What is a Budget, and Why is it Important?
A budget is a useful tool that helps you manage your expenses in proportion to your income. By budgeting, you can differentiate between your wants and needs and spend accordingly. Having a balanced budget is crucial as it ensures you don’t end up spending more than you earn. Balancing a budget is considered the most fundamental skill in personal finance, which makes it very important.
Steps to Manage a Budget
1. Create a one-month estimated budget
2. Track a month of actual budget income
3. Track a month of actual budget expenses
4. Compare the two budgets (Estimated vs Actual)
- What did you notice about how much you’re spending compared to how much you earn?
- Where do you think you can change your spending so that you can save a little bit each month?
6. Begin to track and adjust as needed

Financial Wellness Roadmap
Want a step-by-step guide to learning the foundations of personal finance on campus? Be sure to check out the Financial Wellness Roadmap. If you have any questions about the Roadmap, or anything else related to finance, be in touch with Smart About Money and someone will get back to you right away.