Welcome to week 1 of our 8 weeks to a Better Budget Workshop series! This week we are going to go over how to setup a budget, why you need one, and ways to keep track of it!
How to setup a budget
Getting started using a budget is something that is totally overwhelming. My husband and I have been revamping our budget over the last couple of days and I am really excited about our financial goals. There are steps you can follow when you are figuring out how to setup a budget that will help thing go smoothly and help you get on the track to financial freedom.
- Figure out how much money you have coming in and how much is going out.
Sit down and write down all of your income at the top – then write down under that, each of your expenses (house/rent, utilities, car payments, charity, etc). Then you will write down food, gas, and other expenses.
- Write everything down (or type it out) so you can keep track of each month and compare numbers.
This is a great way to keep track of what you are spending every month and if you go over budget one month, then you can roll that over into the next month. Keep a binder and put your bills and receipts in folder with your budget for each month, and keep them labeled by year.
- Pre-budget your money so you don’t overspend
Even if you don’t know how much money you are getting for each paycheck, you can take the lowest amount you can expect and put that in as your income – and go through and figure out your expenses for the month. If you have more money that you budgeted, you will be able to put that into savings or payoff debt.
- Review your budget weekly and monthly (at least)
Make sure you keep track of your budget regularly. This will make sure that you don’t overspend and you are staying on track. Do this TOGETHER with your spouse or roommate and you will avoid a lot of contention and fighting about money.
- Talk to your spouse or better half about any large purchases (I am talking like over $20!). Communication is a key to having a healthy budget (and relationship 😉 )