So you have adult money now! Do you know how to take care of it and make sure it is used appropriately? If you don’t keep reading! Below you will find steps and tips on how to budget your money, a skill that is crucial for survival and success. Once you master budgeting, you’ll get a clear sense of your financial limitations as well as your freedoms!
Get a sense of your cash flow
How often do you get money? Knowing how often you have access to money ensures that you actually have money to spend. As a student, get a clear sense of how much money you get from a financial aid refund every semester/quarter. If you have a job, get a clear sense of how much you get paid, along with how often you get paid. Once you know your cash flow, you can figure out how much money you have to spend in a semester/quarter, a month, a week, etc!
Identify your costs
What do you have to spend your money on? Make a list of everything you pay every month. Begin by listing the costs that are necessary for your survival and success as a student. Costs to prioritize include– but are not limited to– housing, food, transportation, and textbooks. Costs that are secondary are not necessarily needed; this includes services like Netflix or Spotify. Make sure your costs are not greater than your cash flow! If your costs are bigger than your cash flow, try to find costs that you can reduce or cut out entirely.
Save some money
Are you prepared for an unexpected cost? After you identify your costs, create some wiggle room for unexpected costs. Perhaps your computer charging cable is broken and you need to buy another one ASAP, will you have the money ready? Of course, as students, we are limited with how much we can save, but it is wise to leave as much of our money untouched as possible.
Enjoy your freedoms
What fun things do you want to spend your money on? After you’ve paid everything you have to and put some money on the side for savings, do something fun! Go out for boba or buy a video game! Make sure that you have a clear idea of how much you have to spend for a certain time period. For example, if you have an extra $200 dollars a month, you can only use $50 a week. Do not exceed your spending limit, otherwise, you will be biting into your costs and savings which are necessary for your survival.
All of this can be confusing, but bless the internet age for all its applications! Below are some free apps you can download to help you budget.