 TITLE: How to Manage Your Money CONTENT: Create a Budget\n---------------\nA budget is a spending plan for your money that ensures you'll have enough for the things you need and that are most important to you. To create a budget, follow these steps.\n### Take Inventory of Your Finances\nBy taking an inventory of your finances, you can get a clear picture of what you own, what you owe and how you're spending your money. To begin, write down your assets, which may include your house, investments, cars and savings account balances.\nThen, jot down your debts, which might include student loans, car loans, personal loans, credit card balances and more. Next, keep track of every purchase you make for the next few months.\nYour financial inventory may reveal that your grocery or restaurant spending is out of control or that you are spending more than you make or have more debt than you thought you had. It will give you an idea of how you're doing financially and where you need to improve.\n### 2\\. Choose a Budget Plan\nThe budget plan you choose will depend on your strengths and weaknesses when it comes to money and your unique financial goals. Here are a few options to consider:\n*   **The envelope system**: If you wish to stop careless spending or stay out of debt, the envelope system may be a good choice. Set a monthly spending limit for each expense category, such as gas, groceries and entertainment, and fill an envelope with only the amount of cash you want to spend for that category. Once the envelope is empty, don't allow yourself to spend more money on that particular category for the rest of the month.\n*   **Pay yourself first**: The pay yourself first budget may be right for you if you have difficulty saving money. You decide how much you'd like to set aside for your emergency fund, retirement fund and other savings accounts, and then use the rest on your monthly expenses and discretionary spending.\n*   **Zero-based budget**: You may benefit from the zero-based budget if you'd like a strict plan for your money. With the zero-based budget, you take your income and allocate every dollar in some way until there are zero dollars left. By budgeting your essential and discretionary money down to the penny—including everything from rent and utilities to savings to eating out—you can make sure your money goes exactly where you want it to every month.\n### 3\\. Review Your Budget Monthly\nAt the end of every month, sit down and review your budget to make sure you're staying on track. Compare your actual expenses to what you created in your budget to figure out where you did well and where you need to improve.\nDuring your monthly budget review, you may find you need to tweak your budget as a result of a change in your income, expenses, goals or all of the above. This is fine, as your budget is bound to change as you go through different stages of your life. END