Saturday, June 4, 2011
There is a great tool on her website- the Interactive Budget Worksheet. I would recommend filling it out honestly to start out with- what you make and what you currently spend PER MONTH in each category. If you need to change labels, there is an Excel version to download also.
DO THIS NOW before reading on! Don't worry about the columns on the right- just go down the ones on the left (A and B).
When you finish that part- check out the % you are spending in the Housing, Transportation, Life, Debt and Savings section. Are you spending a lot more in one category than the others? You can see how much you are under or over your monthly income.
THEN make adjustments so you are on budget (last line of the spreadsheet "Income-Expenses" should have $0) and not too lopsided in those % rows. Be realistic- where can you cut? Did you forget any categories? I had to add a few and change them around.
Having a budget helps you think about all expenses so there are less surprises later and all your money has an assigned place to cover.
I needed to reallocate my budget and get things more streamlined for the summer and going back to a cash budget. It even tells me how much to take out weekly and put in each "Jar" or envelope- whatever you use. These are the variable spending areas, so if you have leftover you can use it toward something else- adding to your debt payments or rewarding yourself for staying on task. This is where I get the money for a big trip we are saving for!
Let me know what you think! How have you done your budgeting in the past and does it work for you?
Photo from Gail's Blog.