Budgeting Basics: Are Budgets Really That Bad?

What should a monthly budget worksheet include?

You’re probably bored of the thought of learning how to budget your money. You might also be thinking that your situation is unique and that you can’t budget your money. That’s incorrect. Your situation is likely very common. If you want to get rid of your student credit card debt or get on track with your money, this is the article for you.

Below are my best tips to help you grow and figure out how to budget your money:

Know your expenses on your monthly budget worksheet.

It’s obvious that stuff happens and sometimes we have to spend money that we had no clue we would be spending.

Aside from unexpected events, we for the most part should have a solid understanding of all of our monthly expenses.

The problem is that this is probably the worst part of budget planning because you have to take a realistic look at where all of your money is going.

To make things easier you should breakdown your expenses into two categories: fixed and variable expenses.

  1. Fixed expenses. These are the expenses that you have every month no matter what happens. You have to pay your rent every month, you have to pay your mortgage, you have to pay insurance, and you have to cover your other bills (cell phone, cable package, etc.).
  2. Variable expenses. This is everything else that you spend your money on. Anything from drinking, shopping, food, going out, all the way to purchasing new items.
Your monthly budget spreadsheet will help you figure out where your money goes.

Plan your savings.

We all have different savings goals and motivation for saving money. The trick is to pay yourself first.

If you follow the philosophy that you will go out first and then save the rest then I really doubt you will ever save anything. Savings come in all shapes and sizes- retirement planning, saving for a vacation, saving for a new car, securities (shares and bonds), real estate, and emergency fund. It’s obviously impossible to try to save for everything at once but it is crucial that you plan your savings based on your age and goals in life.

Are budgets really that bad? Not all but it’s a tough pill to swallow when you realize how much money you spend monthly and where the money is going.

Now you have your very own monthly budget worksheet. How are your numbers looking?

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