How to Make a Household Budget Plan Sheet

Using envelopes for daily expenditures will allow you to budget more effectively.

Creating a budget will help you to know where your money is going each month and will give you peace of mind that you are handling your money wisely if you stick to it. You will be able to plan your monthly spending based on your income and designate money for savings to help you prepare for long-term financial goals and to keep you from having to resort to using credit cards in the event of a financial crisis.

Things You'll Need

• Notebook or budgeting program software
• Pencil

Instructions

1. Write down everything you and your family members spend each month—even small expenses that seem inconsequential, such as ATM fees, that cup of cappuccino on the way to work, vending machine purchases and even postage stamps. This will help you see where you can cut costs before starting your budget.

2. Document the amount of money coming into your home each week.

3. Designate category names for each dollar that comes in, whether it is for entertainment, a car payment, college savings, groceries or the mortgage payment.

4. List in your notebook or online budgeting program all of the bills you pay each month.

5. Include expenses such as car insurance, taxes or other items that you pay quarterly, semi-annually or once a year. Divide these types of expenses by the number of months and add them to your monthly budget.

6. Write down miscellaneous expenses in your budget sheet. Things like haircuts, clothing allowances, vet bills and cleaning products all need a line on your budget sheet.

7. Include money for entertainment or allowances on your budget sheet. If you do not allow room in your budget for some fun, you will most likely give up budgeting in a short time.

Tips & Warnings

• Place money into labeled envelopes; this is an effective way to see how much money is left in each category for the week and will help you curb your spending.

• Clip coupons and watch sales ads for excellent buys on meat products. You will be amazed at how quickly each small savings adds up.

• Tackle credit cards with a passion by paying the minimum amount on each of them and putting extra money on the smallest. When the first card is paid off, apply that money on the second card and so forth until they are all paid off.

• Build an emergency fund so that you won't be tempted to use credit cards when unexpected emergencies occur.

• Give your budget time; many people only try it for one month before giving up. Allow three or four months to get used to the process. The effort will be well worth it in the long run.

References

• Bankrate: Secrets to Creating a Budget

Resources

• Dave Ramsey: Do Your Dollars Have Names?