What is a Spending Plan?

AliciaA spending plan is a simple strategy for making the most of your money and reaching your financial goals.

CassieHow do you create a spending plan? On a simple, one-page form you write down the money you have coming in and what you spend in an average month. Putting it down on paper helps you see where you can improve and make better money decisions.

AliciaSome people call this making a “budget.” But we happen to like the term “spending plan” a lot better. Because it’s a good reminder that how you spend, and how much you spend, is really up to you.

CassieA spending plan can help you live within your means. That means living a lifestyle that you can afford: not spending money faster than you earn it and not borrowing more money than you can afford to repay.

AliciaThe right spending plan can help you set aside enough to pay your bills, have some savings for emergencies, and some money left over in your pocket every month.

CassieIn this lesson, we’ll introduce you to the key concepts of a spending plan. After that, you’ll have the opportunity to create a spending plan of your own. Let’s get started!

Key points about Spending Plans

A Spending Plan:

  • Becomes your personal strategy
  • Is a simple one-page form
  • Helps you live within your means
  • Helps you avoid too much debt
  • Helps you pay your bills
  • Highlights your savings and money to spend

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