Why You Should Budget
Budgeting is probably the most important aspect of financial literacy for students and young adults. It’s the key to limiting unnecessary stress and becoming financially independent. Why is this so?
First, budgeting keeps you organized. It helps you know exactly how much money you’re making and how much you’re spending. Perhaps more importantly, it helps you know exactly what you’re spending your money on.
Second, budgeting enables you to be intentional with your hard-earned money. Being intentional means that you spend your money on things that really matter to you. It’s a great habit to start while you’re young to prepare for when you’re older and making more money and bigger purchases. These purchases might include buying a car, travelling the world, and paying for college (after getting all the student aid you can).
Finally, budgeting helps you save money. It’s vital to save enough money to sustain you for six months to a year in an emergency. If you save money, you’ll be able to achieve and maintain financial independence.
How You Should Budget
Budgeting can seem intimidating, but it doesn’t need to be. You can start budgeting right now with six easy steps:
- Create and use a budget template (like the ones linked below).
- Record how much money you have on the day you start your budget.
- Keep a record of all your expenses.
- Make sure you’re spending less than you earn.
- Make a plan for your budget to help you reach short- and long-term financial goals.
- Accomplish your goals by putting your plan in motion.
Click below to download a budget template from NerdWallet to get you started.
How YFIA Can Help
The Youth Finance Institute of America (YFIA) is a 501(c)(3) tax-exempt, nonprofit organization dedicated to preparing students to become financially stable and independent into adulthood. With your help, we can ensure that students and young adults have all the financial help they need. YFIA travels to different schools across California to train and educate students about money management and the steps the students should take to prepare for their future. To help us reach more of these California students who are in need of financial training, please consider donating whatever you can. Thank you!