The basics of budgeting

student working on their budget

New to earning money and need to enroll yourself in a little Budgeting 101? Consider this a crash course in all things budgeting.

As a high school student, you may be new to making your own money — and all the fun ways to spend your earnings. And while splurging on new clothes, concert tickets, or electronics might be tempting, you should also consider the big-ticket items worth saving for — like a car or college.

Creating a budget can help you get a handle on your money, and help ensure you have money for the things that are important to you. And while budgetingdoesn’t sound super appealing, it’s actually just a way to say that you track your spending — which you may already be doing anyway! Here’s how to formalize the process a bit, so you can get a grip on the money you have coming in and going out.

1. Start with a spending diary

Before you start making a budget, take a couple weeks to see where your money is actually going. Keep track of everything you spend, whether you’re putting a couple bucks in the school vending machine, paying for a college application, or going to a movie. If you have a Wells Fargo checking account, Budget Watch can help you track spending digitally.

Once you have some notes on how you’re spending your money, build a budget like the one below where you map out how much you’re earning and track your expenses. You may find it helpful to bucket your spending into categories like entertainment, food, clothing, sports, etc. And better yet, start to identify categories/expenses that are essential (like your school lunch, which you know you have pay for every week) versus discretionary spending (those new headphones you really want).

Be sure to build in some savings like the person did below, taking a few dollars out for college savings or a more expensive item you’re saving for:

Photo: Source:

2. Put your money where it matters

If you aren’t pleased with the way your budget looks (read: you’re spending too much on nonessential items or just want to ramp up your savings), brainstorm some ways to make a change. Watch for sales when buying clothes, bring a snack with you instead of grabbing fast food after practice, or finally request that your friend pay you for those football tickets from last month. Whatever it is, make some changes to your spending.

3. Keep checking your budget

You’ve tracked your spending, you’ve made goals for your money management, and you’re following through. This is the gist of budgeting! Over time, as your finances become more involved, you can implement bigger changes and challenges. Some ideas:

Starting to earn your own money is an exciting time in your life. Learning to budget early on will help you make the most of your earnings while also finding a way to treat yourself during the process. Can you say best of both worlds?

Test yourself

If your expenses add up to more than your income, you’re on the right track.



Answer: False. If your expenses add up to more than your income, you should examine your spending by asking, “What can I do without?” and “What’s really important?”

Want to read more about Handling day-to-day spending?

Wells Fargo Chat

You can customize your experience with a quick chat

Related articles