Budgeting, where do I even start?

The first time my husband and I sat down to do a budget together, I wrote some numbers down on a yellow legal pad and then promptly misplaced and forgot about it. The next time we tried to do a budget together, it looked more like Zach sitting in his comfy desk chair with an excel spreadsheet telling me what the budget was going to be while I stood behind him uncomfortably. Needless to say, our budget process had a rocky start.

Luckily, we figured it out– although it was years later.

As I have said before, we are Dave Ramsey fans. We use a smart phone app for our budget with a shared account, so that we can both access it from our phones. There are many, many options to choose from and I’m sure a lot of them are great, but we use Every Dollar. It’s free and it’s a Ramsey product.

We start our budget with our income. You won’t have any idea how much money you can spend if you don’t know how much money you make! For many families, this should be pretty straightforward. For some, income is variable from month to month. Ours is. The way we work that is to only include the amount that’s a sure thing. We pretty much go as bare bones as possible on that.

Once you know, and have recorded, how much money is coming in for the month, you can begin to decide how you will spend it. It’s important to take care of your basic needs first, so assign dollar amounts to

  • groceries
  • housing
  • electric/water/utilities
  • transportation.
  • savings for an emergency fund of $1000- stop this line once you have your $1000.

Once you have the necessities taken care of, you can add in any debt payments you have, such as

  • credit cards
  • personal loans
  • car payments

If there’s any money left over, you can add in some fun line items such as:

  • restaurants
  • sports/entertainment
  • shopping/clothing
  • saving for a vacation or a larger purchase

This system has been working for us for about a year now. It’s not always perfect, and sometimes we just mess it up. The key is to make a new budget each and every month. Do it with your spouse/partner. Keep your long-term goals in mind. It can be intimidating at first, but you can do it!!

 

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