A budget is a plan that helps you manage your money. It shows you how much money you have, how much money you need to spend on different things, and how much money you can save or use for other goals. A budget can help you make smart decisions with your money and avoid problems like overspending, debt, or running out of money.
Why do I need a budget?
Money is a limited resource, and you probably aren't able to buy everything you want or need with the money you have. It's important to prioritize your expenses and choose what is most important for you and your family. A budget can help!
Track your income and expenses.
Your income is the money you earn or receive from different sources, like your allowance, gifts, or jobs. Your expenses are the money you spend on different things, like food, clothes, bills, or entertainment. A budget can help you see how much money you have and where it goes every month.
Set and achieve your goals.
Your goals are the things you want to do or have with your money, like saving for a bike, a college fund, or a vacation. A budget can help you plan how much money you need and how long it will take to reach your goals. It can also help you adjust your spending habits to save more money for your goals.
Avoid or reduce debt.
Debt is the money you owe to someone else, like a bank, a store, or a friend. Debt can be a problem because it can cost you more money in interest and fees, damage your credit score, or cause stress and conflict with friends and family. A budget can help you avoid or reduce debt by helping you spend less than you earn, pay off your bills on time, and avoid borrowing money you don't have a clear plan for repaying.