15 Create your own custom budget. Enter your estimated income. Consider your sources of “income” (i.e., money from parents, wages, gifts) and enter the amount you expect to have available to spend during your selected time period (week, month, six months, etc.). Categorize your expenses. Think about what you spend your money on and come up with a list of expense categories that makes sense to you (e.g., Eating Out, Entertainment, School Supplies, Cell Phone, Clothes, Car Loan). Determine if each category is a fixed or flexible expense. Fixed expenses are the same every time period. $125 each month for car insurance is a fixed expense. No surprises here—you know exactly how much you’ll spend each month. Flexible expenses are those that vary. $30 for clothes one month; $75 the next. Budget an amount for each expense category. Take each category and budget a dollar amount for that time period (e.g., $75 for entertainment, $100 for car insurance, $50 for eating out). Put your fixed expenses into your budget first—this will help determine how much you have available for your flexible expenses. Keep track of your income and your expenses. Enter all of your income and expenses into your spreadsheet or app. When you sit down to review and balance your budget, you’ll then know exactly how much money has come in, and how much you’ve spent in each category. Review and balance your budget. At the end of your budget period, compare your income with your expenses. If your income exceeds your expenses, you’ve achieved a “positive balance.” Good for you! Your “savings” can be set aside for the future. A “negative balance” reveals that your expenses have exceeded your in- come. You are spending more money than you’re taking in. How is this possible? You’re either eating away at your savings or you’re running up debt. Now is the time to determine how to reduce your expenses and/or increase your income.