Budgeting

You’ve just received your paycheck. Woot! You’re chanting to yourself: “Show me the money!” When suddenly… You see the smaller of two numbers and realize: THAT is what you’re actually taking home. So which is it: your gross pay or net pay? Understanding the difference between the two will either set you up for budgeting success…or failure. 

If money is tight, what’s the first category in your budget you seriously cut back on? Not rent. We gotta live somewhere. Not food. A girl’s gotta eat! Most likely, you cut expenses in that broad category labeled “entertainment”—essentially, your “fun” money. 

It’s impossible to put into words what we’re all going through right now. The coronavirus is impacting each and every one of us—our loved ones, our relationships, our mental health, our jobs, and lastly our finances. I know it seems like just a small drop in an ocean of uncertainty, but one thing we can all look forward to is some relief from the federal government in the form of stimulus checks. 

Rainy day fund, emergency fund—they’re all the same, right? In a word…no. Although we often use these terms interchangeably, rainy day funds and emergency funds are two completely different things. Don’t worry. I didn’t know the difference before either! On our paths to financial freedom, it’s important to understand what both of these funds are, what they’re used for, and how to start saving for them. 

Budgeting doesn’t have to fill you with dread. I’m sure it’s a close second to dieting on the list of most hated things EVER… However, budgeting and learning how to manage your money are essential skills that we all must master. After all, creating a budget is key to achieving financial freedom.