I recently sent out a survey to my totally awesome newsletter subscribers and a lot of you told me that one thing you’d like me to create is budgeting printables. I’ve been wanting to do this pretty much since I started the blog anyway, so here we are. 🙂
Here are some simple tips for setting up your budget and making sure that it’s successful. I’ll be referring to a “zero budget” here – a budget where every dollar is accounted for. Don’t forget to sign up for the free budget printables below either! 🙂
7 simple steps for setting up your budget:
Step 1: Use budget worksheets or spreadsheets.
One easy way to keep yourself organized and prepared is to use pre-made (or you can make your own, actually) budget worksheets or spreadsheets. If you’re like me, you prefer to actually write things down on paper. That’s why I created these super cool budget printables. You can get them delivered to your email if you just enter your info below! 😉
Step 2: Figure out + write down your monthly income.
This step is easy-peasy if you have a job with a regular, set income. But for those of us with irregular income, it can be more complicated. So if you’re one of the irregular income people, write down the lowest possible income you’ll receive.
For example, let’s say sometimes you make $500 (minimum) and sometimes you make $2,000 (maximum). Write down $500, because it’s better to underestimate how much you’ll make rather than overestimate. We’ll be figuring out what to do with any extra income later on in the post.
Also, remember to include your spouse/partner’s income if you share money!
Step 3: Figure out + write down all of your expenses.
You can take a look at receipts, recent bank statements, etc. to determine all of your spending info. To make it easier, think about it in terms of the following categories:
- Monthly bills – things like rent, mortgage, internet, phones, cable, water, car payments, etc.
- Regular, necessary expenses – things like groceries, gas, school/work lunches, etc.
- Extra expenses – things like your manicures, your Starbucks habit, dining out, movies, etc.
- Savings – any money that you put towards your savings, retirement fund, or saving up for a large purchase, etc.
After you figure all of this stuff out, write them all down on your worksheet or type them into your spreadsheet. Then write down how much money you spend on each thing every month. If you’re not sure exactly how much you spend, and then estimate as best as you can; you’ll be monitoring and adjusting your budget later on down the line.
Remember to (try to) put everything that you’re going to spend money on!
Step 4: Write down all of the debts you’re paying off.
Write down every debt that you’re paying off and then write down the payments you’ve been making, including interest rates. These debts can be credit cards, student loans, car loans, medical bills, etc. – anything you’re paying off!
Step 5: Subtract your expenses from your income.
Now that you know how much you’ll be making each month and how much you’ll be spending, it’s time to do the not-so-fun part. Subtract your expenses from your income and see if you’re even.
If you get a positive number, that’s great! You’re ready to skip down to the last step.
If you get a negative number, read on to the next step to see if you can fix it!
Step 6: Tweak it.
If your first try didn’t work – try, try again! There are a few ways that you could tweak it to make it work for you.
The (maybe) easiest way to do this is to evaluate where you’re spending your money:
If you’re eating out multiple times a week, do you really need to? Is there any way you could make dinner at home? There are tons of ways to save money on groceries and eat well on a budget. If you’re spending loads of money on clothes, books, music, or anything else that’s not a necessity, cut back your budget for those items. Continue looking at everything you’re spending money on until you can get your budget to zero.
Also, replacing certain bills with less expensive ones can definitely help you a lot. For instance, if you’re spending a ton on cable every month, consider switching to Netflix instead. If you’re spending a bunch of money on books, DVDs, or music, consider using your library – it’s free! Or if you’re spending a lot on your cell phone bill, consider switching to a more affordable carrier such as Net10 or Republic Wireless.
If cutting back on spending isn’t working for you, consider looking at ways you could increase your income. I have a whole Pinterest board dedicated to different side-hustles and work-at-home jobs that you could do in your spare time to earn a big chunk of extra money every month!
Step 7: Test it out + revise it.
Test out your budget to make sure that it’s working for you. Make sure you keep track of how much you’re making, how much you’re spending, your receipts, and/or anything else that will help you make sure you’re tracking every penny.
A cash-only budget will make this much easier because you’ll know exactly how much you have at all times.
At the end of every month, it’s a good idea to transfer or place any extra money into savings or towards paying off any debt(s).
Budgeting will get easier and easier, but you’ll probably have to update and tweak your budget regularly as you learn more about your earning and spending habits. Just make sure that you stick with it!
For even more free budget worksheets, check out this post from Freebie Finding Mom! 🙂
What’s your best budgeting tip?