By TJ Chadwick
Soon we will all be out of high school and into the real world. If we have no plan for how to manage our money, then how are we going to get by on our? First of all, what is budgeting and why is it important? Budgeting is the idea of mapping out all of the money you are making and the money you are spending, to figure out where to allocate your money to make sure that you have enough to support yourself and do all of the things you want to be able to do.
Income with taxes
Insurance
Investments
Stocks and Bonds
Planning to purchase a home
Purchasing a vehicle
Emergency funds
Extra spending for activities
There are countless of things that should be included in your budget, but these are some of the biggest ones.
We know budgeting is one of the most important things to do to help support yourself, but only about 41% of Americans actually create and use a budget. Most of those who choose not to create a budget cite low income as their biggest reason. While low income may make investing in your budget more of a problem, it is not impossible to still create and maintain your budget. Saving 10% of your paycheck is a great way to start with your budget, but that number can vary to whatever works from person to person. Making a budget is not easy in any way. Getting everything you need included within your budget is a tough task. However, the benefits in the long run of creating and maintaining your budget will help you maintain a healthy and balanced lifestyle.
Works Cited
And though some of us can legitimately point to low earnings as a reason for not saving. “Nearly 3 in 5 Americans Are Making This Huge Financial Mistake.” CNNMoney, Cable News Network, money.cnn.com/2016/10/24/pf/financial-mistake-budget/index.html.Bell, Amy. “6 Reasons Why You Need a Budget.” Investopedia, Investopedia, 18 Nov. 2019, www.investopedia.com/financial-edge/1109/6-reasons-why-you-need-a-budget.aspx.
Pant, Paula. “How to Manage Your Budget Using the 50/30/20 Budgeting Rule.” The Balance, The Balance, 22 Nov. 2019, www.thebalance.com/the-50-30-20-rule-of-thumb-453922.
After reading your post, I was very intrigued by the 50/30/20 budgeting rule. This is most certainly a great idea for those going out into the real world in the near future, and learning that saving money is extremely important. The idea that saving 20% seems low, but over time, with interest, can account for a large sum of money. The concept of using a strategy such as the 50/30/20 rule is a great idea that can be used everyday in the real world.
ReplyDeleteI think that this is a very relevant blog post because money is a huge factor in life. Budgeting is essential and some people could be freaking out about not having money and how they will pay for college. But budgeting will help you so much because you have to be conscious of the money you spend. I really like the idea of every paycheck, setting aside a certain percentage of your money. If you get in that habit early on, it will help you tremendously in the long run.
ReplyDelete1/10/12- TJ I applaud you for this piece of advice. This was a helpful article to put money into perspective while we are all turning the next page in our chapter in life. College or wherever we decide to go money is a topic that we all have to embrace, most of our wants and needs have come from our parents. Thank you for putting this into perspective.
ReplyDeleteI think that creating a budget is very important in life because it allows you to know what you can spend so that you don’t overspend and screw yourself. A lot of students don’t work and don’t have money saved and then when they think of college they think that they will just take out a loan and be fine. But, I wouldn’t say you are fine when you are in the hole $80,000 coming out of college. You practically have a house payment going and it is going to be nearly impossible for you to get a car or a house or anything that you are going to need another loan for. Creating a budget and maybe not doing some of the things that sound really fun and that you want to do may be the best option and I think it is very beneficial for people to learn how to live off themselves because their parents can’t take care of them forever.
ReplyDeleteI remember talking about this is class but like most people didn't actually do anything with that information. I know it's going to be extremely important in the future when we have regular payments, regular income and have to provide for ourselves. It's going to be a lot easier for those of us that know key information about budging. Many people will find it very difficult to cut things out of the budget that are less relevant then house payments.
ReplyDeleteThis is a very interesting topic and really makes me think about how I am going to spend the money I earn after college. I always think that when I'm out of college and on my own, I am going to have so much money to spend on whatever I want, but that's not the case at all. Necessities cost so much of my total income and needs are a lot smaller. That visual you provided is great. Good piece overall, truly brings up thoughts about after college plans.
ReplyDeleteAfter reading through your piece, I came to the realization of how important budgeting is. We, as a society, live in a consumer driving world where money, in some cases, is not highly regarded to in a budget. Over spending and not correctly allocating financial resources plagues this country and may be a significant reason for why some many Americans are in debt. To discontinue with this issues a great start would be budgeting, as you said. Creating and abiding by a budget allow individuals to truly understand their financial situation while also prepping for the future. Nice Job TJ.
ReplyDeleteThis is an important topic that you have covered and before reading this I did not have much information about maintaining budget.After reading your article, I have found a lot of interesting information and how I could start saving more and become more knowledgeable about my expenses and start building up a secure budget base so that it could help me in future for my college fees and tuition. Lastly I would like to add, is that not many students know about the importance of saving up and creating a budget and I feel that nowadays students spend more money on making themselves look good and buy products like; expensive clothes, cars, expensive accessories and etc. instead of saving up for more useful things like books for college, saving up for college and etc. Schools should provide some sort of information during the grades of 7th-10th because that is the point where students can develop a sense of importance on the topic.
ReplyDeleteBudgeting is a skill that can really help out in the long run. If you don't budget well you can get into a hole that's tough to get out of. Currently in high school, I don't purchase or pay for any of my needs. Such as a house, food, or a car. I rely on my parents a lot to provide me with the necessities. I'm able to spend my money on wants and have no consequences. In contrast, as I grow older I'm going to need to provide for myself, and a big factor in being able to do that is budgeting. You need to divide your income to make sure you get what you need before you can treat yourself.
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