Managing Your Money

Earning money is an important part of becoming independent, but managing that money is even more important. Having a plan for how you save, spend, and use your money will make a big difference in how you’re able to live your life and take care of your family.

Making a Budget

A budget might sound complicated or hard to do, but really, it’s just making a plan for your money.


First, you’ll need to figure out how much money you have each month. Remember—some money is taken from your paycheck for taxes and social security. Then, add in any other money you receive, like child support, or benefits like WIC or EBT. For the purposes of your budget, this is your income.


Where does your money go? Your expenses are anything you spend money on. These can include big important things like rent, food, diapers, a car payment, a phone payment, a monthly bus pass, gas, clothes, and childcare and smaller things like nail polish, a pack of gum, or a magazine.

A very good way to know exactly how much you spend each month is to track your expenses for a few weeks-or even the whole month, by writing down everything you spend, keeping all your receipts and adding them up at the end of the month, or using an app on your phone to keep track. This will tell you where your money goes—you may be surprised.

Making a Plan

In a perfect world, your income would be equal to, or bigger than your expenses. If that’s not how it is right now, you have a couple of choices—earn more money, or cut down your expenses.

Ways to earn more money include: working more hours, finding a job that pays more than the job you have now, or working a second job. You may find cutting your expenses to be an easier first step.

Some expenses, like rent or a bus card, can’t really be cut. They cost what they cost, without any wiggle room. But you might be able to cut down other expenses, like clothes, gasoline, food, and smaller things. Can you get a ride to work or share gas costs with someone? Can you use coupons or choose the store brand to save money on groceries?

When you’re trying to make the most of your money, it can be helpful to figure out if you really need something, or just really want it. Needs are things that are required to keep you and your baby healthy and safe, like food, shelter, and a way to get to work and school. Wants are things that would be nice to have, but won’t make you unhealthy or unsafe if you don’t have them. When you’re making your budget, you must cover all your needs before you spend on wants.

Managing Money

A budget only works if you stick to it. Here are a few ways you can keep yourself on target with your plan:

  • Use cash. For some people, money doesn’t seem real unless they can actually touch it. For them, using a debit card might not be the best choice. If you think you might be one of these people, taking out only enough cash to cover your expenses may be a better option. To manage cash, try:
    • Envelopes. You can divide the cash into envelopes for each expense. When the envelope is empty, you can’t spend more on that category.
    • Only carrying enough cash with you for expenses you’ve budgeted for. You should also carry a small amount of cash for an emergency like losing your bus pass across town, or forgetting to bring a fresh diaper for your baby.
  • Take notes. Keep track of what you’ve budgeted, and stop spending when you’ve reached it. You can do this by writing down each expense, or using an app. Some apps even connect to your debit card, track your spending for you, and alert you when you’re overspending.
  • Avoid temptation. If something really tempts you to spend money in a way you haven’t planned, don’t go to where they sell it. “Just looking” probably won’t make you want it less, and you may be tempted to overspend.
  • Take time to think. Often when we go over our budgets, we’re not planning to. We’re struck by an impulse—a sudden idea. If you make yourself a rule that you have to wait three days to buy something you haven’t planned on, you may find that the impulse passes, and you don’t really want it that much.

You Can Do It!

Managing your money is a skill. Just like any other skill, you can learn it and it takes time. You may make some mistakes and it won’t always be easy, but you can become very good at managing your money!