Start Saving & Budgeting
Developing a budget and savings plan will help you weather rough times and meet your goals.
Set Goals
Examples of short-term goals:
- Money to cover the down payment on a new car
- Money to buy bedroom furniture
Examples of medium-term goals:
- Money to pay for a home down payment
- Money for home improvement
- Money for future college expenses
Examples of long-term goal:
- Saving money for retirement
Determine Your Income
Figure your available income - the amount of your take-home or net pay, not your salary or gross pay. Do not include overtime pay. You should not rely on overtime pay as regular income.
Determine Your Expenses
- Know where you money is going.
- Fixed expenses such as rent, auto or student loan payments are easy to determine.
- Flexible expenses such as food, clothing and entertainment vary from month to month.
- Be sure to include expenses such as taxes or insurance that are billed quarterly, semi-annually or annually.
Create Your Budget
- Think of your budget as a spending plan.
- Your budget should meet your needs first and then the wants that you can afford second.
- Your expenses should be less than or equal to your total income.
Pay Yourself First
- Saving is an important part of protecting yourself financially.
- Save as much as you can every month.
- Even a small amount will make a big difference if you save
consistently.
- A great goal is to establish an emergency savings fund large enough to cover three to six months of your living expenses.