More For Your Money - University of Illinois Extension

Income and Expenses

It's been said that "spending money without a plan is like driving without headlights!"

Cars driving at night.

A spending plan can help you take control of your money. When you use a spending plan, you know where your money goes. You can use the plan to work towards your goals.

The first step in creating a spending plan is to look at your goals. Do some of your goals require money? For example, do you want to save money each month for emergencies? Do you need to set aside money each month to buy something (like a car) or for a special event (like holiday shopping or retirement)?

Take time now to decide how you want to use your money each month to help with your goals. Check – Values and Goals for more information on how to write goals.


The next step in creating a spending plan is to estimate your income, so you will know how much money you will have to spend during the period of your plan. The planning period may be a month, a year, or any length of time you choose. Since many of your bills are paid monthly, start with a monthly plan.

Many people have income from more than one source. Here is a list of possible income sources.

  • wages, salaries
  • self-employment income
  • pension/retirement
  • unemployment benefits
  • public assistance
  • Social Security
  • veteran benefits
  • investments
  • insurance benefits
  • disability benefits
  • child support/alimony
  • help from family/friends
  • other