Pop quiz: How much money did you spend last month and on what? Sure, most of us have a rough idea how much we paid for the basics, such as utilities, groceries, rent or mortgage. But do you know how much you spent -- down to the penny -- on little things, such as coffee, dining out, movies or drinks after work? Have you ever taken the time to keep a running tally of everything you shelled out cash for or charged to a credit card in a week, month or even a year?
"It's eye opening the first time you do it to see how much you're spending," says Jim Blankenship, a Certified Financial Planner in New Berlin, Ill. But it's also a first step toward greater wealth. If you're just starting out, it's imperative that you create a formal budget to track your expenses. Once you're older and know where your money is going, it might not be as important to have something on paper, Blankenship says. But you still should track your spending so you can revise your budget if necessary, especially if you have debt.
"Budgeting is the foundation of all your financial activities," he says. "If you don't have the foundation in place, you're building something that's structurally unsound." In other words, if you don't know where your money is going, you won't be able to meet your goals -- whether it's paying off student loans, buying a house or saving for retirement.
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With that in mind, the stories below will guide you through every stage of life. They will help you create a budget if you don't already have one, give your existing budget a check-up, find extra money each month to pay off debt or save, and tailor a budget to ensure you won't outlive your savings in retirement. Take a look:
BUDGET BASICS
Think of your budget as a means of setting and reaching your goals. Here's help to get you started.
Take the time to find out where your money is going on a day-to-day basis.
Dwindling savings and more debt are warning signs of a leaky budget. Find out how to keep spending under control and keep costs down.
If you start picking up distress signals, run your budget through these checks.
WHEN YOU'RE STARTING OUT
Budget Basics for College Grads
Here are some suggested spending guidelines and tips on tracking where your money goes each month.
Heading out into the real world? Don't walk blindly. We show you how much life's expenses typically cost to help you anticipate your finances and build a budget.
BUDGETING TO SAVE
A big reason to budget is to figure out how much money you can set aside -- for emergenices, college or retirement. Here are ways to find extra money in your budget to sock away.
Your bills are covered and you've got cash left over. What to do? Pay off that high-interest debt first.
THE FAMILY BUDGET
Explaing the Budget to Your Kids
With so much taken care of for them, it's not surprising that children can't appreciate what it costs to keep a household running.
BUDGETING IN RETIREMENT
We outline the six vital steps, including how to set a budget, you should take to guarantee you'll never outlive your savings in retirement.
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Strategies to Optimize Your Social Security BenefitsTo maximize what you can collect, it’s crucial to know when you can file, how delaying filing affects your checks and the income limit if you’re still working.
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Don’t Forget to Update Beneficiaries After a Gray DivorceSome states automatically revoke a former spouse as a beneficiary on some accounts. Waivers can be used, too. Best not to leave it up to your state, though.
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403(b) Contribution Limits for 2024retirement plans Teachers and nonprofit workers can contribute more to a 403(b) retirement plan in 2024 than they could in 2023.
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Roth IRA Contribution Limits for 2024Roth IRAs Roth IRA contribution limits have gone up for 2024. Here's what you need to know.
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7 Things Medicare Doesn’t CoverHealthy Living on a Budget Medicare Part A and Part B leave some pretty significant gaps in your health-care coverage. But Medicare Advantage has problems, too.
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Four Tips for Renting Out Your Home on Airbnbreal estate Here's what you should know before listing your home on Airbnb.
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Five Ways to a Cheap Last-Minute VacationTravel Procrastinator? No matter. You can pull off a fun and memorable getaway on a moment's notice — without breaking the bank.
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How Much Life Insurance Do You Need?insurance Instead of relying on rules of thumb, you’re better off taking a systematic approach to figuring your life-insurance needs.
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When Is Amazon Prime Day?Amazon Prime In 2023 Amazon had two Prime Day events — one in July and another, called Big Deal Days, in October. We expect 2024 to follow the same schedule.
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How to Shop for Life Insurance in 3 Easy Stepsinsurance Shopping for life insurance? You may be able to estimate how much you need online, but that's just the start of your search.
