For students studying in college or university, it can be hard to keep track of our finances as many of us have been thrown into the world on our own for the first time, without a clue as to how we should manage our expenses.
Yes, we often hear the age-old piece of advice, “why don’t you just keep a budget?” but many of us may be clueless as to how we go about setting up a budget.
1. Know how much you already have
According to Bank of America, knowing how much money you already have, in this case, probably how much allowance you get per month, is the first step to estimating a sensible budget.
Be it a weekly or monthly budget, once we know how much money we currently have, we should have a basic idea of the means within which we should spend.
2. Track your expenses
One way that can ensure us that we keep within our budget is to document the amount of money we spend on a daily basis.
Since almost everyone has a smartphone these days, tracking our expenses is easier through the use of apps like Level Money, which syncs with your bank and credit card accounts so it can display how much money you can afford to spend according to your day.
3. Check in every month
Lastly, one effective way that can help us stick to the budget we’ve made is to total up all our expenses at the end of each month.
During the first month of setting our budget, we may want to do this to get a basic idea of how much we spend in a month so it can help us come up with a more realistic budget that we can commit to.
At the end of the day, it is important to remember that setting and committing to a budget takes a lot of self-control and discipline.
Budgets are not just meant for short-term usage as they can also help us organise our lives in efforts to save money for our futures.
Learning to budget is a useful skill to have because it can help college students ease into working life at a better pace as it teaches us responsibility as well as the value of a ringgit.
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First appeared on Leaderonomics.com. Published in English daily The Star, Malaysia, 23 May 2015