23 August 2012

Budget in College!


personal finance
budget


What is a budget?
Budget is about how we manage our money, it is a good habit that will be last for the rest of our life. College is the right time to start learning how to budget your income into many categories of expenses. 
Budget is planning, you know where your money should go instead of spending it without direction. 


Why do we need a budget?
Budget gives us a full control on how and where to spend our money. You will learn how to control yourself and how to prioritize your money on important things. Then you will able to save some of your income to a better future.
Consider that by having a budget, you can save additional $250 per month and you will graduate in 3 years, by the time you graduate from college you will have additional : $9,000! Little things do make a difference. 


How to make a budget?





I usually make monthly budget at the end of every month following these steps:

Step 1: Determine all your monthly income
The first thing to do is to know the total of your fixed income per month. It can be from your part-time job or your parents.



Step 2: Determine your monthly expenses


You will need to do a brainstorm at this stage. Think about: What are my expenses? What things are more important than the other? Focus on what you need rather than what you want.
tips: I usually also determine my daily expenses on food (monthly expenses/30days) to know my budget per day.

Step 3: Determine how much money is left


Subtract income with expenses, you will get how much money is left for your savings. At this point you may want to review your goal in saving (for my post on saving in college, click here) and see if your budget will be able to help you achieve your goal.


Step 4: Compare your budget and your actual expenses
The last step is to live your day with discipline to follow your budget. At the end of month, compare your budget and actual expenses to see if you can follow your budget.


Here is a budget table to help you work on your budget!:)

Category
Month of:
Budget
Actual
Income
From Jobs


From Parents


From Student Loans


From Scholarship


Other Income


Total Income



Expenses
Rent a room or board


Utilities


Telephone


Groceries


Transportation


Insurance


Gas/ Oil


Entertainment


Eating out


Tuition


Books


School fees


Other expenses


Total Expenses



Net Income




Goodluck to work on your budget!:)

www.DearCollegeStudent.blogspot.com

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