Budgeting for teens
One of the most important tools in having good cash flow is the ability to make and maintain a budget. However a lot of people don't even know where to start or don't have the right mindset to keep it up. Lucky for you I'm going to break down how to create a budget today.
1. Work out your expenses- This may take awhile to do if you are the kind of person who makes a lot of impulse purchases or who has a varying amount of money coming in each money. However for the rest of us this should be simple enough to do. As a teenager most of your money will be spent on going out so a handy tip is to keep the receipts from when you go places or buy things. This can help you to then add up how much you've spent this month and also help to find out how much you spend each month on average. Once you have this number you can really start to put your budget together.
2. Work out your income- Income for those of you who don't know is the amount of money you have coming in each month, this could be pocket money, money from a job or some money that you got for your birthday. If you only get pocket money then this is super easy to calculate as normally you get the same amount each month, however if your parents put the money straight into your bank account then make sure you find out how much they are putting in as this is vital to your budget.
3. Do some simple maths- To find out how much money you have left each month you are going to have to do some simple maths, so have a calculator nearby. All you need to do is simply take away your expenses from your income. This should give you the amount that you have left over after you have done your spending for the month.
4. Positive or Negative- If the number that you have calculated is negative then this means that you are spending more than you make which is a very bad place to be in. This is one of the main reasons people go into debt because they are spending money that they don't even have. But don't worry if your number is negative at the moment, a budget is created to show you the weaknesses and strengths in your finances.
5. Cut out the fat- We all love to treat ourselves, go out with friends and have fun but it shouldn't be done at the expense of your bank account. If you are spending more than you make then it's up to you to decide what you are going to cut out of your life. Think to yourself is that £5 cup of coffee from Starbucks really worth me not having enough money to go places with my friends or get that one thing that you really wanted. A budgets main goal is to help you prioritize as it lays out your money for you so you can't say that you don't know where your money is going.
Hopefully this quick tips will have you well on your way to creating your budget and putting more money in your pocket.
1. Work out your expenses- This may take awhile to do if you are the kind of person who makes a lot of impulse purchases or who has a varying amount of money coming in each money. However for the rest of us this should be simple enough to do. As a teenager most of your money will be spent on going out so a handy tip is to keep the receipts from when you go places or buy things. This can help you to then add up how much you've spent this month and also help to find out how much you spend each month on average. Once you have this number you can really start to put your budget together.
2. Work out your income- Income for those of you who don't know is the amount of money you have coming in each month, this could be pocket money, money from a job or some money that you got for your birthday. If you only get pocket money then this is super easy to calculate as normally you get the same amount each month, however if your parents put the money straight into your bank account then make sure you find out how much they are putting in as this is vital to your budget.
3. Do some simple maths- To find out how much money you have left each month you are going to have to do some simple maths, so have a calculator nearby. All you need to do is simply take away your expenses from your income. This should give you the amount that you have left over after you have done your spending for the month.
4. Positive or Negative- If the number that you have calculated is negative then this means that you are spending more than you make which is a very bad place to be in. This is one of the main reasons people go into debt because they are spending money that they don't even have. But don't worry if your number is negative at the moment, a budget is created to show you the weaknesses and strengths in your finances.
5. Cut out the fat- We all love to treat ourselves, go out with friends and have fun but it shouldn't be done at the expense of your bank account. If you are spending more than you make then it's up to you to decide what you are going to cut out of your life. Think to yourself is that £5 cup of coffee from Starbucks really worth me not having enough money to go places with my friends or get that one thing that you really wanted. A budgets main goal is to help you prioritize as it lays out your money for you so you can't say that you don't know where your money is going.
Hopefully this quick tips will have you well on your way to creating your budget and putting more money in your pocket.
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