How do I create a realistic monthly budget?

Start by tracking all your income sources to get your true monthly take-home pay. Then list every expense, separating fixed costs like rent, car payments, and insurance from variable ones like groceries, dining out, and entertainment. Pull three months of bank and credit card statements to find your real spending averages, not what you think you spend. Use the 50/30/20 rule as a starting framework: 50% for needs, 30% for wants, and 20% for savings and debt repayment. Adjust those percentages to fit your situation. The key is being honest rather than optimistic about your habits. Review the budget weekly at first, then monthly once you find your rhythm, and adjust categories when reality consistently differs from your plan.