[creating a budget]

"Money is like fire. You can use it wisely and become successful, or you can use it unwisely and be burned by it." Anonymous

Overview

Budgeting is a must to stay out of financial trouble and live within one's means. It involves first tracking money coming in and out to establish a base from which to create a meaningful budget plan and allow funds to be set aside for saving, spending, and future goals. A budget will put you in control and help you decide in advance what you can and cannot afford - and it will protect you against unforeseen events.

1. Why budget? To allow saving over spending - get in the habit of saving at least 5% of your income.

2. Next, you need to set goals:
a. Short-term (college semester)
b. Medium-term (academic year)
c. Long-term (course of study)

3. Create a budget to meet your goals
a. Estimate income vs. expenses
b. Estimate future expenses
c. Factor in changes
d. Make adjustments as needed

Tips for maintaining a budget:

1. Each month, compare your income to your expenses. Continue reworking your budget until your income is greater than your expenses.
2. Become a savvy consumer - learn how to get the most for your money, e.g., sales, coupons, comparison shopping.
3. Exercise will-power and self-control - try not to indulge in unecessary spending.
4. Develop a good record-keeping system - learn how to maintain a workable budget and track your income and expenses. Evaluate your progress regularly.