Importance of a Budget

Although it's hard to resist the urge to blow the thousands of dollars of student loan money sitting in our checking accounts on booze, clothes, some cute boots, and McDonald’s, we do need to remember the items necessary for the every day life of a college student.  Part of becoming a financially independent adult is knowing and understanding how much money you have and where it is spent.

Reasons to budget:

·         Give yourself control

o  A budget helps resist impulse purchases and overspending

·         Prepares yourself for emergencies

o  Planning ahead could help you when you least expect it.  Having the extra money in your budget in case your car breaks down, you need medical attention, etc., is a good feeling.

·         Improves bad spending habits

o  With a limited budget, you become a more price conscious shopper.  It will also show you how to pay more attention to the consumption of resources in your home (electric, water, gas, food, etc.)

·         Reduces stress

o  A budget provides you with the peace of mind that your financial situation is under control.  It’s an extremely unsettling feeling not knowing if you can afford to pay your bills.

To learn more about budgeting and how to create a budget worksheet, you can visit my website, College Life, for more information.  In my article, “How to Make a Budget”, I discuss in more detail the steps you should go through in the process of creating a budget.  Feel free to leave suggestions if I missed anything important!