Question

Section 1: Creating a Two-Month Budget

Imagine that you are a college student who lives away from home. You have a work-study job at your
college library, and you earn about $600 each month. You have one major long-term goal: you want to
save up money to visit your family soon, and you need at least $100 for your train tickets.
1. Create a budget that will allow you to save at least $100 by the end of October. (10 points)
Make sure your budget includes these fixed expenses:
The cost of rent ($250 each month for your shared apartment)
The cost of your bus pass ($40 each month)
The cost of books ($150, but only in September, at the beginning of the school year)
Make sure your budget considers these variable expense categories:
The cost of food
The cost of clothing
Discretionary spending (money to spend freely)
Personal Budaet

Answer 1

To create a budget that will allow you to save at least $100 by the end of October, you need to make sure that your income is greater than your expenses. Here is a possible budget that you could use:

This budget allows you to save $610 in September and $610 in October, which means you will have saved at least $100 by the end of October. To make sure that you have enough money to buy your train tickets, you can try to save more money in the discretionary spending category, or you can cut back on some of your other expenses.