The 3 Most Important Parts of Budgeting You Need to Know

Budgeting is something we all know we should do, but it can feel overwhelming at times, right? Honestly, when I first started managing my finances, I was pretty lost. There’s so much advice out there, but when it comes down to it, there are three key parts of budgeting that everyone should understand if they want to get control of their money. Let’s break it down.

1. Income: Knowing What’s Coming In

Well, first things first—let’s talk about income. This seems obvious, but I’ve had so many friends overlook this part when making their budget, and it really causes problems down the line. You need to know exactly how much money is coming into your bank account each month. This includes your salary, any freelance income, side gigs, or passive income streams you might have.

Tracking All Sources of Income

It’s not just about your paycheck either. I remember the first time I included my side hustle income in my budget—it made such a difference! You might have dividends, interest, or even occasional bonuses. Get all of it into one place and track it.

Why It’s Crucial

If you don’t have a clear picture of your income, it’s easy to overspend or make poor financial decisions. Trust me, I’ve been there. I once spent more than I should have on a trip because I didn’t properly account for some irregular income that month. Don’t make the same mistake—get everything in order!

2. Expenses: Keeping Track of What Goes Out

Okay, so you know what’s coming in, but what about what’s going out? This part of the budget is where people tend to struggle the most. It’s easy to forget about small purchases that add up over time, like coffee runs or online subscriptions.

Fixed vs. Variable Expenses

There are two main types of expenses you need to track: fixed and variable. Fixed expenses are things like rent, utilities, or loan payments—expenses that are the same every month. Variable expenses, on the other hand, are things like groceries, entertainment, or dining out, which can fluctuate.

I remember how eye-opening it was when I first categorized my expenses. I was shocked at how much I was spending on food delivery! Once I saw that, I made adjustments, and it was a game-changer.

Creating Categories

Make sure you break your expenses into categories that make sense for your life. That way, when it’s time to cut back, you’ll know exactly where to look. Maybe you want to trim your "Dining Out" category or reduce the "Entertainment" budget for a couple of months. Once I did this, I could clearly see where I could make cuts without feeling like I was depriving myself.

3. Savings and Emergency Fund: Plan for the Unexpected

Now, here’s the part where things get really important. What if something unexpected happens? Like, a car repair or an emergency medical bill? This is where savings come in. Having a savings buffer for both short-term emergencies and long-term goals is crucial.

How Much Should You Save?

There’s no one-size-fits-all answer here, but a common rule of thumb is to save at least 20% of your income. I’ll be honest—this was hard for me at first, especially when I had a lot of debt. But once I started prioritizing savings, I realized that even small amounts add up over time. Start with what you can afford, and increase it when possible.

The Emergency Fund

An emergency fund should be your first priority. Ideally, you want enough to cover 3 to 6 months’ worth of living expenses. It’s there to give you peace of mind. Honestly, the first time I hit $1,000 in my emergency fund, I felt so much less stressed about life in general.

Goal-Oriented Savings

Once you have an emergency fund, you can start saving for specific goals—whether it’s a vacation, a down payment on a house, or retirement. Setting clear goals helps keep you motivated, and once I started putting money aside for a big goal, I felt like I had more control over my future.

Final Thoughts: The Power of Budgeting

Honestly, budgeting is a journey. At first, it may seem like a lot of work, but once you understand these three key parts—income, expenses, and savings—you’ll be able to make smarter decisions with your money. It’s all about tracking, planning, and adjusting as needed.

And if you ever feel overwhelmed, take a step back, breathe, and remind yourself that budgeting isn’t about being perfect. It’s about being conscious of where your money is going and making sure it aligns with your life goals.

Have you ever struggled with budgeting or felt unsure about where to start? Feel free to share your experience or any tips you’ve learned along the way!

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Average Height to Weight for Teenage Boys - 13 to 20 Years

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Staying physically active is even more essential from childhood to grow and improve overall health. But taking it up even in adulthood can help you add a few inches to your height. Strength-building exercises, yoga, jumping rope, and biking all can help to increase your flexibility and grow a few inches taller.

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Most girls stop growing taller by age 14 or 15. However, after their early teenage growth spurt, boys continue gaining height at a gradual pace until around 18. Note that some kids will stop growing earlier and others may keep growing a year or two more.

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Even with a healthy diet, most people's height won't increase after age 18 to 20. The graph below shows the rate of growth from birth to age 20. As you can see, the growth lines fall to zero between ages 18 and 20 ( 7 , 8 ). The reason why your height stops increasing is your bones, specifically your growth plates.