You’ve finally received your first paycheck from your part-time job, and you’re excited to have money of your own. You grab food with friends, do a little online shopping, and treat yourself — but suddenly, you only have $5 left in your account.
You may find yourself asking, “Where did my money go?”
If this situation sounds familiar, it might be time to create a budget. Building a budget helps you take charge of your money and your money goals. It allows you to develop healthy spending habits, reduce financial stress, and gain greater awareness and control over how you use your money.
To Buy or Not to Buy
A fundamental part of creating a budget is understanding the difference between needs and wants.
- A need is something necessary for basic living.
- A want is something that makes life more comfortable and enjoyable, but you could
live without.
Learning to distinguish between the two helps you live within your means and avoid overspending. Before creating your budget, start with a “game plan.” Ask yourself whether an item is essential or something you could live without. For example,
- Could you be successful in school without your textbooks? If the answer is “no”, that
expense would be considered a need.- Do you need the latest TikTok shop outfit? If the answer is “no”, that expense would
be considered a want.Understand Where Your Finances Stand
Before building a budget, it’s important to understand your current financial situation. Start by asking yourself: “Where is my money going?”
Tracking your spending can help you find the answer. Review your spending by looking at your bank statement and transaction list from the past one to three months. Then organize purchases into categories such as needs and wants.While reviewing your expenses, look for subscriptions or services you no longer use and cancel them. Small recurring charges can add up quickly. Once you understand your spending habits, you’re ready to begin creating your budget.
Building Your Money Game Plan
There’s no single “right” way to budget — the best method is the one you’ll actually stick with. Here are several ways to track your spending and build a budget:
- WPCU Teen Budgeting Worksheet: Fill in your monthly income and expenses, then
keep a running list of your purchases. Compare your spending to your budget
regularly. This option works well if you prefer tracking your money offline.
- Envelope Method: Label three envelopes: Needs, Wants, and Savings. When you
receive money, divide it among the envelopes. Once an envelope is empty, spending
in that category stops for the month. This method is especially helpful for managing
overspending and works best when using cash.
- Budgeting Software or Apps: Many apps allow you to track spending by entering
purchases manually or linking your accounts for automatic updates. This is a great
option if you already use online or mobile banking.
- Spreadsheet Budgeting: Spreadsheets offer flexibility similar to a paper budget but
allow for automatic calculations and easy customization. This option works well if
you enjoy organizing and updating your budget digitally.
- Schedule Time with a Financial Coach: A Financial Coach is here to help! With a
Financial Coach you can set goals, build a budget, and stay on track. Having regular
check-ins can keep you accountable and help you adjust your plan as needed.
o Schedule An Appointment Online: https://www.wpcu.coop/
WPCU Pro Tip:
Use the Money Management Tool available through Mobile and Online Banking with Wright-Patt Credit Union® (WPCU®). This free service allows you to view all your financial accounts in one place, track spending, create budgets, and set financial goals.
.Haylee Jackson
She/Her
Community Development Coordinator
Wright-Patt Credit Union, Inc.
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