Creating a budget- a budget is a tool used to tell your money where to go instead of wondering where it went.
To start off, I would look back through your past couple of months expenses and income to get an idea of how much you take in and how much you have outgoing.
Then you can start plugging in the numbers onto a sheet of paper or a budgeting app, like every dollar. You want to start by taking care of the four walls: housing and utilities, food, clothing, and transportation.
After you have those planned out and taken care of you can start plugging in the numbers for how much you plan on spending for dining out, fun money, Netflix, bills, and miscellaneous. You want to make it a zero based budget, which means you are specifically telling all of your money where to go and what to do.
Also take note that your budget will not be the same month to month. You need to make sure to go through and update it as needed. Like you don’t need to allocate money every month to haircuts or anything like that. You don’t need to set aside money for oil changes every month. So remember to keep your budget updated.
And in your budget you need to make sure you have a line in there for saving to build up your emergency fund.
Building your starter emergency fund- your starter emergency fund is putting away $1,000 incase Murphy comes a knocking. If you make less then $20,000 then I would recommend only saving up $500 for your starter.
You want to get your emergency fund started as soon as possible. I can not tell you how many times I’ve been so thankful that I’ve had money set aside for when the unexpected happens. I have had to buy new tires, new batteries, and other random expenses for the car. I’ve come to the conclusion that cars are just black holes for money.
If you need to, pick up an extra job or start your own side business. Get the emergency fund taken care of as fast as you can.
Search savings challenges on Pinterest, you will find so many different savings plans.
Some examples are saving every $5 bill you get (need to use lots of cash for this to be affective). Another one is to put $84 dollars every pay check, that one will build your emergency fund in 12 pay periods.
These are just the beginning steps of creating the life you want. You can do this, I believe in you.