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How Much is Enough? 5 Tips to Budgeting Your Household Expenses

Written by Savannah Marie, Community Blogger | Aug 26, 2014 3:28 PM

Knowing just how much money you need to manage your home is not as straightforward as it may seem. Without a budget, even the most frugal person is bound to overspend. Many people are intimidated by the idea of budgeting, fearing that it is too hard to begin or to maintain. Creating a budget is worth the effort, as you’ll soon find yourself being able to save money from month-to-month, all while managing your living expenses. Financial responsibility inevitably yields peace-of-mind.

Here are five easy tips that will have show you just how easy it is to budget and stick with it!

A few things you’ll want to have near while you work on your budget include:

  • A budget worksheet. You can find one almost anywhere. allows you to customize, fill-in and print a budget worksheet that fits your household needs.
  • Pen, pencil or computer
  • Calculator
  • Financial and billing statements

Once you have all these things in place, you can begin to develop your budget. This is where your budgeting sheet comes in handy. We’ll take it step-by-step, and you’ll notice just how simple the process is.


Start with Your Income

This should be any money earned on a regular basis. Wages earned from your job or business, alimony, child support and any other fixed incomes all qualify. If you’re self-employed, your income may vary slightly from month to month. In this case, just use an average income based on what you typically earn.


Total All of Your Expenses

These expenses will include anything you pay regularly: rent, alimony payments, child support payments, utilities, etc. Some of your regular expenses may vary, such as gas or groceries. You can handle this by identifying a maximum amount you plan to spend in that particular area. Maybe you anticipate your grocery bill being $200 a month, or gas at $180. Also be sure to include minimum monthly payments on debt.


Calculate Your Net Income

Do this by subtracting your expenses from your income. You’ll want a positive number from this calculation. You can use you remaining funds to save or pay down debt. If this number is negative, you know you’ll need to do some adjusting in either income or expenses. Since paring down your expenses will be a lot easier than increasing your income, start there.


Re-evaluate Your Expenses

If you are spending more money that you’re earning, you will have to see what bills and expenses are causing the problem. Which bills and expenses can be decreased or eliminated entirely. Many people consider cable television a necessity. But when money is tight, just how important is having cable television? If you’re a parent and your kids are preparing to return to class, you may have included the expense this entails in your budget. There are certainly ways to limit back-to-school spending, including shopping for items that are budget-friendly and on sale.


Watch Your Actual Spending

Once you’ve figured up your budgeting expenses, track your actual spending and record that on your budget worksheet. This will give you better understanding of where your money is going, where you are overspending and where you have expenses that you may have overlooked. The following month, adjust your expenses as needed and account for any spending that is outside of your budget.

Use your income, banking and billing statements to confirm the details of your income and expenses. You may be tempted to reward yourself by going shopping with your extra cash. But greater responsibility will show when you’re able to save, create an emergency fund or pay down debt instead.

That’s all it takes to developing a budget that will give you peace-of-mind and keep you living within your means. The hardest part is being honest with yourself about your spending habits and learning to fight the desire to spend unnecessarily. Budgeting is the beginning of financial freedom. And financial freedom is an integral part of complete well-being.

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  • Ava87 img 2014-11-05 07:26

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