I feel like I spend a good part of my life budgeting. Not only do I complete all of the budgeting at work but I also do the majority of it here at home too. Dirty little secret, I enjoy it! Another dirty little secret, I haven’t always loved it and I haven’t always been very good at it. Budgeting is like anything; it takes A LOT of practice, some serious patience and some really good communication with your spouse.
It probably took me a good three to four months to get this budgeting thing down to a science. I now complete a monthly budget, Dallas and I review it together, and then I handle the execution of the budget each month. If something changes, when it does, we talk about it. We honestly don’t spend money without discussing it with each other first. We are 1000% committed to our financial goals, and that means we stick to a strict budget. It works for us and you’ll find what works for you too.
When we were paying off debt, we would pay off debt anytime we would go under budget in a category. So for example, if we budgeted $150 for groceries and spend $143.60, we would pay $6.40 toward debt. Yes, sometimes we would make that small of a payment toward debt. Seems a bit crazy but like is said, 1000% committed! We were RUNNING from debt as fast as we could and paying as much as possible toward debt is how to get out of debt fast. We’re now applying this same principle to saving!
Our budget is what’s called a zero-based budget, meaning we zero our bank account with each paycheck. We do have a $50 buffer in there just in case I mess something up, hey, math is hard sometimes! But in our minds, the balance is zero. This means we make multiple payments toward debt each month which doesn’t allow us to waste that money on anything else.
This girl is also old school and uses Excel for our budget. That said, there are a lot of really good apps out there that can do some great things and may make it easier for you. One of my goals for 2017 is to research those apps. Until I know more about those, I don’t want to speak to them, but those might be a good option if Excel freaks you out! A good ol’ piece of paper works too!
The first step is to write down all of your monthly expenses and due dates. The next step is to budget those expenses with each paycheck. So you’re going to align your due dates with the pay dates so that you’re sure to pay everything on time. Dallas gets paid weekly, and I get paid monthly, so we have five mini-budgets within our monthly budget. Below is an example of what one paycheck in the budget would look like.
Column A – Is your payment due date or check date.
Column B – The source of your payment or how you plan to pay.
Column C – The bill or budget category. You can also but who you owe here.
Column D – Put your income or bills here. Income is a positive entry; bills are a negative resulting in a zero-based budget.
Column E – To track the expenses as they happen. If one bill is less than budgeted, the rest should go to debt or saving. Also, if you have any money left from this paycheck, it should go to your debt or savings as well. Be sure you have a fully funded emergency fund before you start paying toward debt.
Column F – This column will calculate the remaining after column E is entered, the goal is for this to be zero at the end of each budget.
Column G – This cell calculates the bank balance as you work through this paycheck. It’s the sum of column F and should tie to your checking account balance.
***You’ll complete this process for the bills and paychecks you have for the month which will create one budget for the month.
You got it! I just implied that you should balance your checkbook. GASP! Ok, I am an accountant and balancing a checkbook is my thing, I do it frequently. If you can’t stand the thought of balancing a checkbook, set a budget, stick to it and then balance your checkbook monthly. It is important to make sure everything is balancing and jiving with the money you have in the bank.
If you’re interested in learning more about budgeting, the course, A Sunny Money Method is a game changer. The teacher, Sami Womack has laid out an incredibly easy to understand process to get you budgeting in no time! She provides tools, tips, and coaching that is sure to get your budget in tip-top shape! The course is excellent for any level of budgeter, I learned a lot from her course and I’d consider myself a budgeting pro! Take the course that I suggest to family and friends! Click here to get access and get 15% off because you heard about it here!
I hope this gives you an idea of how we budget and doesn’t make you want to crawl into the corner! Don’t like how I do it? The great thing is, you can find something that works for you! A budget is something that you can build to work for you and your family. The important thing is that you set a budget and you stick to it!!! I cannot stress that enough. There is no better way to waste money than to not have a plan! It also doesn’t matter what you spend your money on as long as you budgeted for it! A budget just helps you ensure you’re living with a plan and telling your money where to go!
Until next time, spend safely!
Need help or have a question?! Email me at email@example.com!
Note: I am not a personal finance professional. All of my advice is strictly opinion. I am not responsible for your success or failure. If you need professional financial help, please seek advice from a trained professional.
****Blog post updated Aug. 2017****
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