Do you have a budget? Even for the type As among us, budgeting comes naturally to few. It may not be your idea of fun, but it’s also one of the most valuable skills any young woman will learn.
Budgets are Important
Budgets are an essential tool that will help you manage your expenses and save for the future. Without a clear view of where your money is going, you could quickly find yourself knee-deep in debt. As one young professional describes:
For years in college, I felt that my spending was out of control, and I would have months where I had no idea what I spent. When I studied abroad, I once overdrew my bank account for weeks at a time without noticing. I decided to rein it in, and now feel a lot more in control of my financial situation.
Even if you aren’t in debt, you may run into a problem that’s harder to spot: not having enough money set aside for a rainy day. My rainy day came in the form of a serious bike accident, which sucked up several thousand dollars worth of savings (after what my rather good insurance covered!) and took a year to recover from. It was one of the most difficult experiences of my life—but you can only imagine how much worse it would have been if I hadn’t had money set aside.
Even outside of a crisis, having a budget is important. “Budgeting means to me that I am in control of my life,” explains another young woman. “I know exactly where my money is going. I know when I can buy something and when I should hold off. I feel secure and comfortable.”
Knowledge is Power
Budgeting doesn’t have to mean cutting back. It just means actually knowing where your money is going. You may be surprised to find that you spend over 5% of your salary at Starbucks, or that you only save $15 a month when you thought you were saving closer to $100. As the old adage says, knowledge is power. Seeing what you spend your money on often makes you reconsider whether that’s in line with where you really want your money to go.
But it’s probably no surprise: you already knew that you should be making a budget. But actually getting started is often the hardest part.
So, The Daily Muse has put together quick and easy-to-use tool to help you take the first step: download The Daily Muse Budget Tool, and you’ll have both a budget and clear path forward in no time (Note: It took only took our editor 15 minutes to complete!)
We’ve set up The Daily Muse Budget Tool to:
1. Offer step by step instructions for you to enter your yearly savings goal and a monthly estimate of what you spend
2. Show you how your spending splits across categories (e.g., housing, food, transportation)
3. Compare your spending to our recommended budget, so that you can see where you over- or under-spend
…all in 15 minutes!
So what are you waiting for? Click here to get started.
And Keep Coming Back
Don’t forget about your budget once you make it: budgets are living documents. Record your expenses, set goals, and go back to see how you are doing. You can make adjustments, too—either in the budget (to make it more realistic), or in your spending (to stay in line with your goals).
The most important thing is: get started! Once you’re comfortable with making a budget, you can think about changing categories to reflect your spending habits or trying different ways of tracking your expenses. For example, Mint and LearnVest also offer budgeting tools popular among young professionals. Whatever you choose, just make sure it works for you, or else you won’t use it regularly.