This article is about budgeting tips for people that really hate to make a budget. Trust me, unless you are an accountant or financial planner, I am pretty sure that likely means you!
If there is one thing I learned in financial planning is that you must have a written plan. That always starts with a written budget of your household income and family expenses. In my family we still do this each year, and I am always amazed what even a minimalist like me spends money on.
It is not even difficult and can actually be fun. Here are my tips to get you going. I have also included a budget template for you that you can modify or use as is: Download Budget Template. Please start by printing this template out. You can of course make your own paper and pen template using this as an example. For those that are technology savy, I have also created my recommended mobile budget applications. Last, here is a quick and easy personal finance budget quiz, to give you some broader ideas.
Here are some simple steps to keep your budget interesting, and on track.
Know your “Why”
The first important step is to know your “Why.” Your “Why” is all about the reasons you are completing this exercise. It might be different for you, but I believe the important reason is to simply be aware of what you are spending each month, and what you are spending on. Do you spend too much? Could you spend less? If you had excess money at the end of the month, what goal what would you place the funding towards? Excess money can be saved for emergency funds, vacation or other fun goals, and definitely for long term retirement or safety reasons. Know your “Why” and you will want to do the work.
Keep it simple but do it
Yes, that’s right. This is simple to do, but not so simple that you can do this in your head. You must print out the template and do the work. Please print out the template and do not try to complete online or in excel, except to modify the template for your use. It is very important that you print out the budget.
Commit to a reasonable time frame
You need to commit to write down your actual expenses for more than a day, and try to do so for about three months at least. Do not cheat yourself. This is your spending habits and your life. What could be more important?
Write down everything you spend
This is a team effort. You and your family will write down each and every income item you have, and each and every expense item you have. You simply write the amount in the columns under the correct month heading. Be sure to write down EVERY SINGLE EXPENSE that you make. Not guesses but actual amounts. Don’t try to cut back or do anything different. Just observe yourself and your family’s expenditures.
At the end of the month, tally it up!
At the end of each month, check your visa or other documents, and be sure that you have included everything in the correct month. You may wish to record utilities on an accrual basis (for the month it is for) or on a cash basis (when you pay the bill). It does not matter because this exercise will be over a few months and will give you an idea of what you spend monthly.
Now, the budgeting questions
After you have done the exercise seriously, you can look at what you can change. You know your “Why” and you know what you normally spend each month. Are there excess spending habits that you can identify? What amount can you contribute to your long-term retirement or freedom plan? Take a look. You will find it.
Start now.
Yes, you can do this, and start now.
Download Family Budget Template (Easy)
by Joanne David CFP FCSI
~ Download Family Budget Template (PDF)
~ Download Family Budget Template (XLS)
~ Download Family Budget Template (GoogleSheets XLS)
Or if you prefer, try one of my recommended mobile budget applications. The important part about tracking expenses and budgeting is get going!
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Joanne David BA CFP FCSI
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