Most people are paid weekly, biweekly, semimonthly or monthly. In most cases, your bills are due monthly. Without a budget, it’s easy to overspend on unnecessary items, which can put you in a financial bind when your bills are due. A budget helps you stay realistic about your financial situation so you can plan and spend accordingly. Whether you use an online budget application -- such as Microsoft Money Plus or BudgetTracker -- a spreadsheet program or a standard notebook, your monthly budget should contain some important common elements.
Determine your -- and if applicable, your spouse’s -- monthly take-home income. Your take-home pay is your income after deductions, such as taxes and voluntary benefits.
Include the month at the top of your new budget worksheet. Make a column for take-home pay. Create two lists of expenses: one for essentials and one for extras.
Write each type of expense under the appropriate column, starting with your essentials. For example, include mortgage/rent, utilities, car insurance, auto loan payment, gasoline, childcare, student loan, credit card repayment, and groceries under the essentials column. Under extras, put miscellaneous expenses such as new electronics, dining out, gifts, new furniture, donations and special events.
Add your essentials and extras lists separately. If your budget exceeds your take-home pay, review your extras list to see which items you can reduce or eliminate.
Keep your extras list realistic. For example, depending on your situation, clothing can be an essential or an extra item.
Open a designated bank account for the expenses in your budget; do not use it for any other purpose.
Put funds that are left over from your take-home pay after subtracting your budget expenses into a savings or investment account. Your bank can provide information on both types of accounts. If your employer has a 401k plan, consider contributing a small percentage of your pay toward it.