Making a budget to save money

A budget can estimate how much money you have and how much money you need to spend on things like rent and food. Learn how to budget your money. This can help you cover your expenses and even save money monthly.

How to make a budget to save money

Create your budget around your paycheck. Are you paid weekly, every two weeks, or monthly? Make your budget around your pay periods.

  • Write down your monthly or weekly income
  • Make a list of monthly or weekly expenses: food, utilities, rent, bus fare, or car loan for example
  • Make a list of other expenses you have to pay: insurance, repair bills, school expenses
  • List how much you need to put aside: for example, you will want to save money for emergencies and save up for purchases or for travel
  • Add an amount for entertainment or other things you want to spend on. Just remember it is wise to buy the things you need before the things you want!

If your income does not cover all your costs, your budget is not balanced. If you cannot increase your income, you will need to cut down on expenses where you can.

Save money and keep records

If you have some money left over after your expenses are covered, start saving! The best way to save money is by putting it into your savings account. You can use your savings if you have an emergency. Experts recommend you create an emergency fund equal to six months’ expenses in the event you lose your job or get injured. After you have built up an emergency fund, then you can save money to do something fun, like go on a vacation with your family or buy something special.

Make sure to pay all of your bills on time so that you do not have to pay any late fees. Keep all of your important receipts and records of how you spend your money in one box, drawer, or file.

Check your bank account statement. It provides you with detailed records of your expenses. Read our guide to banking in the USA.


Credit means borrowing money from the bank or credit union and paying it back later. When you borrow money using credit, you will have to pay interest or a fee for borrowing the money.

It is important to pay all of your bills on time so that you protect your credit. If you want to buy a house one day, you may need to use credit. You can learn more about credit cards and loans.

If you decide to get a credit card, you need to be very careful to pay your bills entirely each month. Credit cards can be helpful but often charge you very high interest if you do not pay them off every month. Do not spend more money than you have!


Be careful when you are giving money to people you do not know, especially if you are paying with cash. It is better to get a checking account at a bank or credit union so that you can pay by check and then you have proof of paying your bills. If you have to pay cash, always ask for a receipt so that you have proof of payment.

There are some scams (tricks to cheat people) that target people who are new to this country and do not speak English well yet. If you get mail or email that says you need to pay a lot of money or that you won a lot of money, it is probably a scam or fake. Check with the post office, your volunteer/mentor, or a trusted friend or neighbor if you are unsure.

If you are considering buying, investing in, or paying for something, it is acceptable to ask for an agreement in writing or to say you need to talk to your spouse or think about the offer. Do not feel pressured to pay a large amount of money without documentation or time to ask for advice.


In the USA, everyone is required to report by April 15 every year how much income they received in the year before. That report is called a tax return. You may owe taxes on that income. Taxes are money that you pay the government for the public services you receive, like school for your children and roads to drive on. You can learn more about taxes and how to pay taxes. Depending on how much money you make, however, you might receive a refund (money back from the government) on the tax you already paid during the year.

When you receive a paycheck, some money will be taken out of it to cover certain taxes. Your employer will keep some money from your paycheck to give to the government on your behalf. This called withholding taxes. This includes state and federal taxes, unemployment insurance, and social security, which is savings for retirement or disability.

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