Track Your Spending
Before creating a budget, spend a month tracking every dollar you spend. This awareness alone can transform your relationship with money. Many people are surprised to discover where their money actually goes versus where they think it goes.
Get Started:
- Use a simple notes app to log expenses for a month
- Try a budgeting app that connects to your accounts
- Review bank and credit card statements to categorize spending
Create a Simple Budget
After tracking your spending, create a budget that aligns with your values and goals. Start simple with broad categories rather than trying to account for every potential expense.
Try the 50/30/20 Rule:
- 50% for needs (housing, food, utilities, transportation)
- 30% for wants (entertainment, dining out, subscriptions)
- 20% for savings and debt repayment
Start an Emergency Fund
An emergency fund is your financial safety net. It prevents you from going into debt when unexpected expenses arise and provides peace of mind.
Build Your Fund:
- Begin with a goal of $1,000 in a separate savings account
- Once achieved, work toward saving 3-6 months of essential expenses
- Set up automatic transfers to make saving consistent
Understand Your Banking Options
Take time to research and understand what your bank offers. Many financial institutions provide tools and resources specifically designed for beginners.
Banking Features to Explore:
- Free checking and savings accounts with no minimum balance
- Mobile banking apps with budgeting and savings tools
- Educational resources to improve financial literacy
- Automation features for bill payments and savings
Fifth Third Bank, for example, offers financial wellness programs that include personalized insights and recommendations based on your spending patterns.
