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A budget is one of the best tools to help manage your money. It helps make sure you have enough for your regular expenses while also giving you a plan to save for future goals or unexpected emergencies.

What is a budget?

A budget is simply a plan for how you will use your money each month. It shows:

• How much money you bring in (your income)
• How much money goes out (your expenses)

A budget helps you see where your money is going, where you can cut back, and how you can set aside funds for savings or other goals.

How to Create a Budget

Getting started is easier than you think. Use our Budget Worksheet and Budget Calculator to help organize your finances.

Step 1: List Your Expenses
Write down all of your regular bills such as rent, utilities, and phone service. Then include everyday expenses like groceries, gas, and entertainment.

Step 2: Add Up Your Income
Use your pay stubs to figure out how much money you make each month. Be sure to include any other sources of income like child support or side jobs.

Tip: If your income changes from month to month, add up what you earned over the past year and divide it by 12 to estimate a monthly amount.

Step 3: Do the Math
Subtract your total expenses from your total income.

• If the number is positive, that is money you can put toward savings or paying down debt.
• If it is negative, you are spending more than you make. Look for areas where you can cut back.

How to Stick to Your Budget

A budget works best when you use it regularly:

• At the start of the month, decide how you will spend your money.
• Track your spending throughout the month.
• At the end of the month, review how you did. Did you stick to your plan?
• Make adjustments as needed for the next month.

Even small changes can help free up money to save, whether for emergencies, a vacation, or a big purchase. You can also treat savings like any other bill by including it in your monthly expenses.