The way some people think they spend money and the way they actually spend it can be worlds apart. That's why we think it's important to have a clear (and realistic) understanding of exactly where your money goes each month.
Even though the term "budget" may bring to mind images of clipping coupons or eating ramen noodles, it doesn't have to be a painful experience. Budgeting can simply help you get a handle on how you spend money each month. And finding that little "extra" can mean a lot as you move toward reaching your long-term financial goals, like retirement.
It may be hard to figure out where to start, so below are some categories to make sure you include in your budget.
Don't forget to factor in the money you use to have fun-- dining out, travel and gifts for family and friends.
Just like a good credit score can help you qualify for a job and better loan rates, a poor credit score and excessive borrowing can have negative effects on your financial life. That's why it's important to set goals and limits and keep careful track of your monthly spending.