1. Budgeting Basics

2. What is a Budget? A budget is itemizing your income against your expenses for a given period. A budget allows you to better visualize your financial picture.

3. How does a Budget Help Me? Stay out of debt Save for the future Attain goals Trim spending Relieve Stress Lifelong money management skills

4. BUDGETING 101 The first step is to know how much money is coming in so you know how much money you can spend.

5. Budgeting Basics Determine WANTS vs. NEEDS Determine your goals –Short term –Long term Do the Math

6. Budgeting: Easy as 123 Step 1: Add up all of your income Step 2: Add up all of your expenses Step 3: Calculate the difference

7. Common Budgeting Questions Converting Annual expenses/income to monthly amounts –Divide the annual income or expense by the number of months –Ex/ Car insurance paid every 6 months: Divide that amount by 6 to get monthly expense –Ex/ Receive graduation gifts of $500, spread it out over school year: Divide $500 by 9 months

8. Common Budgeting Questions Converting monthly expenses/income to annual/semester amounts –Multiply the monthly expense income by the number of months –Ex/ $70/month for cable and internet. Multiply $70 by number of months

9. Common Budgeting Questions Income and Expenses change during the summer –Create a separate summer budget –Spread out savings from summer job throughout the school year Ex/ Save up $3000 during the summer: Divide by 9 months to get monthly budget –When calculating yearly budget, don’t multiply monthly expenses by 12 if you will not have those expenses year round Ex/ $70/month for cable and internet, but cancelling for summer months: only multiply $70 by 9 months

10. Budgeting Tips Everyone’s budget is going to be unique, so add, remove, or change any of the budget categories Be conservative with your estimates When in doubt: »Overestimate expenses »Underestimate income Start an emergency fund

11. Assess Goals and Expenditures Do your expenses exceed your income? –Bridge the gap by trimming down your spending –Pick up a part-time job –Take out more loans –Use credit card to cover any short term gaps Do you have money left over after covering your expenditures? –Attain goals faster, make new goals –Start paying off student loans, invest for the future, save for a summer trip

12. Money Munchers ATM FeesComputerware Home PartiesCosmetics Online Services Beauty Parlor Over the limit fees Cell phonesDatingIce CreamParking Fees GiftsOverage Fees Bottled WaterBounced ChecksClubs CigarettesGreeting Cards TanningHaircuts Movies Cable TVLate Payment Fees Dinners OutBar Night Books Fast Food Attacks Dry CleaningCar Wash Lottery Tickets MagazinesMovie RentalsSports Lunches Out Gambling CD’s/Music Downloads Prescriptions Household Items Pet Costs Licenses Speeding Tickets Cash Advance Fees Munchies GiftsSouvenirs

13. Track Spending Track your spending each month Compare to budgeted amounts