Budgeting

Budgeting allows you to manage your finances and set yourself up for a successful financial future.

Budgeting Tips

  • Share your goals with a family member or friend. Sharing goals with others requires additional accountability on your part, and you'll have a network of individuals supporting you in achieving your goals.
  • Keep goals visible. Keep your list of goals somewhere accessible, or post a photo somewhere to remind you of your goals.
  • Try out this interactive budget to get started!
Financial Aid

Create a Budget in Three Easy Steps

Review Your Financial Goals

One of the crucial steps in creating a budget is creating goals. Write down your short, intermediate, and long-term goals (e.g., things you want to do, places you want to visit, things you want to accomplish, etc.). Consider the financial cost of these goals, and transform your goals into SMART goals (Specific, Measurable, Attainable, Relevant, and Time-bound). SMART goals help you plan financially and sustain motivation toward goal achievement.

  • Specific: Define the goal as much as possible with no ambiguous language.
  • Measurable: Can you track the progress and measure the outcome?
  • Attainable: Is the goal reasonable enough to be accomplished? How so?
  • Relevant: Is the goal worthwhile and will it meet your needs?
  • Time-Bound: Your objective should include time limits.
Student sitting at table, writing on a notebook

Track Your Spending

Tracking can help you identify your spending habits. Until you recognize your spending habits, it can be difficult to make an accurate budget. Track all of your expenses for several weeks, then consider these questions:

  • How much did I spend?
  • What did I buy, and why did I buy it?
  • Are there any trends in when and where I made purchases?
  • How much am I spending on my “wants”?
  • What payment methods did I use?
  • Where would I like to cut back spending?
Student sitting on desk, typing on laptop

Select a Budgeting Method

Choose a method that works for you! Below is a list of a few examples.

  • The Notebook Method: Record all your purchases in a notebook, so you can analyze spending habits over periods of time.
  • Budgeting Apps: Using free Smartphone apps, such as Mint, PocketGuard, Wally, or Level Money, users can track their spending habits.
  • Excel Spreadsheet or Google Sheet: Track your income vs. expenses. Tabs can be added to the document for multiple layers of financial tracking (e.g., loans, investments, taxes, financial goals, etc.).
  • Envelope System: Label envelopes with a spending category (e.g., rent, utilities, groceries, emergency, entertainment, etc.). Put a set amount of cash from each paycheck into the envelopes. When you’ve spent all the money from an envelope, stop spending money in that category until the next time money is divvied out. Only use this method if you have a safe place to keep your envelopes!
  • Multiple Accounts: Separate your paycheck between multiple accounts, such as Living Expenses and Bills, Long-term savings, Emergency fund, etc.
  • 3-Category Budget: Track your overall spending for a of couple weeks, choose three categories you’d like to control, and consistently monitor your spending in those three categories.
Student sitting at table while looking off into the distance, pen ready to write in notebook

Review Your Financial Goals

One of the crucial steps in creating a budget is creating goals. Write down your short, intermediate, and long-term goals (e.g., things you want to do, places you want to visit, things you want to accomplish, etc.). Consider the financial cost of these goals, and transform your goals into SMART goals (Specific, Measurable, Attainable, Relevant, and Time-bound). SMART goals help you plan financially and sustain motivation toward goal achievement.

  • Specific: Define the goal as much as possible with no ambiguous language.
  • Measurable: Can you track the progress and measure the outcome?
  • Attainable: Is the goal reasonable enough to be accomplished? How so?
  • Relevant: Is the goal worthwhile and will it meet your needs?
  • Time-Bound: Your objective should include time limits.
Student sitting at table, writing on a notebook

Track Your Spending

Tracking can help you identify your spending habits. Until you recognize your spending habits, it can be difficult to make an accurate budget. Track all of your expenses for several weeks, then consider these questions:

  • How much did I spend?
  • What did I buy, and why did I buy it?
  • Are there any trends in when and where I made purchases?
  • How much am I spending on my “wants”?
  • What payment methods did I use?
  • Where would I like to cut back spending?
Student sitting on desk, typing on laptop

Select a Budgeting Method

Choose a method that works for you! Below is a list of a few examples.

  • The Notebook Method: Record all your purchases in a notebook, so you can analyze spending habits over periods of time.
  • Budgeting Apps: Using free Smartphone apps, such as Mint, PocketGuard, Wally, or Level Money, users can track their spending habits.
  • Excel Spreadsheet or Google Sheet: Track your income vs. expenses. Tabs can be added to the document for multiple layers of financial tracking (e.g., loans, investments, taxes, financial goals, etc.).
  • Envelope System: Label envelopes with a spending category (e.g., rent, utilities, groceries, emergency, entertainment, etc.). Put a set amount of cash from each paycheck into the envelopes. When you’ve spent all the money from an envelope, stop spending money in that category until the next time money is divvied out. Only use this method if you have a safe place to keep your envelopes!
  • Multiple Accounts: Separate your paycheck between multiple accounts, such as Living Expenses and Bills, Long-term savings, Emergency fund, etc.
  • 3-Category Budget: Track your overall spending for a of couple weeks, choose three categories you’d like to control, and consistently monitor your spending in those three categories.
Student sitting at table while looking off into the distance, pen ready to write in notebook