How to use a budget to build financial resilience
(NC) The world we live can be complex and challenging. One way to stay on top of things is to develop your money management skills to keep up with your bills and financial commitments.
Needs vs. wants
Knowing the difference between your needs and your wants is key to making a smart budget. A “need” is something that is essential, such as food or a roof over your head. A “want” is something that you’d like, but don't necessarily need. This can include, for example, a meal at a restaurant, a vacation or designer shoes.
Remember that needs and wants can differ from one person to another. Once you’ve sorted out what your needs and wants are, you’re ready to start your budget.
To create a good budget, you need an effective tool. The Financial Consumer Agency of Canada has an online budget planner that’s easy to use.
The first step is to outline your income and monthly expenses. As you’re entering your numbers, the budget planner gives you tips about how to save more and/or spend less and helps you figure out if you will have money left or if you’re overspending.
This information, in turn, will show you how to better manage your day-to-day finances and spend your money wisely. This is a powerful way to build financial resilience and lower your stress levels.
Find the budget planner and more money tips at canada.ca/money.
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