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How to Create a Budget

Let's face it, one of the hardest parts of saving money is knowing how to create a budget and being able to stick to it. The idea sounds simple, but the reality is, it isn’t the easiest thing to do. Use this handy guide from Santander as a starting point to creating your own personalized budget plan.

How to Start a Budget

When creating a budget, it is imperative that you first know your expenses. One simple way to do this is by creating what is called a budget list. Simply go through the last three months of your expenses, add them up, and write a list of each of the expenses for each month so you can get a rough idea of how much you tend to spend each month. Using your bank statements for these analyses is a good place to start.

Here is an example of a typical budget list:

Monthly Expenses Amount 
Rent/Mortgage $
Travel expenses (gas, tolls, public transportation, etc.) $
Car Payments $
Groceries and Food (Restaurants, food services, etc.) $
Utilities (phone, internet, gas, water, electricity, etc.) $
Healthcare expenses (medications, etc.) $
Childcare expenses (daycare, summer programs, after school care, etc.) $
Debts (credit card debt, student loan debts, etc.) $
Entertainment (streaming services, etc.) $
Pet Expenses (Vet, toys, treats) $
Clothing and Personal care $


Once you have a rough idea of much you tend to spend each month, you can then decide on how to budget your finances each month to cover those expense and save for the future. Santander’s Mobile Banking App and Online Banking help you manage your money quickly and easily and keep track of your spending. While this exercise is a bit tedious, once completed you will get an idea of how much money you may have left over to allocate to savings or to use to enjoy what life has to offer.

One of the most popular methods of creating a budget is by using what is called the 50/30/20 method. This means you aim to spend 50% of the monthly income on covering bills and basic expenses; these are the expenses that are absolutely necessary. After that, 30% is yours to spend on expenses that may be considered optional, such as dining out or entertainment expenses. The last 20% goes into savings or to pay down current debts.

How to budget money:

While the 50/30/20 method is a great guideline for many people, creating a budget that's perfect for your savings goals may deviate from those guidelines. There are no wrong ways to create a budget as long as it works for you. At the core of any budget are 4 major steps:

  1. Know your net income
  2. Know your expenses
  3. Set realistic goals
  4. Make a manageable plan on how to attain those goals

If you are saving for a new baby, to send your children to college, or for your retirement, take advantage of financial products that will help you achieve those goals, such as automatic transfers to savings accounts or setting up a savings account specific to your goal. Santander Bank has a number of great banking tools that may help you get on top of your finances. Contact a Customer Service Center Advisor today to start a conversation about which Santander products would be best for your goals at 877-768-2265 from 6 a.m. to 10 p.m. ET, seven days a week. Please note that this information is intended for Santander customers in the United States; different rules and regulations apply to our customers outside of the United States.

The information provided herein is for general and educational purposes only. Santander Bank does not provide financial, tax or legal advice and the information contained in this article does not constitute tax, legal or financial advice.

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