Making a Budget

It is common sense to have some kind of weekly or monthly budget. Yet many people do not have one. It may be because they are 'afraid' of number crunching, saying that they were never any good at math at school, or maybe they just do not want to know how much they are spending every month. Whatever the reason, everyone should make a budget, so that they can see where their money goes.

Know Where You Spend Your Money

By making a budget, it is possible to see exactly what you are spending your money on, and make adjustments if necessary. Your budget will probably also show areas where you can save money.

You can use either a spreadsheet on your computer, or a notebook and pencil to write down your budget. If you want to use a spreadsheet, there are many online sites that offer free software for this. No matter how you choose to record your figures, now is the time to sit down and work them out!

Keeping Track of Expenses

One strategy that really works, but requires some effort, is to keep an envelop and a pen with you, and keep track of everything you spend over the course of one month. Making a little not on the receipt about what it was and why. This will help you discover what you are spending your money on and help you come up with budget categories.

How To Start a Budget

Begin by dividing your spreadsheet or notebook into two columns. On one side, write down all your regular monthly expenses. These may be food, gasoline, loan repayments, and other regular bills. Add a 10% buffer amount for unforeseen circumstances. On the other side, write down all your sources of income.

Simple Budget Spread Sheet



Principle Interest

Net Pay $1,600.00
Telephone $25.00

Cell $25.00

Groceries $300.00

Gasoline $300.00

Car Payment $150.00 $50.00

Credit Crd 1 $60.00 $40.00

Credit Crd 2 $120.00 $80.00

Totals $980.00 $620.00 $1,600.00

Monthly Surplus
Without Interest

Simple Budget Excel Spread Sheet Simple Budget Open Office Spread Sheet Open office is a free office suite available from

Learning From Your Budget

Now do the same thing again, but take out all your interest payments. This might be the interest that you are paying on a car loan, or credit card. This represents the amount that, in the future, you could avoid paying out every month.

Of course, you have to continue paying interest on your loans at the moment, but consider how much more money you would have available to you without these payments. This should lead you to think before you use your credit card, or take out a loan in the future. Are the extra interest payments worth having the item immediately, or would it be better to save the money and buy the item, and also save the interest payments?

More Budget Help

This is a decision that you will have to make in the future. But making a budget may be all that it takes to keep you on the path of being debt free.

If you feel you want more information on how to make a budget and follow it, we recommend Budget Stretcher's Money Help Store. The "Living Within Your Means - The Easy Way" (product #3) which includes a great 103 page ebook, a budget and bill organizer, a bill management system, and 11 budget & credit card calculating forms. The price is $29.95 which is affordable for all the information that is included.




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