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What is a budget?
Learn the basic information about budgeting.
What is a budget?
A budget is a plan that helps you manage your money. It shows you how much money you have, how much money you need to spend on different things, and how much money you can save or use for other goals. A budget can help you make smart decisions with your money and avoid problems like overspending, debt, or running out of money.
Why do I need a budget?
Money is a limited resource, and you probably aren't able to buy everything you want or need with the money you have. It's important to prioritize your expenses and choose what is most important for you and your family. A budget can help!
Track your income and expenses.
Your income is the money you earn or receive from different sources, like your allowance, gifts, or jobs. Your expenses are the money you spend on different things, like food, clothes, bills, or entertainment. A budget can help you see how much money you have and where it goes every month.
Set and achieve your goals.
Your goals are the things you want to do or have with your money, like saving for a bike, a college fund, or a vacation. A budget can help you plan how much money you need and how long it will take to reach your goals. It can also help you adjust your spending habits to save more money for your goals.
Avoid or reduce debt.
Debt is the money you owe to someone else, like a bank, a store, or a friend. Debt can be a problem because it can cost you more money in interest and fees, damage your credit score, or cause stress and conflict with friends and family. A budget can help you avoid or reduce debt by helping you spend less than you earn, pay off your bills on time, and avoid borrowing money you don't have a clear plan for repaying.
Want to join the conversation?
- what is a fluid(12 votes)
- Fluid means able to be used to buy goods and services, like cash. Fluid assets are assets that can be converted into money.(36 votes)
- at what Age should I start a Job/Invest and should I have multiple sources of income?(6 votes)
- My friend, you should get as much as you can from the schooling you're in while you're young enough to enjoy it for free. If having a job means that you need to cut back on schooling before you're 18, then maybe you should not have a job. After 18, schooling starts to cost. That's when you should get a job.
As for investing... start by saving. There are lessons here about how to save and how to start an emergency fund. Until you have that emergency fund "full", you should not think about investing.
I wish you the best as you grow.(38 votes)
- Does this course provide the certificate?(1 vote)
- No. This course does not provide a certificate. You take it to learn and to grow, not to get a piece of paper.(28 votes)
- Why can debt be so hard get out of when you don't have a good paying job?(3 votes)
- OK. Let's try to respond to this in terms of the lesson on budgeting, where you've asked it (rather than imagine that you just randomly placed the question in this lesson).
We'll use the format of a geometry proof.
GIVEN: You are in debt.
GIVEN: Your job doesn't pay well.
PROVE FOR: Why it is difficult to get out of debt.
Step 1: Your job doesn't pay well.
Step 2: Your living expenses eat up all that you earn.
Preliminary conclusion: Your debt doesn't shrink.
Possible step to solution: Get higher pay at your job.
Possible step to solution: Get a better paying job.
Possible step to solution: Reduce living expenses.
Possible step to solution: Seek help outside the job / living expenses system (social services).
Possible step to solution: Seek charity.
It is clear why the debt is not reduced.
Question:
Which, if any, of the possible solutions have you tried?(13 votes)
- Do you have rules of thumb for weighing the cost vs. the benefits of going into debt? The cost can be stated in dollars and cents, but the benefit often comes down to a subjective "want" that provides a short-term joy, but regret in the longer term.(5 votes)
- I mean going into debt to buy something that only provides short-term joy is never a good idea. Maybe I've grown up in a really stingy environment, but that's how I see it.
As for the benefits of going into debt, I believe it is totally fine to go into debt if what your spending your money on will help you in the long term. Like buying a house or a car for renting or personal use.
These are just my opinions, take them with a grain of salt.(8 votes)
- How do people get in debt so easy?(2 votes)
- Many people do not want to plan things closely. Many people prefer to "hang loose". Some people hope for a lucky break, or for things to "work out" in inexplicable ways.
For many, buying some scratch off lottery tickets is more attractive than making and sticking to a budget.(13 votes)
- How can you avoid debt?(2 votes)
- Buy only what you have money for. Don't take a loan for a car, a house, a factory, farm or executive jet. Don't use a credit card, and don't subscribe to streaming services. In fact, get rid of your cell phone so that you won't be building up that kind of debt. Only use the wi-fi at the library.
By doing these things, you'll avoid debt, but you won't have much of a social life.(2 votes)
- Can borrowing money be dangerous?(3 votes)
- If you have no way to pay the money back, it can be dangerous. HOWEVER, there are things in life for which you cannot save up enough money in advance. When it's time to buy a farm, a factory, a house or a car, you may need to borrow from the bank.(6 votes)
- what are some excellent investments?(2 votes)
- I guess that will depend on how much money you have. It cannot be same for every human because it will depend on how much moeny each Individual has.
Investments is also a very broad topic, you have to come up with a specic question for a investment.(4 votes)
- Does this course provide the certificate?(2 votes)
- No. You do this course to learn something for you to hold inside of your soul, not for a sheet of paper to hold in your hand.(4 votes)