https://www.completecontroller.com/wp-content/uploads/cclogo_main-long-300x63.png 0 0 Complete Controller https://www.completecontroller.com/wp-content/uploads/cclogo_main-long-300x63.png Complete Controller2017-07-10 09:30:082017-10-31 17:07:35Millennial Budgeting 101- 8 Easy Steps to Make a Budget
In this article, we will discuss 8 easy steps to creating a budget for the average millennial that is easy to manage and easy to understand.Budgeting and finances are easily the most unpopular topic of discussion, we get it. Unless you are trained in the art of financing, this concept can seem incredibly daunting. We’re here to let you know that it doesn’t have to be that way. Anyone who has a smartphone has access to hundreds of free or paid budget apps. These can be extremely helpful and easy to understand. We recommend following these steps before downloading one of those handy apps. This way, you have all of your information in front of you, making it easier and more efficient to walk through these apps. We recommend using excel or another similar system to record everything. This way, everything is aligned, neat, and on one page.
1. List everything you owe.Most Americans owe lenders in some form or another…if not many! Make a list of all of your debt:
- Who do you owe?
- How often do you make payments? (generally monthly)
- What is your minimum monthly payment? (if you pay more than the min-write that)
- If you want to go the extra mile, include what your interest rate is on each of these loans. It’s important to stay aware of these as they may fluctuate. Also, this is important to know if you are considering refinancing.
- When are they due?
2. List your monthly expenses.Everyone has monthly subscriptions, expenses, and/or ‘dues.’ Write them down by name, what the monthly payment is, and the day they are due. Rent → $X/Mo → due XX/01/2017 Utilities → $X/Mo → due XX/01/2017 Subscriptions (such as streaming or news subscriptions) → $X/Mo → due XX/01/2017 Gym Membership → $X/Mo → due XX/01/2017
3. Add your monthly debt & expenses.Add these two numbers together- place it at the top. This is the chunk of change you will be expecting to pay every month.
4. List your monthly income.Write what your monthly income is. If it fluctuates, look at the past 6 months, add them together, and divide by 6. This is your mean income. This goes at the top of your list.
5. Categorize your spendings.This is probably the most time consuming but, undoubtedly, the most important step. Take a look at the last 3-6 months of your spending habits. Jot them down into categories and what their totals are. Example:
- Gas → $X → July/17
- Groceries (food items only if you can) → $X → July/17
- Going out to eat → $X → July/17
- Shopping → $X → July/17
- Beauty products/vanity* → $X → July/17
6. Face the facts.At this point, you are either patting yourself on the back or sobbing. Personally, I had to pick my jaw up off the floor. If you’re patting yourself on the back, great! You have officially graduated from Millennial Budgeting 101- now go put all of that extra cash in a savings account! If you’re like me and you’re still struggling to comprehend your ridiculous spending habits- it’s time to reevaluate, reevaluate, reevaluate! Do you really need Hulu, Netflix, HBO, and Cable TV? I suggest giving cable the ax. Get rid of the stuff you don’t need. And, stop buying things you can’t afford or don’t need.
7. Make your budget.Now that you have the numbers in front of you and you’ve gotten rid of the things you don’t need, it’s time to set budgets. Remember, the goal is to save money every month. Every category needs to have a cap and you need to stick to that cap. Obviously, your monthly car payments and rent aren’t going to change, but I’m talking about those other spendings.
- Income = X
- Expenses = X
- Gas = X
- Groceries = X
- Going out to eat = X
- Shopping = X
- * Remember this is ALL you’re allowed to spend each month*