How to Set Up a Personal Home Budget Plan
Calculating the monthly personal home budget can be time-consuming and frustrating, but it can help you see just where your money goes every month. Whether you are employed or unemployed, you need a budget to make sure that you have money to pay everything that needs to be paid and still have money for groceries, entertainment, clothing and unexpected expenses. However, you need to set up a personal home budget correctly for it to work.
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Instructions
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Track your expenses for an entire month. Write down every penny that you spend and what you spend it on. Use a spreadsheet to do this so that you can compare the spreadsheet to the monthly budget that you will construct in the second month. At the end of the month, look over the spreadsheet and note whether you have any money left over.
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Set up a spreadsheet starting with monthly income. Use four columns with heading to include type, planned, actual and difference. For instance, salary, child support and alimony should be included under type. The planned amount is in Column 2, and what you actually received for the month is in Column 3 and the difference as a plus or negative amount goes in Column 4. Make a row to total the income columns.
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Skip a row and write expenses in the type column. Start with your mortgage or rent and enter the planned amount for the month. Add all expenses, including some of the little things that you wouldn't normally budget money for, such as stamps or beer. Look at the spreadsheet for the first month where you documented everything you spent, and make a miscellaneous expense or document each individual expense.
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Add up the planned columns right away. If you see that your income is lower and your expenses are higher, you can now cut some expenses. By doing this, you can live within your income means and avoid going into debt or falling behind on the expenses that matter.
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Enter the actual income amounts and expense amounts that you paid during the month and calculate the difference. You will be able to see where you can make changes, according to the difference amounts and the income.
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Tips & Warnings
Use the budget template in the References section to give you an idea how to make the layout of the spreadsheet.
