This post is all about a Budgeting for Young Adults
Saving Money Can Feel Like a Nightmare… But It Doesn’t Have To
Saving money can feel like a chore. Where do I store my savings? How much should I save? Am I saving enough? These are all questions you’ve probably asked yourself.
I know I did.
When I first started my journey toward becoming financially competent, I was completely confused. There were so many opinions online, so many strategies, and it felt overwhelming trying to figure out what actually worked.
Thankfully, after many hours of research, plenty of books, and way too many cups of coffee, I was able to take control of my finances. Between 2023 and 2025, I managed to save and invest $72,121. I’m not saying that to brag — I’m saying it so you know this guide comes from real experience.
And the first step that made everything easier was budgeting.
More specifically, budgeting for young adults. Most of us aren’t managing million-dollar portfolios or supporting a family of five. We’re just trying to figure out how to manage rent, food, bills, and maybe save something for the future.
So in this guide, I’m going to break down what a budget actually is, why it matters, and how you can start using one today. I’ll even give you a free Google Sheets template you can use every month to keep your finances organized.
Table of Contents
What Even Is Budgeting?
Put simply “budgeting is Budgeting is a simple plan for your money. It helps you decide how to spend, save, and manage the money you earn each month (or from each paycheck).”
For example, let’s say I know I’m going to make $2,000 in March. If my rent is $1,000, I usually spend around $300 on food, and about $200 on essentials (like coffee, toiletries, and other small things), I would put all of that into my budget.
That way I already know my limits. If my budget says $300 for food, then spending more than that means I’m breaking my plan. The goal isn’t to restrict yourself — it’s just to make sure your money is going where you actually want it to go.
So If It’s That Simple, Why Do I Need a Whole Excel Sheet?
Even though budgeting sounds simple, the reality is that most of us make small, spontaneous purchases throughout the month that we barely even notice.
A coffee here, a quick online order there, grabbing food when you’re out with friends — it all adds up faster than you think. The problem is that without tracking it somewhere, those purchases don’t really register in your mind.
That’s why having a simple spreadsheet or budgeting sheet helps so much. It keeps everything organized and lets you see exactly where your money is going each month, so you can stay within the limits you set for yourself.
My Google Sheets Budget Sheet + How To Use
Step #1: Input All Your Income Streams (Boxed in Red)
The first step after downloading the free sheet is to go to the top right section (boxed in red) and input all the ways you make money.
Basically, any money you receive or expect to receive that month should be included in this section.
This could include things like:
Income from your job (9–5 or part-time)
Gifts or money from family
Stock or investment income
Side hustles or freelance work
Any other money you received that month
The goal here is simple: account for every dollar coming in so you know exactly how much money you have available to budget.
Step #2: Input All Fixed Bills and Expenses (Things That Don’t Change Monthly)
Secondly, you want to add all of your fixed bills and expenses. These are the payments that usually stay the same every month.
This could include things like:
Rent
Phone bill
Internet
Subscriptions (Netflix, Spotify, etc.)
Car payments
Insurance
The reason we enter these first is because they are non-negotiable expenses. These are bills you already know you have to pay every month, so they should be accounted for before anything else.
Also, don’t worry about doing any math yourself. In the spreadsheet I made, the totals and percentages automatically update as you enter your numbers. All you need to do is type in your expenses, and the sheet will calculate everything for you.
Once you add your fixed costs, you’ll instantly see how much of your income is already committed and how much you still have available for things like food, savings, and other spending.
Step #3: Add All Variable Expenses (Expenses That Change Monthly)
Next, you’ll want to add your variable expenses. These are the costs that change from month to month depending on your habits and lifestyle.
Some common examples include:
Food / groceries
Eating out
Gas or transportation
Entertainment
Shopping
Personal care (haircuts, makeup, etc.)
Unlike your fixed bills, these numbers won’t always be exactly the same each month. That’s completely normal. The goal here is just to estimate a realistic amount based on what you usually spend.
Again, the spreadsheet will automatically update the totals for you, so as you enter these expenses you’ll instantly see how much money you still have left in your budget.
This step is where budgeting really starts to help, because it shows you where most of your money is actually going each month.
Step #4: Check Your End-of-Month Report (It Auto-Populates)
Once you’ve entered all your income, fixed bills, and variable expenses, the spreadsheet will automatically generate your end-of-month report.
You don’t have to calculate anything yourself. The sheet will auto-populate the totals and percentages, showing you exactly where your money went for that month.
This report helps you quickly see things like:
How much you saved
How much you spent
Which categories took the most money
Whether you stayed within your budget
It also shows you if you have extra money left over at the end of the month.
If you do, that’s a great position to be in. You can decide what to do with it depending on your goals. For example, you could:
Add more to your savings
Invest the extra money
Or use some of it for fun and things you enjoy
The goal of budgeting isn’t to restrict your life. It’s to make sure your money is going exactly where you want it to go.
