This document provides an overview of hydrological budgets. It defines a hydrological budget as a measure of the amount of water entering and leaving a system. The continuity equation, I-O=ΔS (inflow - outflow = change in storage), is introduced. A water budget for a watershed is explained as P-R-G-E-T=ΔS, where P is precipitation, R is surface runoff, G is groundwater flow, E is evaporation, and T is transpiration. Residence time is defined as the average time for a water molecule to pass through a subsystem, calculated by dividing the storage volume by the flow rate through that subsystem. Examples of computing water budgets and residence times