By Isa Perez
To lots of college students, budgeting isn’t on the top of their priority list. Mom and dad’s money seems endless — until you start making your own.
A budget is a plan that helps you prioritize your spending over the course of a week, month or year. By creating one, you can develop the knowledge to recognize the difference between your wants and your needs. In the long run, budgeting is important for goals such as paying off your student loans, saving up for a home or going on a grand vacation. However, saving for short-term goals such as buying a new pair of shoes or eating out once a week can make a huge difference in your budget overall.
Most people have a difficult time with budgeting because they feel they only make enough for their bills. However, budgeting actually saves your money. Here are a few reasons to start budgeting, no matter where you are in life:
Reach your goals faster
Want to go on a trip? Have you always wanted to splurge on a designer bag but found it impossible? Budgeting is the way to accomplish both of those things. By not spending all the money you make in small, unnecessary purchases, you’ll have money left over for all the things you’ve always wanted to do.
Pro tip: Make a budget for the trip itself and slowly put your income aside for travel, housing and excursions to make it happen.
Overspending is a lot easier to come by than you think. Without some sort of plan, you’ll find that you’ll be spending your money a lot faster and less efficiently.
Pro tip: Put half of your paycheck straight into your savings account (no touching!) and leave the other half in your checking as spending money. This will allow for you to build up money for emergencies and large expenses while having some money to treat yo self.
Just because you’re making a monthly or yearly budget, don’t let it make you feel tied to it. Budgets are meant to be flexible, because they should also leave room for life to happen.
Pro tip: Be realistic. Allow room for accidents and times of crisis so you’re not left with nothing.
Puts you in control
Without a budget, it’s easy to lose track of where your money goes. Without tracking spending such as grabbing dinner or drinks with friends, you realize that you might not have as much money left as you thought.
Pro tip: Break up your budget plan into sections: rent, food, household, transportation, health, etc.
As you can see, budgeting isn’t as bad as you think. If anything, it’s a great and easy way to save for future purchases and leave you with some room to splurge!