How to Create a Budget That Actually Works
Creating a budget helps you take control of your money. It shows where your money goes, helps you pay bills on time, and lets you work towards financial goals. Here is a simple guide to building a budget that truly works. Photo credit: Istock 1. Calculate Your Monthly Income List all sources of income, including: Your salary or wages (after taxes) Side jobs or freelance work Rental income Other consistent income Write down the total amount. This is the foundation for your budget. Photo credit: Istock 2. List Your Expenses Write down all your monthly expenses. Start with fixed costs like rent, utilities, and insurance. Include variable expenses, such as: Groceries Transportation Entertainment Be thorough so nothing is left out. Photo credit: Istock 3. Categorize Your Expenses Group your expenses into categories for better clarity: Housing: Rent or mortgage, utilities Food: Groceries, eating out Transportation: Gas, public transit Debt Payments: Loans, credit card bills Savings: Emergenc...