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You must make time to set yourself a budget

Financial planning: making a budget ahead of time helps to prioritise expenditure and evaluate what is important

Dear Dave,

I work long hours, and I make pretty good money. The problem is the money from my paycheques always seems to disappear before the end of the month. I know part of the problem is grabbing quick meals between extra shifts, and eating out a lot after work, because I’m usually too tired to cook when I get home. How can someone who has very little free time start gaining control of their finances?


Dear Sheila,

No matter how little free time you think you have, or how tired you are, you must make time to do a written budget every month. This is essential. Making a budget for the month ahead isn’t a lot of hard work, and it really doesn’t take long. When you give every dollar a name before the month begins, you’re taking control of your money instead of allowing a lack of it to control you.

Start with the income you know is predictable. If that isn’t possible, look back over the last few months and find the minimum amount you brought home during a month over that period of time. This will be the basis for your budget. Once you’ve established a baseline income, you can write down and prioritise bills and other expenses. Just remember, restaurants are not a priority.

When you make a prioritised spending plan, and start telling your money what to do ahead of time, you’ll have the ability to do what’s important with what you’ve earned.


Dear Dave,

My wife and I want to begin teaching our son how to make a budget and live on one. He’s 16, and he has a part-time job and a hand-me-down car. Is this a realistic idea?


Dear Mike,

Your son is at a great point in life to learn how to make money behave. Even in his situation, when he’s still living at home, there are plenty of things he can include in a budget. There’s gas for his car, along with maintenance and insurance. He’ll need to save a little money — maybe even for college — and I’m sure he’ll want some spending cash, too.

Sit down and teach him how to make a written budget by figuring out the upcoming month’s income and expenses ahead of time. Also, make sure he knows how to properly balance and reconcile his bank account.

It’s still your responsibility to provide him with the basic necessities at this point. But I love your willingness to teach your son how to handle money intelligently. The sooner he learns some basic money management principles, the sooner he’ll be able to handle his finances responsibly in the real world.


Dave Ramsey is CEO of Ramsey Solutions. He has authored seven bestselling books, including The Total Money Makeover. The Dave Ramsey Show is heard by more than 14 million listeners each week on 585 radio stations and multiple digital platforms. Follow Dave on the web at daveramsey.com and on Twitter at @DaveRamsey.