Important Budget Categories for Every Family

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I’ve known for a while now that there are suggested budget categories and percentages to income for each category.  Why it has taken me so long to write this or compare our budget to the suggested percentages is beyond me.  We recently did a no spend week which sparked my curiosity.  I learned during that week that we spend way too much money on groceries.  To be honest, part of me was scared to put these percentages down for fear that we’d been blowing it this whole time.  So naturally, I’m sharing the results with the world!

Before we compare the percentages, let’s talk a bit about budgeting itself.  First and foremost, budgeting doesn’t have to be complicated.  I say that because I am the queen of overcomplicating things!  Shocking right?  Your budget is yours so make it work well for you.  If you want to get super granular with budget categories, awesome!  If that makes your head spin, simplify it! For example, I don’t have a cleaning supply budget category and a grocery category… it’s all grocery in my world. 

If you’d like my budget templates (which includes a debt snowball example and a check register), click here and subscribe.  The site will auto email you the templates and instructions on how to use them!

If you get to the point where you’re ready to compare your budget to these percentages go into it with an open mind.  You might find areas that need improvement or areas where you’re killing it.  Either way, use the information to improve where you’d like to be financially.  Don’t use the information to beat yourself or your spouse up.  Knowledge is power as long as you use it correctly. 

Now for the comparison… drumroll, please.  Just kidding! I found the suggested percentages on Every Dollar’s website.  See link below the table.


Every Dollar Percentage of Overall Spending

Our Family Percentage of Overall Spending































Now, let me break down these categories for you and give you an idea as to why ours are where they are.  These numbers are based on take-home pay, so keep in mind this is talking all post-tax.  And I only reviewed the month of January 2018.  This will likely change month to month for each family.

Giving: This is our most important category.  I’ve talked about tithing and giving many times before. If you want to read about that, click here for the article.  We have given at this level for years now and don’t plan on stopping anytime soon.  If anything, we’ll increase our giving because we’re not only called to do so but because giving will keep us focused on what’s important. 

Housing: This category is either your mortgage or rent.  We’ve been very blessed to have extremely affordable rent in our area which has helped us achieve other goals.  While we are extremely grateful for this, we’ll definitely be buying a home within the next six months so I fully expect this to change, drastically.  If your housing category is way higher than the suggested, that means you’re “house poor” and you might need to consider alternative housing.  Sorry, that’s tough but true.


Utilities:  This category doesn’t need much explaining but I will say, this is one area you could probably improve pretty drastically.  Cut the cable, if you group that expense in with utilities.  Otherwise, find ways to conserve water like a water conserving showerhead.  Or start using high-efficiency bulbs and cut the A/C or heat to a minimum.  This is a category that gets easily out of control but can be reined in pretty easy too. 

Food: I was terrified of this category.  After the no spend week earlier this month, it was clear that we need to eat the food we have on hand before we buy anymore.  So I assumed that we were spending like crazy here.  Keep in mind, this is a category that will vary depending on the size of your family.  There are only two of us so the cost should be pretty low.  If you find that your food budget is out of control, start making a list (I live by the one below) and sticking to it at the store. Oh, and use cash only!  Those few steps could really save you a heap of money.  Also, give meal planning a try, that’ll help a bunch too!

Transportation: This category will vary monthly.  It’s not only your fuel but your car registration renewals, vehicle maintenance and anything else that comes up vehicle-related.  If you have a car payment, it goes into this category too. By the way, if you have a car payment, get that thing paid off pronto!  If you have a high car payment or a long-term loan, consider selling.  You need a reliable car to get you from point A to point B.  You can always buy a “safer” or nicer car when you can actually afford it.

Health: Use this category for any medical co-pays, prescriptions, even over the counter meds.  I typically group this into grocery but if you have kiddos or health issues, you really should be budgeting for this monthly.  That way you’re not dipping into your emergency fund each time your kiddo needs to head to the doctor.  If you can, participate in a High Deductible Health plan that allows you to contribute to a Health Savings Account (H.S.A).  I talk about H.S.A’s here and I love them!

Insurance: This category is critical!  You probably have insurance on your cell phone, so you darn well better have it on yourself and your assets!  Aside from Health Insurance (which my employer covers at 100%, an incredible blessing!), you really need to have life insurance, auto insurance, short-term disability and an umbrella policy to name a few.  I break down insurance coverage in this article if you need more information.  Also, if you haven’t shopped your insurance recently, its time!  I suggest you shop your insurance annually or every two years in the least.

Personal: We use this category for haircuts, clothing and our gym membership.  There is a lot of wiggle room in this one!  If you need to cut expenses, start here!  There are a lot of great clothes at second-hand stores, no one will know that you’re wearing something second hand. Trust me! Try DIYing your manicures and pedicures, I’ve done this for years.  And if you have a gym membership that you are not using, get rid of that bad boy!  We only recently got a gym membership and make sure that we use it to justify the cost. 

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Recreation: We use this category for our weekly date night and any fun events we want to go to like concerts, plays or the movies.  That said, this one is not a requirement.  Yes, if you are working on getting your finances in order, it’s important to let a little air out of the balloon every now and then. But you can keep these expenses to a minimum if you’re building your emergency fund or paying off debt.   

Saving: I bet you can’t guess what goal we’re working on right now?!  This category tells me that we are living on 41% of our income and saving 59%.  That is crazy.  I had no idea we were going this nuts with saving.  We have a fully funded emergency fund but we’re saving for a down payment for a home so this category should be high for us.  If you’re paying off debt, or living paycheck to paycheck, this category might be zero for you.  That’s ok!  Once you’ve paid off your debt or gotten on a steady budget you can work on growing this category.  When we were paying off debt, our savings category was zero and our debt pay off category was probably around 59%.  Budgets are fluid and are ever changing with your goals, which is the whole point right?!

A few things to note, go through this exercise and compare your percentages to the suggested percentages from Every Dollar.  Do NOT compare yours to mine.  Our lifestyles are different, our income levels are different and our goals are different.  It’s really important that you use this information wisely and not tear yourself down because of what someone said on the internet. 

Now, if you do this comparison and are disappointed with the outcome, you can work on changing things over time.  Adjust your budget in that certain category by a percentage or two each month until you get to where you want to be.  It’s ok to make gradual progress.  Sometimes that gradual progress is more sustainable.  Give yourself some grace and work toward where you want to be! You’ve got this!

Until next time, spend safely!


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