A well planned budget is like a good workout plan: it maximizes your resources and minimizes the impact of life’s potential surprises. That’s why establishing one and sticking to it can be a great way to get financially fit for your freshman year. Follow these tips, and you’ll hit the ground running when you get to college:
- Track your spending. Keep an honest account of what you’re spending money on for a couple of months before you make your budget. This will help you identify your priorities and any areas where you might need to plan a little bit more.
- Make a list of your income and expenses. Use Wells Fargo’s Cash Flow Worksheet or My Money Map to help document where your money is coming from – your job or federal work-study, for example – and what expenses you might have, housing, gas, food, study materials, etc.
- See what’s left. After totaling your income and expenses, see how much you have left over. This money can be put into savings, set aside for trips home, or used for entertainment and other outings.
- Set clear goals. Do you want to build your savings account? Take a fun trip over spring break? While you’re looking at what money is available and where it is going, you can set clear financial goals for yourself and know exactly how much you need to set aside each week or month.
- Stick to it. A budget can be a tremendous asset but only if you stick to it. You might need to adjust it over the next few months as you become more familiar with your spending habits. If you’re still finding it difficult to follow, sit down and take another look at it. Remember, your hard work will pay off in the end – and can help make your financial goals a reality.