“GET REAL… with your budget!”

A lot of us are spending more than we make in a month, purchasing items we can’t afford, and will be paying on these items for years to come. We are spending money we haven’t even earned yet, and if we continue in this habit, we will never catch up! So we must start the good habit of setting a budget and sticking to it. We need to be good stewards of what God has blessed us with and also be prepared for financial emergencies that may arise. But the initial step is creating a REAListic budget.

Step 1 – Track your expenses for one month and summarize them in the following categories: Housing, Transportation, Food, Healthcare, Loan repayment, and Other. This is the starting outline for your budget. Compare your total spending to how much you earned during the month. Begin trimming unnecessary expenses where you can.

Step 2 – Determine the percentage of spending for each category (divide the amount in each category by the total spending for the month). Compare your budgetary percentages to those in the pie chart across. Use the pie chart as a guideline as your redistribute and reduce your total budget.

Step 3 – In a realistic manner, trim those final expenses so that your spending is below your monthly income (leave room for saving). Remember that your budget is not etched in stone. Some months you may have to spend a little more in one category, but try to offset that by spending less somewhere else.

Remember to review your budget on a regular basis. The more you do so, the better chance you will have at sticking to it. Then your budget will not be a sad attempt to control your spending but will be something REAL that you live in to.

twimsArticle by Tamara Wims, chairperson for the Conference Young Adult Council, member of Mid-Town Parish UMC of Philadelphia, and accountant for the Eastern PA UMC Conference Office. This article was first published in the Summer 2014 issue of THE PRESS, a Young Adult Newsletter.