Finances and the Next Generation: Making a Spending Plan

Healthy financial habits are the key to reaching your goals. Thinking about money the right way and developing a good relationship with your finances can reduce stress and set you up for a life you want, pursuing what matters to you. But none of us are born with financial skills. They need to be learned and practiced.

One of the first things we teach in our Money 101 classes is how to create a plan for your money and stick to it—because a solid budget is the first step toward having control over your financial freedom. In our three-part Insight series, we’ll teach you the basics of setting up and sticking to your money plan.

What Is a Spending Plan?

In simple terms, a spending plan (or budget) is a map for how you’ll use your money. It accounts for all of your expenses and allocates every dollar you earn toward a particular purpose.

By tying money to its use, you start to think of money as a tool rather than a goal in itself. And by planning in advance for how every dollar will be spent, you ensure you have enough to reach your goals while living within your means.

Healthy Money Habits for Life

Unfortunately, many people grow up learning money lessons the hard way. They might get in trouble with debt, follow unhealthy role models down a path of greed, or miss opportunities they never knew to look for. That’s why we believe it’s so important to set young people up with good habits right away.

Now that you know more about our philosophy and general approach to budgeting, read on in Part 2 to understand the five uses of money and how to start making your plan.