Making Sure Your Budget Grows with You

How to adjust your budget as your situation changes

Step 1: Add expenses as they come up

If you start a new hobby or have another new expense that comes up, make sure to factor that into your budget.

• Add that to your expense worksheet so you have it written down and noted on your basic budget.
• Ask your parents to add a new spending target or adjust an existing target if that expense falls into the same category as something else you already spend money on.
• Always go back and check to make sure you spend less than you earn

Step 2: Account for new income

Anytime you get a new source of income, you also need to add that into your budget, too. Try to put as much of that money as possible to boost your savings. If you make more, you should save more too.

However, you can also use the new income to add expenses. Treat yourself when you make more money. Maybe let yourself spend a little more money on something you already love and spend money on. Or add something new that you may have avoided because you’re trying to stick to your budget.

Smart Money Tip: Don’t forget to donate!

Giving back is good! You should give money to causes you believe in and movements you support. If you start getting more income, think about boosting how much you donate each month. Find new causes you can support and put your new income towards doing good in the world!

Step 3: Start planning for the future

One smart way to use your budget is to set savings for specific expenses that will come up soon.

• Plan on buying a car? Set a car expense in your budget so you can start saving for a down payment.
• Planning on going to college? Ask your parents if you can set aside money each month to contribute to your college savings fund.

Building savings for specific goals into your budget can help you reach those goals faster and avoid debt. The more you save up for a car, the lower the monthly payments will be if you get a car loan. Saving for college now means less income spent later to cover student loan payments.