Use this worksheet to figure out how much money you have coming in, how much you have going out, and the difference between the two.
Download the Build Your Budget worksheet to begin this exercise. If you have a significant other who you share finances with, include them in the conversation as you work through the document.
Complete the left column of the worksheet and take note of fixed, flexible, and fun expenses in your budget. If your top expenses don’t reflect your top financial priorities, it might be time for a change. Identify which expenses can be adjusted to fund your financial goals.
Financial obligations you must pay each month that do not change. Examples include mortgage, rent, auto loan, child care and insurance.
Financial obligations you pay each month but tend to fluctuate or can be reduced. Examples include groceries, cell phone plan, gas, utilities.
These are expenses like activities, hobbies, and vacations. Examples could include dining out, movie tickets, or a concert.
Complete the right column of the worksheet to set spending and savings targets for the future.
Tips to stay on track
Use these tips to help yourself stay – or get – on track:
- Differentiate between needs and wants.
- Pay yourself first. Setup automatic allotments or direct transfers to make this easier.
- Each month is different, so adjust your budget to account for changes throughout the year.
- Budget for the most important categories first, which are usually large fixed and flexible expenses.
- Adjust payment due dates to help you better manage your cash flow.
- Create some space in your budget for life’s unexpected moments.
- Periodically review and cross-shop flexible expenses since they can often make a significant impact on your budget.
- Be sure to include fun money in your budget but set limits in advance for things like entertainment.
- Revisit your goals. How you budget your money is not as important as why you budget!
Tip from Steve Georgoulakis, CFP®
You don’t have to get ready, if you stay ready. Set a cadence for your budget inspection and stick to it. Each pay period? Each month? Don’t wait until you have a money problem to start budgeting.