create a budget you must

• know how much money you have coming it

• know how much money you have going out

• know WHERE you are spending your money

Poll

How much do you spend on eating out each month?

• Less than $20

• Between $20 and $75

• Over $75

There basically two "types" of spending

• Fixed

• Variable

Fixed Expenses

These are predictable, regular costs, which tend to be large - like rent; car payments; and student loan payments.

Variable Expenses

These are expenses that can change from month to month. For example - groceries; the electric bill; and eating out.

Mandatory or optional?

Some expenses you MUST have and pay - like your rent. Some you can choose NOT to spend - like Starbucks every morning.

Multiple Select

Which of these are fixed expenses?

• Car insurance

• Starbucks

• Rack Room

• Cell Phone

Multiple Select

Which of these would be mandatory expenses?

• Rent

• Car Insurance

• Unlimited Data on phone

• Tanning salon

How do you get started?

• Does your bank have an app?

• Does their app allow you to classify transactions?

• If you answer no to either of these then ...

You need to be able to track all your spending and income

• You can download an app specifically designed for budgeting and tracking.

• These apps often can tap into all your financial accounts and combine the data

• You can also go old school - paper or a spreadsheet

• There are MANY downloadable templates for use with spreadsheets or paper

Poll

Take a look at your bank's app. Are you able to label/classify various transaction?

• Yes I can

• No I cannot

• I don't have the app for my bank

• I don't have a bank account