When it comes to money, it’s helpful to know much you need on a day-to-day basis. That’s where a monthly budget comes in.

Start by deciding how you want to track your budget. You can use an app/website; a spreadsheet; or pencil, paper, and calculator.

Examples of budgeting apps are countabout.com and YouNeedABudget.com. Your bank or credit union may also have a budgeting tool.

Budgeting is all about balancing what comes in and what goes out.

Think about and list all the money you have coming in: income from jobs or side hustles, allowances, financial aid refunds.

Next, think about all your expenses. Many budgeting apps can be connected directly to your bank account and/or credit cards to track that info for you.

When money’s tight, it’s hard to think about saving. But saving any amount is significant.

The best way to save is to automate it―set yourself up so that money goes to your savings without you having to think about it. Here are some ways to do that:

• ask your employer to direct deposit part of your paycheck to another account
• set up an automatic transfer to savings on payday
• if your checking and savings are at different financial institutions, check your online banking to see if either one has an “external transfer” option.

Your starting point is this basic equation:
Your monthly balance = your total monthly income – total monthly expenses.
If you have money left over, congratulations! Put more into your savings account & create an emergency savings fund.

Expenses greater than your income? It’s a tough place to be, but also really common.

Look for places in your budget where you can reduce expenses. Shopping and food expenses are often more flexible and can be good places to start. Here are some more cost-cutting ideas

Of course, you can also look for ways to add more income:

• Any financial aid or scholarships you can look into?
• If you already have a job, can you increase your hours?
• Can you take on odd jobs here and there?

Compare your budget to your behavior.
This is the central idea of budgeting, so let’s dig in with an example. Let’s say you spent more on takeout last month than you budgeted.

• Do you need to think of ways to cut your takeout expenses so it doesn’t happen again next month?
• Or do you need to say that your budget wasn’t realistic and you need to allow more space for takeout?
• Or a combination of both?

Budgeting’s an ongoing process. Ideally, you should review your budget every month, but if you can’t, that’s okay. Just do it when you can.

Remember that reviewing your budget means you’ll do two things:

• decide which expenses to reduce to be in balance
• reorder your budgeted expenses to match your reality

You’ll be a budgeting wizard before you know it.