[ohsohappy]

Hey, as some of you may know, I am a full time college student. I just got laid off my old job, but recently got another.

What I want to know is ways I can learn to budget my income. I'm getting financial aid through the school, and as far as that's concerned, I'm not too worried.
What I am worried about is how I'm going to budget my money properly so that I can eventually get a car, and still be able to pay for books.

I don't smoke or drink, so heavy vices can be cut out, because I don't have them. I don't even chew gum or drink coffee regularly. Water is mostly it for me.

How do I learn to set a budget?

[morgaine300]

First start keeping track of what you actually do spend, every little bit of it. You might be amazed at what you spend that you don't realize. So I literally mean every little thing. And categorize it any way you choose.

Also sit down and write out what you already know, like if you have a good estimate of what you'll need for books, etc. You can also try to estimate what you spend on little things. You can also then compare what you really spent on these items versus what you thought you were going to spend. Since some things won't be spent every month, you'll have to think ahead about what those might be.

Then think ahead. How many months until you have to buy books and supplies for a new semester? When is your last paycheck prior to that date? Divide up the costs evenly over the number of paychecks. That tells you how much you need out of each check to set aside. Do this with anything you have periodically.

You may also have to think about things like clothes and that type of thing that you buy irregularly. If you can estimate, you can still divide it up evenly among all your checks and designate that amount to go towards that item.

Then with normal everyday expenses, start by using your estimates, and then by using real figures as you get them. You'll do a similar thing, but this time set enough aside to get to the next check. So even if you don't get coffee regularly, you need to include those little things like that and set enough aside to make it to the next check. Little stuff can be check-to-check.

Then take a good look at this. Are you going over your checks, or are you under? Does it vary? If it varies, you may have to take more out of some checks than others. (You'll get a feel for this.) If you aren't having anything left over, look at what you're spending and decide where you want to cut back. There's no rules about where this has to be -- different people consider different things to be the priorities, but think hard about what your priorities really are... what do you really need versus not need?

It's OK to allow yourself a little fun money. But you're the one who has to make the decision on how badly you need or want the car. The books/supplies you have to pay for, and you'll need a certain amount for clothes, gas, etc. Learn to bargain hunt to save some money. (It really won't kill you to get clothes from a thrift shop. You might be surprised what you can get there. I promise not to tell. :p) You'll learn a lot by keeping track of every dime you spend, and you'll learn where you can cut back.

You can work your budget around this. You have to decide your time horizon for a car, and how much you think it's going to be. Can you budget such that you can make that time horizon? If not, you either have to cut back something or change the time horizon. Or make more money. And don't forget repairs and such on the car. I don't know what you're looking to get, but repairs are always about 10 times what we plan for. :rolleyes:

You decide what goes where and what you want to do. Formulate your budget out of this. And then the most important rule: STICK TO IT! And keep track of it. You'll be forced into some math work. Each check you decide where it's going, and you write it down. Continue to keep track of what you're spending so you know you're within your budget for that item. Since you don't literally set aside the money in piles, this is all written down -- a spreadsheet can come in handy.

That first step is really one of the important ones: keeping track of where the money is going.

It's also good to start learning how to do this now.

I know you don't want to start divulging personal financial information, but you can always make up some numbers if you want a sort of sample of how to do this. Or PM me. (I'm an accountant - I know how to keep things confidential.)

[ohsohappy]

Thank you so much for the advise. :)
I'm going gto start saving up reciepts and whatnot from when I buy food or anything else I might need, and categorize them. That's an excellent idea. And I plan to get my new work shirts from goodwill. :)
I almost never get anything full price because I always look for sales or use a discount card. SO that helps. I don't buy clothes as much as I used to. I did put a coat on layawy though, because in MN, it get's pretty chilly and my other coats are just in really poor condition.

As for the car, I'm just trying to get a used one that doesn't need immediate repairs and gets me from A-B, with heating that works, I don't 'much care about AC, it's freezing anyway.

SO, as soon as I start my new job, I'm going gto try and keep track of how much I earn. I always keep my pay stubs too, so that helps.

Maybe keep it on a document on my computer so I don't loose it.

Anyway, this advice was really helpful. Thank you. :)

[morgaine300]

You're welcome. And good luck on that car.