Budgeting

Understanding Budgeting

Prepare for College

A budget is a plan for your future income and expenditures that you can use as a guideline for spending and saving. Although many Americans already use a budget to plan their spending, the majority of Americans also routinely spend more than they can afford. The key to spending within your means is to know your expenses and to spend less than you make. A good monthly budget can help ensure you pay your bills on time, have funds to cover unexpected emergencies, and reach your financial goals.

To create or rework your budget:

• Add Up Your Income
  Determine how much income you have
• Estimate Expenses
  Keep track of how much you spend for one month
• Figure Out The Difference
  Total up your monthly income and your monthly expenses, subtract the expense total from the income total to get the difference.

A positive number indicates that you are spending less than you earn - congratulations. A negative number indicates that your expenses are greater than your income. This means you will need to trim your expenses in order to begin living within your means.

Budgeting Apps

Track your monthly home budget for free with these apps.

Taking time to make a budget can help you make smart financial decisions today and reach your goals in the future. Setting up your budget is simple. You just need to take the time to get started. To learn more about personal budgeting, visit http://StudentAid.gov/Budget