How to Budget Your Money
Are you thinking about getting your finances under control and tightening up your belt to achieve some goals? Then first thing’s first, you need a budget! Goals are great, but you need to know where you are starting to know where you’re going to end up and how to get there.
There are two ways to on How to Budget Your Money. First, would be listing out all of the possible spending categories (payables) and plugging in your “take home” income (receivables). The other is the reverse. List out all of your monthly expenditures and then divide your monthly income up accordingly. Personally, I think there is no “right” or “wrong” way but only a matter of preference and what actually works for you.
How to Budget Your Money
If you are tackling a budget the first way I listed (by a set list of payables), there are many categories to consider. A preset format may be the easiest place to start, but it can be easy to overlook categories that may apply to you that are not included.
Here are some categories to get you started, you can do subcategories under each to get specific.
For your house/apartment:
Mortgage/rent
Utilities
Household furnishings and equipment
Household operations
Housekeeping supplies
Transportation:
Car payment/loan
Insurance
Gas
Public transportation
Ridesharing/share of cost
Maintenance/upkeep
Food:
Cost of groceries
Take out/dining out/unplanned grocery trips
Food prep costs
Unexpected/inconsistent bills:
Healthcare
Life insurance
Investment plans
Savings accounts
Clothing
Entertainment
Credit cards/debt reduction
If you are starting in “reverse” and listing you expenditures first, I would suggest collecting the bills in hand on paper (even if you pay online). A tangible bill in hand makes it easier to get the bigger picture that you need for a budget. Don’t forget to include the non-bills like food, gas, and recreational activities. Those items may take looking at your past bank statements to come up with a paper you can keep “in hand”. Next, prioritize them by order of importance. Some people prefer to use different “hands on” systems. Something along the lines of a budget binder or using the envelope system may work for best you.
What may work best for one person, will not work for another. Try different systems and find out what will help you get your budget under control and stick to it! Holding yourself accountable will help in more areas of your life than just your finances. It seems like a daunting task, but once you get the system in place you may find that it isn’t as overwhelming as you thought it was.
Read part 1 of Angie’s Living on $30,000 Best Frugal Tips on Thriving and (not just surviving) on $30,000 a year!
Part 2 – Basic Home Budgeting
Part 3 – How to Budget Monthly Finances Wisely
Part 4 – How to Not Spend Money
Part 5 – Smart Money Saving Tips to Control Your Debt
Part 6 – Money Management Skill
Part 7 – Why Couples Should Talk About Money?
How to Use Your Tax Refund to Build Wealth
How to Manage Food Budget for Family?
Angie Rumpf
I am a stay at home mom and happily married to my husband Tom. I have a five year old daughter and a two and a half year old son. I grew up in Orlando, but went to school in New York City and lived in Los Angeles before moving home to raise a family. I have worked in the film industry since the early nineties, and for over a decade with the Florida Film Festival. I also spent many years working in marketing with Glaceau and Honest Tea. But, I am happiest at home building my family.
For more Best Frugal Tips, read these:
How to get rich in 5 minutes a day
Frugal Ways to Save Money: Getting Out of Debts
How to Save Up Money: Tips for Living on $30000 or Less
How to start an emergency fund
Cook, Baker, Phototaker, Fitness Mover and Shaker, Cupcake Tester, Deal Maker, Adventurous Undertaker, Do Good “Deeder”, Teacher, Mom, Wife, Patriot for Life & Giver of Good Advice – RealAdviceGal