Speaker 1: To live within your means, it is important to create and follow a budget. A budget is an estimate of your income and expenses, usually monthly, for a full year. A budget helps you be aware of your spending, categorize your expenses, identify where your money is going, and begin to build savings and emergency funds. To stay on track to meet your goals and live within your means, you may need to adjust your spending. A budget can help you do that. To create your budget, it is helpful to follow a checklist. Follow these steps. Number one, list all your sources of income monthly, after taxes. This is called your net income. This would include income from your job, side gig, paid internship, a grant, all sources of income. Number two, list all your expenses monthly. Some fixed expenses, such as your student loan payments, will be the same month to month. But some expenses, such as dining out, take out, and household goods, often fluctuate day to day. These expenses can be calculated by tracking your daily expenses for a month. Remember to put aside some money for your emergency fund and your savings account. Number three, label your expenses as fixed or variable. Fixed expenses are bills you can't avoid for things that you need, such as rent, utilities like electricity or your water bill, transportation, such as gasoline, train, or bus fare, insurance, food, medication, and debt repayment. For example, your student loans, many but not all, tend to be the same amount each month. Variable expenses tend to be more flexible and are generally things that you want. You can probably adjust how much you spend on these each month. Variables include dining out, snacks and high-end coffee, travel, recreation, personal care such as manicures, clothes, jewelry, etc. If money is tight, you can always reduce your spending on takeout, eliminate or reduce your expensive coffee or snacks. But you are likely always going to have to pay rent or transportation costs. Number four, create your own budget. Now that you understand the pieces, you can create your own budget. Use a simple budget template similar to this one. Fill in your monthly net income and your fixed and variable expenses. Number five, monitor your spending and make necessary adjustments. The last step in creating a budget is to compare your net income, which is all your sources of income monthly after taxes, to your monthly expenses. If you notice that your expenses are higher than your income, you'll need to make some adjustments to your budget. The easiest way to adjust will be through reducing your variable expenses. It is important to stick with your budget and manage your debt closely. Remember, you are in control of how you spend your money. Here are some tips. It is important to keep track of all expenses so there are no surprises. Be aware of the spending decisions you make every day. Consider using cash when you can versus debit or credit cards. Negotiate your bills where you can. And finally, to live within your means, don't spend more than what you have.