In short: A personal budget is a plan of how much money comes in and where it will go over a period — for example a month — regularly compared with what actually happened.
Simply put: A budget is not a ban but a choice: you decide in advance where the money goes, instead of wondering afterwards where it went. It has three columns — plan, actual and difference. Start with 4–6 categories (food, transport, leisure, savings, unexpected), not 40: more categories bring fatigue and giving up. Saving is a line in the budget, not whatever is left over.
Example: You planned €400 for food and actually spent €460. The €60 difference is not a punishment but information: next month you either raise the plan or find where the money leaks.
Watch out: If one category goes over the plan every month, the plan may be wrong, not you. And the myth "budgets are for people who have no money": a budget is for people who want to decide for themselves.
Source: European Commission and OECD/INFE, financial competence framework for adults (2022) — https://finance.ec.europa.eu/publications/commission-and-oecd-infe-publish-joint-framework-adults-improve-individuals-financial-skills_en