Want to see where your finances goes monthly? Alright. Now the idea of Creating a monthly budget might sound intimidating at first especially if you’re just starting out. But the truth is, a budget doesn’t have to be complicated—it just has to work for you. Whether you’re trying to save more, get out of debt, or simply stop living paycheck to paycheck, building a budget plan for beginners is the first step to gaining control over your money.
By the end of this article, you'll learn how to create a budget that’s simple, realistic, and actually helps to meet your financial goals.
Does Budgeting Matter? Yes it does! A good budget shows where your money goes, helps reduce financial stress, and guides your spending habits in the right course. Like some may think, a monthly budget especially for beginners isn’t about restricting your whole life—rather it’s about giving your money a purpose. Without a plan, it’s easy to overspend, forget bills, and end up saving too little or nothing.
Below are 4 steps you can follow to take accountability of your finances starting from today.
Step 1: Calculate Your Monthly Income
The first step in any budget plan is knowing how much money you have coming in. This includes:
Your salary (after taxes)
Side hustle income
Support or government benefits
And any other consistent income sources
Make sure you’re calculating net income that is what you take home and not your gross pay.
Example: If your job pays you $2,800 after taxes and you earn an extra $200 from your side hustle, your total income is $3,000/month.
Step 2: List All Your Expenses
Write down your regular monthly expense and break them into two categories:
A. Fixed Expenses (stay the same every month):
Rent or mortgage
Car payment
Insurance
Subscriptions
B. Variable Expenses (change month to month):
Groceries
Utilities
Gas
Entertainment
Dining out
Don’t forget irregular or seasonal expenses like gifts or car maintenance—either average them into your monthly total or create a separate category.
Step 3: Set Spending Limits
Now that you know how much you're earning and spending, it's time to decide how much to allocate to each category.
Start with the necessities:
Rent: $1,000
Groceries: $300
Utilities: $150
Transportation: $150
Then allocate for savings and extras:
Savings: $300
Entertainment: $100
Dining Out: $100
Your goal here is to spend less than you earn and adjust these numbers to make room for saving or paying down debt.
Pro Tip: Use the 50/30/20 rule as a guideline:
50% needs
30% wants
20% savings/debt repayment
Step 4: Track Your Spending
A budget is useless unless you track your expenses. They are some budgeting apps that you can use (like YNAB, EveryDollar, or Mint), a spreadsheet, or even a notebook to log every dollar you spend, this helps you Stay accountable with your income.
And always check your budget at least once a week
Now after your first month as beginner, you should go through your budget plan and see if there are any area you overspent or any category you need to readjust or cut down on.
Remember when tweeking your budget, always do it based on your real-life spending. Over time, your budget plan will become a personalized system thereby helping you become financially stable.
Bonus Tips to help you Stick to Your Budget so you always get to save before spending.
Avoid impulse buys—wait 24 hours before big purchases.
Meal plan to save on food.
Unsubscribe from shopping promo emails.
Final Thoughts
Learning how to create a budget doesn’t require a financial degree. It just takes a little time, honesty, and consistency. The more effort you put in now, the more freedom and peace of mind you’ll have later.
The key is to Start small, track your progress, make necessary adjustment where's needed and before you know it you should have your finances in order.
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