Budgets are important for teenagers because while we are young we should learn how to properly save and invest in money for when we are adults, we will know how to properly save our money. It helps you learn the difference between your needs and wants. Creating a budget can also decrease stress because you won’t panic when you only have a limited amount of money in your bank account. It is also important to start saving your money while you are young to save up for important things in life. For example, post-secondary, a house, a car, etc. making a budget can help you do so.
Discretionary income is the amount of an individual’s income that is left for spending, investing or saving after taxes and personals necessities( such as food, shelter, and clothing) have been paid. Discretionary income relates to spending because it is the money that is left over after all your monthly income. Discretionary spending is an important part because people will only spend money on things like travel, movies and consumer electronics if they have the funds to do so. Some people will use credit cards to purchase discretionary goods. Discretionary income can relate to savings because it is the money that one has left over could be used towards saving for something in the future.
Tips for a well-rounded budget include, account for every dollar, focus on what really matters(your needs and wants), prioritize your debt, track your budget using a strategy that works for you, give yourself some extra money(just incase) and adjust your budget as time goes on.