Every household wants to meet their financial needs while being able to save for the future, whether that means meeting retirement goals, or being prepared for an emergency expense. A good place to start is by creating a sustainable budget. A sustainable budget simply means that you have the income to meet or exceed your expenses. And, with careful planning and commitment, you may even be able to enjoy a few luxuries without overextending yourself.

Here are some steps to help you get off on the right financial foot in 2025:

1. List Your Income. This includes your normal paycheck as well as any other anticipated income.
2. List Your Expenses. This starts by understanding where your money goes, so review bank statements (or your accounting software) to identify spending patterns over the past three months. Categorize expenses into fixed expenses such as your rent or mortgage payment that you have to pay each month, and variable expenses that you can cut out or minimize if needed, like eating out.
3. Subtract Expenses from Income. If you’re fortunate to have money left over, move it into a savings account or pay off existing debt, such as your credit card. If you have money left over each month allocate a percentage to savings; many banking and finance apps can move it for you automatically. If the calculation brings you to a negative balance, cut down on your variable expenses.
4. Track Your Expenses. Do this for the entire month; there are several mobile apps that can track them for you to make this task easier – and even find “hidden” expenses like streaming television subscriptions you no longer use.
5. Make a New Budget for the Next Month. It may not change much, or at all, but you need to account for varying family expenses, like soccer uniforms, taxes, or planned car maintenance. Setting a budget each month helps you stay on track even as things change.

There are a few other important considerations to keep in mind when setting and sticking to a budget. First, make sure you and your budgeting partner agree on your priorities and goals. Do you want to pay off debt, or save for a family vacation? Staying committed to the goal keeps you committed to the budget.

Second, be realistic. Overextending yourself leads to debt – and stress – but if you are too restrictive you may find it hard to stick to. You work hard for your money and as long as you are meeting your expenses, allow yourself a few luxuries – especially if you reach a milestone such as paying off your automobile.

Finally, remember that employees can visit Fidelity for additional tips on how to manage your money. Simply log in to your Fidelity account to access the information.

Budgeting doesn’t have to be unpleasant. Once you’ve gone through a few months you’ll feel like a master at it. Better yet, you can feel good about taking the basic but necessary steps to support your financial well-being long-term.