1. You are a recent graduate starting your first job with a monthly income of R12 000 . You need to create a monthly budget to manage your expenses and savings. Steps:

Here’s a step‐by‐step guide to creating a monthly budget with your R12,000 income: 1. Clarify Your Net Income  • Confirm that R12,000 is your take‐home pay after taxes and deductions.  • If there are any irregularities (e.g., bonuses), note these separately so you can plan accordingly. 2. List Fixed and Variable Expenses  • Fixed expenses: Write down any unavoidable payments like rent, utilities, insurance, subscriptions, or loan repayments.  • Variable expenses: Identify costs that may change month to month, such as groceries, transportation, dining, and entertainment. 3. Categorize Essentials Versus Discretionary Spending  • Essentials: Prioritize necessary items such as housing, food, healthcare, and transportation.  • Discretionary: These include non-essential expenses such as eating out, subscriptions (e.g., streaming services), or hobbies.  • This breakdown helps you understand which areas you can trim if needed. 4. Establish Savings and Debt-Repayment Goals  • Savings: Decide on a percentage (or fixed amount) of your income to set aside. A common approach is the “50/30/20 rule” where 20% goes to savings and debt repayment. For instance, aim to save around R2,400 per month.  • Debt: If you have any student loans or credit card debt, plan to allocate a portion of your budget to repay these debts. 5. Assign Dollar Amounts to Each Category  • Start by listing your fixed essential expenses and then estimate an average for your variable expenses.  • Example allocation (you can adjust these figures based on your actual needs):   – Rent/housing: R3,500   – Utilities and bills: R800   – Groceries: R2,000   – Transportation: R1,000   – Savings & emergency fund: R2,400   – Discretionary (dining out, entertainment, etc.): R1,300  • Ensure that your total allocations do not exceed R12,000. 6. Track Your Spending and Adjust as Needed  • Use tools such as a spreadsheet, budgeting app, or even a simple notebook to record your daily expenses.  • At the end of the month, review your spending:   – Compare planned versus actual amounts.   – Identify areas where you overspent or underspent.   – Adjust your categories for the following month based on lessons learned. 7. Build in Flexibility and Review Periodically  • Life sometimes brings unexpected expenses—set aside a small “miscellaneous” fund each month (or include adjustments in your emergency fund).  • Regularly review your budget. As you settle into your first job, your priorities may change. Revisiting your budget every few months can help ensure it always reflects your current situation. By following these steps, you create a balanced and realistic budget that covers your necessary expenses, allows for some discretionary spending, and helps you save for the future—all while managing your R12,000 monthly income effectively.