How I Make My Budget.
Hello Hivers! I trust the new week started off great for all of us? ๐.
Well, it's another week for the @hive-learners posting topics and for this edition, we're discussing the topic of โBudgetingโ.
Now, I'm certainly no geek when it comes to finance. Matter of fact, it's just not my flair and I most times tend to shy away from "finance" related convos ๐. However, I'll be seizing this opportunity to chip in my little knowledge ๐ค.
One thing I do know is that Budgeting is one of the important basics of financial knowledge. Every financially literate person should by now understand what a budget is, how to create it and the factors considered in creating one. Before I share how I make my own budget, let's quickly refresh our minds on the meaning of Budget, shall we?
A Budget is simply the amount of money or resources set aside for a particular activity or period of time. It is a money plan that helps us track our income and expenditures. Lack of proper budgeting could lead to impulse buying and unaccountability.
It is necessary for one to have a budget so as to not be caught off guard by the question; โwhat is your budget?โ. You might need to make a budget for your purchases such as buying a house, renting an apartment, shopping, etc. As a student, I've had to make budgets as well. You see, whenever I receive monthly allowance (pocket money) from my Dad, I usually create a budget to account for my expenditures. How? ๐คจ
First, On my journal, I write down the total amount of allowance received for the month.
SOURCE Then, I write down my regular expenditures and their costs for the month. These expenses include feeding costs, transport costs, airtime costs, etc. After calculating the total cost, I keep the specified amount of money aside.
Afterwards, I write down my needs and their costs. For instance, if there's something important that I really need to buy like sanitary towels, books, stationary, repairs of torn shoes, and other emergency stuff. I keep some money aside for it.
Lastly, whatever amount is left of my allowance will be used for my wants and enjoyment ๐. I believe there are three major factors affecting budget and they must be put into "due consideration" when budgeting. They include;
- INCOME.
Without a doubt, our income determines our budget. One can only control expenditures based on the amount of money received whether daily, weekly, monthly or even yearly. So, when setting my budget, I always look at the money I have so as to ensure a balance.
- INFLATION/RECESSION.
The economic state of the country as well as the price of goods, products and services should be considered when making budget. When the value of money declines, our budget tends to rise. When it stabilizes, our budget lowers. Putting this into consideration enables me create a realistic budget.
- NEEDS.
When making my budget, I ensure to identify and prioritize my pressing needs first as they are the essential part of any budget. And it enables me to spend wisely and maintain a focused goal.
Conclusively, the truth is that budgeting requires self-discipline. It is one thing to create it and another to actually act on it. Sometimes we're too tempted by our fleeting wants that we forgo our needs and end up surpassing our laid down budget. And at the end of the day, we're only left with feelings of regret and an empty pocket.
I hope you also find this helpful to your own use and understanding ๐.
THANKS FOR READING! โค๏ธ
