How to Make a Budget in Excel
Managing your personal finances can be a difficult and time-consuming task. There are few things more frustrating than discovering that your bank account is overdrawn or that an important check has bounced. In addition to the basic expenses, such as a house or apartment, utilities, groceries, and gas, many of us have credit card bills, cell phone bills and even reoccurring monthly subscriptions draining our finances. Maintaining a careful budget is extremely important to a healthy financial life. Keeping track of your income and expenses can help you to clearly see where you money is going. Armed with this information, you may be able to cut some of your expenses and save for an important future purchase. The first step to financial security is making a budget. Armed with Excel, this can be completed in a few easy steps. Once you have put together a budget, maintaining it is simple and Excel does all the math for you - leaving you in control of your money.
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Instructions
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Setting Up a Spreadsheet
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Decide how often you want to manage your budget. You may want to calculate your expenses daily, weekly or even monthly. If you have trouble with frequently overdrawing your accounts, or losing track of where you spent your money, a daily budge is a good idea. If you get paid weekly or biweekly, and only spend money on regular bills and a scheduled shopping trip, a weekly or monthly budget may suffice.
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2
Lay out your spreadsheet. For a daily budget, you can simply create a calendar. For a weekly budget, you will only need four sections per month. Each section should have four lines. Label these in the far left column. The top line is for the date or dates. The next three lines are for income, expenses, and balance. Each box should also have two columns. One will be used for the monetary amounts, while the other is available for you to note how you calculated that amount. You may also want to add a title at the top for the month, and a box to the right with the beginning balance for that month.
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3
Insert the proper formulas. The balance section of each box should read: =SUM (previous balance + income-expenses). The words will be replaced with the row and column of the appropriate box. The first box should refer to your beginning balance for these calculations.
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4
Estimate your income. If you do not have a set income because of freelance work, varying hours or commission, estimate on the low end. It is always better to be surprised with extra income than to be caught without enough funds.
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Estimate your expenses. Refer to your most recent bills and credit card statements. You should also look at your last month's worth of gas and grocery receipts to estimate an average expense, and figure out how often this expense occurs. For your expenses, you should always estimate on the high end. Don't forget to add in extras, such as the occasional soap and shampoo purchase, that can significantly increase that week's grocery bill.
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Enter your estimated income and expenses in the appropriate boxes. The automatic calculations should let you know if you have money left over, or if you have theoretically overdrawn your account.
Maintaining Your Budget
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Update your budget with actual amounts. Set aside a specific time each day, week or month to replace your estimated expenses and income with the actual amounts. Your calculations will automatically update as you enter these numbers.
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Compare your bank account with your budget. The balances should be the same in both your bank account and on your spreadsheet. If they are not, go through the details until you can pinpoint the discrepancy.
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Set goals. You can add additional boxes on your spreadsheet to note upcoming goals and how much you need to save for them. This should help you stay motivated to save more and maintain your budget carefully.
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Tips & Warnings
If you are familiar with Excel, you can add calculations for how long it will take you to pay off a credit card or save for the down payment for a new home. Seeing a set number of months on these goals may make them seem more achievable. Keep everything up to date. Letting your numbers slide can give you a very inaccurate picture of your finances.
Double check your calculations. One wrong letter or number can throw your whole spreadsheet off, so enter a few test numbers first to make sure everything is working properly.
