Budgeting Basics

Budgeting is all about planning out spending and saving, and tracking it to see how you are doing. In a budget, typically spending and saving levels are managed relative to the income you have coming in. As you grow older, managing a budget can get more complicated as there are many things to consider. Managing that complexity will be much easier if you establish good budgeting habits early in life. Here are some things to consider as you explore creating your own budget.

– How much income do you have, either through an allowance or a part time job? How often do you get paid?

– What percentage of your income do you want to save for use in the future?

– What are you saving for and how long do you want it to take?

– Understand the difference between long term savings goals like money for college vs short term savings goals like buying a new video game.

For your expenses:

Consider needs vs. wants and how to plan expenses around these considerations.

Budget for your needs first, then consider what is leftover for wants and saving.

How are you going to track your spending? Consider using the spending analytics tool in PCU digital banking!

Learning to plan how you will use your money is critical as you grow older and start managing more and more life events. An early start working with a budget can make a big impact on how you eventually manage money as an adult.