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Preempting
the New Year’s Resolution Madness
#3 Stick to a Budget
By Kayla Lemar
Teen Scribe
So it’s month number three in our journey to preempt the New Year’s
Resolution madness. What’s up next? How to stick to a
budget.
There’s really no good reason not to live on a budget—not for anybody,
no matter what age, unless you’re Donald Trump.
Why? Because unless you found gold while diving in the South
Pacific, everyone has a limited amount of money, and has to live within
their means. This is called reality. And believe me, I hate
it as much as you.
When I was little I thought budgeting was silly because I was going to
be a lawyer or a rock star or one of those high-end crime scene
investigators from CSI, making lots of money, and I wouldn’t have to
worry about it.
Instead I’m doing something I love: teaching daycare. But I don’t
have Donald Trump’s salary, and it’s likely I never will, unless I
write a savvy daycare curriculum for baby geniuses. It’s probable
you’ll be like every other human on the planet: someone who works their
way up the ladder, from little to big. So budgeting is a good
idea, even now.
Dream big, and while you’re at it, prepare for that dream.
I used to think budgeting was about denying yourself every possible
pleasure in order to save money. No Play Station game because I
needed that money for college. No McDonald’s sweet tea because I
need that dollar for the car I might buy in five years.
But budgeting is not about self-denial or starving yourself of
pleasure. It’s true, if we lived in boxes on the sidewalk we
wouldn’t owe a mortgage or utilities; we could save a lot of
money. That doesn’t mean we should live in boxes on the sidewalk.
Budgeting is more about considering what your needs are, what your
wants are, and then choosing what things are most important to you in
life, things that bring you the most pleasure, so that you don’t waste
your money on frivolities and never have what you really want.
And guess what? Budgeting is easy, especially if you start when
you’re young.
Here’s what you do:
1- Buy a $1.00 notebook. Consider
it an investment to living a financially healthy life. Or use a
journal page if keeping it in your special thought space will keep it
on your mind. Old notebooks lying around save money.
2- Write out how much money you make in a
month. Do you have a paper route? Pack eggs on Grandma’s
farm? Wash cars or sell candy bars? Maybe you’re even old
enough to have a job at McDonald’s. Good, right that all down.
3- Make a list of all the things you
need. Sometimes you can choose your needs, like buying a car and
then needing to pay the loan, but other things you need because you’re
human, like food. Your parents probably still buy your food and
clothes. If not, right down all of those needs, plus the current
obligations you have. Not, “I need a cell phone,” unless you
already have one that requires payment. If you aren’t obligated
to pay a cell phone bill, put this is the want category, and you can
decide later whether it is more important than your other wants.
4- Figure how much money the items in
your need category cost each month. Then, subtract that amount
from your monthly figure.
5- Now that you have all your needs
covered, it’s time to prepare for the future. You’re young so I
wouldn’t suggest you start saving for a house, a vacation in Hawaii, or
an airplane yet. Those goals aren’t really practical on
paper-route cash. For adults with steady incomes, a lot of hard
saving might buy them those. But stick with things within your
near future.
If you’re ten, you might
want to start putting a few dollars out of each pay away for a
car. And if you’re sixteen, you might consider putting a little
more away for college/tech school, starting a business once you
graduate, or even to take a post-graduation sabbatical and learn to
play the piano. Whatever you decide to save for, put away enough
to create a growing savings, but not too much to feel deprived of your
wants.
6- Add this up and subtract it from your
monthly figure, minus your needs.
7- Now, it’s time to make a list of all
the things you want. Add the cellphone that you haven’t purchased
here, that Play Station game we were talking about, Oh!, and don’t
forget the McDonald’s sweet tea. (By the way, if you work at
McDonald’s, you get a 50% discount on that. Wink, wink.) Go
through and decide what wants are most important to you. It is
okay if the McDonald’s tea is most important, even if people say that
is frittering, just as long as it is really what you want, and you want
it more than the other items on your list.
Remember, you only have a
set amount of money each month. Don’t obligate yourself to
a cell phone bill if you don’t know when you’re going to Grandma’s to
pack eggs again. Don’t buy twenty sweet teas a month, either,
even if you decide it’s your perk.
8- Finally, add the money it will take
for your wants, fit that within the set money you have left. If
it doesn’t fit, save the want for next month’s list. If your
wants fit fine within your allotment, don’t spend the rest of the money
just to spend it, put it in savings for that car or the tech school
Your Budget = Monthly Earnings – (Needs + Savings + Wants)
And that’s how you budget! If you’re too young to be making money
yet, or you’re old enough and just haven’t found a way, start thinking
creatively about how you could make a little here and there, doing
something you love, without committing yourself to a job while you’re
busy with school.
Like English? Consider tutoring. Interested in cars?
Start a car wash. I know it sounds crazy, but sometimes you have
to work your way up. Interested in nature and design?
Consider mowing lawns for your neighbors. Most lawnscaping
businesses start when a twelve-year old goes out with a lawnmower.
Good luck! And drink a sweet tea for me.
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