Budgeting is a foreign word to almost everyone, but especially teens. Budgeting requires discipline and know how to be successful. Preparing a budget is similar to learning a new language. First you learn the vocabulary then the grammar and finally you learn to speak by practice. What is the vocabulary, grammar and how do I practice? Let’s keep this simple! The first step is to determine your financial goal. For example, you want to have $500.00 saved by Christmas. This is starting with the goal or outcome in mind. Is the goal reasonable? If it is, how much can you put aside each week to meet your goal? The easy method is to take the number of weeks to your goal and divide it into the goal amount ($500). Is this a reasonable amount per week? This is the beginning of budgeting. How can you change your spending habits to make these savings routine and achievable?
Review your spending habits, where do you spend your money? What changes can be made to reduce your spending to achieve your goal? If you buy your lunch each day, can you bring your lunch? If you are constantly buying soda and snacks, can you bring your own snacks? If you can, give up a certain purchase such as soda. If you go to the shopping mall for fun and to meet friends, limit your purchases. This is the discipline side of budgeting. That is why I start with your goal! Your goal should create the motivation to make changes in your spending habits. It should give you the will to make those hard choices to reach your goal. Budgeting is not easy, if it were everyone would use it and everyone would be more successful. If you like this article and find it valuable and useful, please subscribe.
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