How To Be An Adult Part 2: Simple Budgeting Guidelines

Simple budgeting guidelines

How to be an adult part 2: Simple Budgeting Guidelines

Now that you understand how your pay cheques work let’s talk about budgeting that money.

What is a budget?

So what exactly is a budget? Well according to the smart people over at Merriam Webster(the dictionary people) Budget as a noun is defined as:

a :  a statement of the financial position of an administration for a definite period of time based on estimates of expenditures during the period and proposals for financing them
b
 :  a plan for the coordination of resources and expenditures
c
 :  the amount of money that is available for, required for, or assigned to a particular purpose

And as a Verb:
1a :  to put or allow for in a budget
b :  to require to adhere to a budget

2a :  to allocate funds for in a budget <budget a new hospital>
b :  to plan or provide for the use of in detail <budgeting manpower>

So basically, for our purposes of personal finance a budget is the plan you give yourself on how you’re going to allocate your money. It doesn’t have to be spending, if you’re budgeting your pay cheque it should certainly have savings in it. Also you may want to include something towards an emergency fund.

How does one go about making a budget?

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How To Be A Successful Adult: Understanding Your Paycheck

How to be a successful adult: Understanding your paycheck




How To Be A Successful Adult: Understanding Your Paycheck

This seems like a topic that shouldn’t be needed. Your paycheck is quite simply your pay for performing your job at your place of employment. You have a total at the bottom that tells you how much money you’re getting. What’s so hard about that? Well I consistently see people who have received paychecks for decades tell people incorrectly how taxes work and many other mistakes. On top of that there’s sometimes dozens of additional lines that add and subtract money. There could be anything like health benefits, dental, life insurance, pension, GRRSP, union dues, tool allowance, and a hell of a lot more.  Read more