What is a personal budget?
A personal budget is a financial plan that outlines your expected income and expenses over a specific period, typically a monthly basis.
Why do you need a personal budget?
It helps you track where your money is coming from and where it's going, enabling you to make informed decisions about your spending, saving, and investing habits.
A well-planned budget allows you to allocate your resources effectively, prioritize your financial goals, and manage your finances responsibly.
Check out these articles on creating and keeping a budget.
Income: The money you receive regularly, such as from a job, investments, or rental properties.
Expenses: The money you spend on various items, including rent or mortgage, groceries, utilities, transportation, entertainment, etc.
Fixed Expenses: Regular expenses that remain constant each month, such as rent or loan payments.
Variable Expenses: Costs that can fluctuate month to month, such as groceries or entertainment.
Savings: The portion of your income that you set aside for future goals, emergencies, or investments.
Debt: Money you owe, typically with interest, such as credit card balances, student loans, or mortgages.
Assets: Items of value that you own, like cash, investments, real estate, or vehicles.
Liabilities: Debts or financial obligations you owe, including loans, mortgages, or credit card balances.
Net Income: Your total income minus your total expenses, indicating how much money you have left over after covering all costs.
Emergency Fund: Savings set aside specifically to cover unexpected expenses or financial emergencies.
Budget Categories: The specific areas of spending, such as housing, transportation, food, entertainment, etc used to track and manage expenses.
Budget Surplus/Deficit: The difference between your income and expenses, a surplus indicates extra money and a deficit indicates overspending.
Looking for a budget template?
Check out these templates from Canva.
Before investing in a budgeting app check to see if there is a free option or a free trial to make sure you will use the app.
From Forbes Advisor
https://www.forbes.com/advisor/banking/best-budgeting-apps/
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