Welcome back, y’all! This week, we’re going to make a budget. And start sticking to it.
The reason we spent two weeks on the last two pieces of homework – figuring out how much we spend, and determining what we need to save for – is because those are the biggest pieces of the pie when it comes to budgeting. We must have a grip on our spending and needs before we can put together a realistic and livable budget.
So if you haven’t done the homework yet, STOP – and go do it! Then come back to this piece, which is making your budget.
Depending on when you started the challenge, it might be the beginning of the month, or the middle of the month, or the end of the month. If this comes at an inconvenient time (I totally understand wanting to start on the first of the month), don’t let that stop you. You can still budget for the rest of this month. Your bank account will thank you! In fact, there have been plenty of times when we didn’t get to our budget until the month was halfway gone – and I can promise you, budgeting halfway through the month is better than not budgeting at all.
The point of your budget is to put every penny you make into an appropriate category. Many of those categories will be things you’re saving for, but remember this:
Every dollar has a place.
If you find that you have money left over once you’ve paid all your bills and and funded all the categories you’re saving for that month, you’ll want to put that leftover money somewhere, too (I suggest adding it to an emergency fund or paying extra on a credit card, but you’ll know what works best for you!).
We have lots of categories that we pay for with cash. This includes things like food, entertainment, and clothing, as well as things we’re saving for, like travel. Highlight those categories or put them together in one place on your budget so you can easily figure out how much cash you need to withdraw from the bank. Plan on pulling out cash once or twice a month, depending on your cash flow.
Our budget is monthly, but we break outrexpenses out into the first half of the month and the last half of the month. This helps us to understand our cash flow a little better, and makes it easy to know how much cash we need to pull from the bank.
Please take a look at the video below if you are not sure how to start. I walk through a sample budget using the spreadsheet from the Spend Well Budgeting System. If you have the budgeting system, you already have this spreadsheet. If not, don’t worry – I’ve included a printable budgeting sheet in this email that you can download and use for your budget. It’s a simplified version of the spreadsheet in the video, but watching the video (even just the beginning 3-4 minutes!) will help you get started on your own budget…no matter what format you’re using to create it.
Here’s your homework for this week:
Make your budget! No excuses, guys – set aside an hour (or two – it will probably take longer than you think). Grab your homework from the last two weeks – the list of your spending categories with how much you spend for each one, your list of upcoming expenses and things you want to buy, and your income – and put all that together in a realistic budget for you and your family.
A couple of things you don’t want to forget that are easy to overlook:
- Spending money (spending money can help you stay on-track – and if this spending money is in CASH, you’ll be even more careful with it!)
- A realistic food budget (if you’ve never meal planned or couponed, don’t give yourself a food budget based on how much you might save if you start couponing – be realistic, and don’t forget to take into account dining out)
- Clothing (it’s easy to not budget for clothes when you’re trying to save money, but if you have kids, you’ll want to be really mindful of this – new shoes can be expensive when you weren’t planning for them!)
Don’t forget to be flexible! If you’re new to this, it will take some time and some tweaking to get it right. That’s normal and that’s okay. Like anything, the more you do it, the better you will get.
Bring your questions and conversation to the Facebook group. If this is something new to you, it can be really helpful to ask questions and get support!
If you’d like a budgeting spreadsheet to help guide you, download your free budgeting spreadsheet below!
If you’re not a member of the Facebook group, you can join here.
Take 15% off the Spend Well Budgeting System with coupon code 60DAYBUDGET.
Here by accident? Hi! You’ve stumbled upon my 60 Day Budgeting Challenge. You can learn more here.