How to Budget Your Money: Part 1

In this series, we provide readers a step by step process on how to create a budget and how to maintain your personal budget. If you live pay check by pay check, do not have money in a savings account, or if you are not putting money back for retirement, you need to start now and take control of your financial future.

If you haven’t already do so, I also recommend reading Winning at the Financial Game.

 

Create a Budget Form

It’s not as important how you create your budget, but that you actually do create a budget to help you properly manage your money. I’ve seen people keep track of their budgets using a notebook, or column paper to help them keep things more organized. You can even use pre-printed budget forms that has a sheet for each month and already list the most common monthly expenses. How you manage your budget is entirely up to you, as long as you create a budget. I personally like using a spreadsheet and setup a tab for each month. It makes things easy to change and if you have some basic spreadsheet skills, you can have the spreadsheet do the math for you.

To start off, let’s keep things simple by creating a basic budget form. Grab a sheet of paper and make five columns down the paper. Now going across the top of the paper, label each column: Description, Monthly Income, Monthly Expense, Balance, and Actual. I’ve included a example of how a basic budget for should look.

Description	Monthly Income	Monthly Expense	Balance	Actual
My job	$2500		$2500
Mowing Lawns	$200		$2700
Bonus	$0
Rent		$800	$1900
Utilities		$160	$1740
Fuel		$80	$1660
Food		$500	$1160
Total	$2700	$1540

Continue reading How to Budget Your Money: Part 2