Personal Budget

Having control over your finances is important not only for your financial well-being but for your peace of mind as well. You can have control of your money by making a budget. This not only makes you aware of your expenses but also allows you to save more money for your financial goals, whether they are short-term or long-term.

Here are three things to get started with creating your personal budget.

Set your goals

First, know what you want to accomplish over the short or long term and know which goals are your priorities. Then you can start planning on how to achieve them and when you should achieve them. Your short-term financial goals may include paying off your credit card debt or saving for holiday presents, which you can achieve in less than a year. On the other hand, long-term goals such as retirement savings may take years to reach.

Know your net income

To create a budget, you should also know how much your net income is. Your net income is the money you have per month, less the deductions for social security or taxes. That’s the money or budget that you can work with.


Determine how much your fixed or non-negotiable expenses are. These are expenses that stay the same per month such as your mortgage, insurance premiums, car loans, etc. How much is left is the money you can use for your variable expenses such as entertainment, utility and gas. Doing so gives you an idea on how much of your money you spend on your needs which constitute your cost of living, and how much is left to save.

The good thing about creating a budget is that you can customize it according to your personal needs. After determining your fixed expenses, you can change the amount you set aside for variable expenses and prioritize as you see fit.