Don’t be intimidated by creating a budget. Here are just a few simple things you’ll need to do to get your budget together. You can use the Why I Work tool to help you set up your budget and get an idea of what things might cost.
Set Your Education Time Span
Decide whether you’re going to create a budget for each month, semester, quarter, or calendar year. Monthly budgets are particularly helpful if you think money is going to be tight, which is often the case when you’re in school.
Involve Your Family
Talk to your family to see if they can and/or will be providing you with any financial assistance. This can include help with tuition, school supplies, and/or living expenses. Clearly identify how much your family will be helping, and what might be expected from you in return.
List Your Income
Estimate and list how much money you will have coming in each month. That includes money from:
- Working
- Financial assistance from family
- Financial aid from scholarships, grants, work-study, or loans
- Financial aid credit balance refunds (money left over after your financial aid is applied toward tuition and fees)
List Your Expenses
Make a list of everything you spend money on. Then list how much money you spend on each thing. Make sure you include your college costs in your list. Those costs should include:
- Tuition
- Fees
- Books and supplies
- Equipment and room materials
Once you’ve listed your expenses, break them out into expenses that will stay the same each month/semester/quarter/year and expenses that will change. Fixed expenses often include car payments, insurance, cell phone bills, and rent. Variable expenses often include groceries, clothing, and entertainment.
Save for Emergencies
Set aside savings as a fixed expense so that you can pay for any unexpected expenses.
Balance Your Budget
Subtract your expenses from your income. If you have a positive balance, it means you’re not spending more than you’re earning. As long as you stay within your budgeted income and expenditures, you should be OK. If you have a negative balance, you’re spending more than you’re earning. You’ll need to figure out how to balance your budget (either by bringing in more income or lowering your expenses).
