So, you’ve never had a budget before, and if you did, it just quietly disappeared without much of a thought. You’re making more than or the same amount as you spend, so why bother with one? There are many good reasons to make a budget, and it’s an easier habit than you think to get into.

1. Why you really need a budget

If you don’t have a budget, you can’t properly plan for the future… or even for now. Budgeting isn’t a matter of cutting down on the fun stuff, either – it often allows you to spend the money you’ve allocated guilt-free and stress-free, without worrying about about making the rent payment or anything else, because you know you can afford this cool new gadget. Everyone with an income should have a budget, if only to confirm to yourself that you’re saving as much as you could be and spending the right amount of money.

2. List monthly income

For those with a steady, “regular” job, this is the easiest part. Just record how much money you make each month. If it varies slightly, take the lower numbers and anything extra is a bonus to be put straight into your savings. Of course, not everyone has it this easy. If your job is irregular and you can’t easily estimate how much you’ll make, you might have to use a different budgeting method – look up the envelope system, for example. If you use this system, try to budget using last month’s income so you will already know how much you have to spend this month.

3. List expenses

Next, you’ll want to figure out what you owe, and to whom. Any regular expenses are the easiest to calculate – just write down the numbers and what they’re for, starting with the most important regular expenses like rent and working your way down to things like laundry fees. Any variable expenses come next, such as entertainment.

4. Adjust future estimates accordingly

When you have a good idea of how much you spend per month, you might want to adjust the estimates for future months, if you feel that you can cut down on spending easily. If any amounts shocked you, this may be fairly easy – you can just resolve to spend less on certain categories of items, then follow through with the resolution by keeping track using a notebook or receipts.

5. Save for the future

Start putting 10% of your income away if at all possible. Even if you don’t make much, these savings can accrue rapidly. High-interest savings accounts are the easiest way to gain money for your investment, but there are other types of investments like CDs, bonds, and mutual funds to look at, too. Check with a financial advisor for the best idea of what you should be investing your money into.

Budgeting can be infinitely more complicated if you want it to be, but really, that’s all there is to it. Just have a good idea of what’s coming in, what’s going out, and what’s going “aside” to save for the future, and you’ve created a budget!