Introduction Learn how to create a personal budget.
Directions Read the information below and apply what you learn to answer the questions. Key your answers into the spaces below. After you finish keying, check your work carefully and click Submit.
Create a Personal Budget Although your parents probably take care of many of your financial needs now, it is never too early to learn how to budget your money and follow a clear financial plan.
Evaluate Your Financial Goals Before you create your budget, you need to know what your financial goals are. First, think about what you plan to spend money on. Is it for frequent small purchases, like fast food, movies, and CDs? Perhaps you are saving for a large purchase, such as a car. Or do you need to pay monthly expenses like your phone bill or car insurance?
Second, you much consider how long it will take you to achieve your goals. For example, are you saving for college in four years? Or do you just need enough for gas at the end of the week?
Your financial goals will change throughout your life, but it is important that you consistently reevaluate them. Remember that your goals should always:
Follow a Budget After considering your financial goals, you must determine how much income you have to spend on those goals. It is also very important to save some of your money, no matter how small the amount. Try saving 1 percent of your take-home pay or allowance the first month, 2 percent the second month, and so forth. At the end of the year, you will be saving 12 percent.
Use the following tips to make sure you stay within your budget:
If you find it difficult to stick to your budget, go back to your financial goals. Remember that being financially responsible will help you reach those goals.
Find Information on a Web Site CNN Money (money.cnn.com) has an excellent tutorial on financial planning called Money 101. If you need to find out more about this topic, get your teacher’s permission to use a search engine. Here are some keywords you might use: personal budgets, personal finance.
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