Keep a notebook and write down the little things you may not have receipts for, such as vending machine purchases. Add it all up. Subtract these expenses from your income. You have created an expense sheet that tracks where all your money goes. Before you decide to break out the tissues because you realize you've been gobbling up your cash in munchies and magazines, let's zoom in for a closer look at this budget.
Income can come from many sources but still amounts to money in.
Although income is usually fixed, expenses are more flexible. We're most concerned with variable expenses because when those are adjusted, it has a big effect on our bottom line. It's time to break both expenses and income into categories to help you keep track. We'll explain what the categories should generally consist of. But even with online number crunching, you need to know what the entries mean.