Over time, this monthly report helps you adjust your spending and slowly improve your financial habits.
Common Questions:
1. How Much Should Young Adults Save Each Month?
Personally, I like to break my income into percentages. It makes budgeting much easier because you always know where your money is supposed to go.
Using our example from earlier, let’s say I make $2,000 in a month. That represents 100% of my income.
I like to save 20%, which would be $400. Now I know I have 80% left to cover everything else.
For example, I might budget it like this:
50% for rent → $1,000
15% for food → $300
10% for essentials (shampoo, makeup, toiletries, etc.) → $200
After that, I still have 5% left, which is $100. That money can go toward anything I want — going out, hobbies, or saving a little extra.
The nice thing about using percentages is that everything stays balanced. You’ve already saved money, covered your main expenses, and still have some room to enjoy your life.
So id personally save 20-30% of your total Income
2. Where Should I Keep My Savings?
Where you store your savings depends on how soon you plan to use the money.
If you plan to use the money in the next 1–2 years, it’s usually best to keep it in a high-yield savings account. This keeps your money safe, easy to access, and it will still earn a little interest while it sits there.
If you don’t plan to touch the money for 3–5 years or more, it may make more sense to invest it instead of leaving it in a savings account. Over longer periods of time, investments like index funds or ETFs have historically grown much more than regular savings accounts.
A simple way to think about it is:
1–2 years: High-yield savings account
3–5+ years: Consider investing (Index Funds/ETFs) (what is an index fund/etf)?
This helps your money grow while still keeping it available when you need it.
3. What If I Don’t Make Enough Money to Budget?
This is a very common fear, especially in your 20s when you might only be making a few hundred dollars a month.
But ironically, this is actually the most important time to budget. When money is tight, every dollar matters. Even small spending mistakes can make a big difference (trust me… there were definitely months where I lived off cup noodles).
At this stage, the most important goal is building a safety net.
By safety net, I simply mean saving about 3–4 months of your basic living expenses. This money is there just in case something unexpected happens — maybe you don’t get paid on time, you lose hours at work, or an emergency comes up.
I’m not saying you should stop spending money for four months. Instead, try putting 20–30% of your income into this safety fund until it reaches about 3–4 months of expenses.
Once you’ve built that cushion, you can start putting more of your money toward investing and long-term growth instead.
Having that safety net gives you peace of mind and makes managing money a lot less stressful.
4. How Do I Stick to My Budget?
This is something that takes time to get used to.
Most of us don’t track every single dollar we spend, and some months you’ll spend a little more or less than your budget allows. That’s normal. The goal isn’t perfection — it’s awareness.
As long as you’re paying attention and making an effort, you’re already ahead of most people.
Here are a few simple tricks that help:
- Check your bank account once a week
This helps you catch overspending early instead of realizing at the end of the month that you went way over your budget. - Set up automatic transfers
Automatically send money to your savings or investment account each month. This way you’re saving and investing before you even have the chance to spend it. - Track subscriptions and small purchases
Things like streaming services, apps, and random small purchases add up quickly. Keeping an eye on these can save you more money than you expect. - Leave a small “fun money” category
If your budget is too strict, you’ll eventually break it. Giving yourself a little money each month for things you enjoy makes it much easier to stick with your plan long term.
At the end of the day, budgeting isn’t about restricting your life. It’s about making sure your money is going toward the things that actually matter to you.
5. Should I Pay Off Debt or Save First?
In most situations, I recommend focusing on paying off your debt first.
Debt can be extremely stressful, and it’s also a liability. Many types of debt come with interest, which means the longer you keep it, the more money you end up losing over time.
For example, if you have credit card debt with high interest, it can grow much faster than your savings account or investments. So paying it off is often one of the best financial moves you can make.
However, before putting every dollar toward debt, it’s still smart to build a small emergency fund first — even just $500–$1,000. This gives you a cushion in case something unexpected happens so you don’t have to go further into debt.
Once you have that small safety net, you can start aggressively paying off your debt. After it’s gone, you’ll have much more freedom to save, invest, and grow your money long-term.
6. What Budgeting Apps or Tools Should I Use?
Like I mentioned earlier, I personally recommend using Google Sheets or Excel. They’re both free to use, simple, and you really only need to update your budget once a month. Because of that, there’s not much reason to spend money on a budgeting app in my opinion.
I also haven’t had the best experience with most budgeting apps. A lot of them don’t sync well with my bank or investment accounts, and overall I just find spreadsheets easier to control and customize.
However, if you do prefer using apps (maybe you’re busy or just like the interface better), I did test quite a few of them. The best one I found was You Need A Budget (YNAB).
It’s very flexible and does a good job helping you assign every dollar a job. The main downside is that it costs about $109 per year (or $9 per month), although they do offer a free trial if you want to test it first
This Post Was On Budgeting for Young Adults