Every great financial plan starts with a solid budget, sis. Whether you’re trying to pay off bills or save for a dream vacation, a budget is your first step toward making your financial goals a reality. For people with all types of finances and expenses, budgeting is a proactive approach to organizing your finances. 

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Before you begin to make your budget, it's important to provide as much detailed and accurate information about your financial situation as possible. That way fam, your new budget will successfully show you where your money is coming from, how much is there, and where it's all going each month. Here's how to make your first budget:

1. Calculate your income

Your total take-home income, sis. This means your after-tax pay for both you and, if you're married, your spouse. Don't forget to include everything — full-time jobs, second jobs, side hustles, freelance pay, Social Security checks, and any other sources of income.

2. Create a list of monthly expenses

Write down a list of all the expected expenses you plan to do over the course of a month. This may include your mortgage payment, apartment rent, car insurance, groceries, utilities, turn up funds, shopping sprees, student loans — basically, everything you spend money on.

Then, separate your expenses into two categories: fixed and variable. According to Well Kept Wallet, fixed expenses are those that stay pretty much the same each month and are required parts of your way of living. For example, your rent, car payments, cable and WiFi service, credit card payments, etc. Whereas, variable expenses are those that will change from month to month. For example, your groceries, gas, turn up outings, shopping sprees, etc. This will be important when making adjustments.

3. Subtract expenses from income to equal zero

As Investopedia reports, this is called a zero-based budget because your income minus your expenses should equal zero. If your end result shows more income than expenses, you are off to a good start sis! This means you can prioritize and focus towards other areas of your budget, like paying off your credit card, to eliminate that debt faster. But fam, if you are showing a higher expense column than income, it means some changes will have to be made. PeriodT. 

4. Track your expenses

With your budget set up, now you'll need to stay on top of your expenses. Record your spending, or use apps like Everydollar and PocketGuard to make tracking easy as Sunday morning. 

5. Revisit your budget If Needed

Your income, expenses and priorities will change over time, fam. And that's totally fine! Adjust your budget accordingly, but the most important thing is to always have one. 

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