What Should the First Expenditure in a Household Budget Be?
Developing a household budget is a good way to track expenses under normal financial conditions and to prioritize bills when your finances get a bit tight. Having a budget helps you to see where you can cut back on expenses to put more money into your savings or put money away for big-ticket items such as new appliances or a family vacation. To make sure you pay all your necessary expenses every month, you need to prioritize your bills.
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Housing
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Making your housing payment should be the first expenditure when it comes to your household budget, whether you rent or own. This is especially important if you are a renter because landlords can begin the eviction process if you are late paying your rent. A good way to figure your housing payment into your monthly budget is to divide the payment by your monthly pay periods. Then, set that amount aside every pay period. This helps to ensure that you will have enough money when your rent or mortgage is due.
Groceries
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Groceries are another major household expense, and you should consider your grocery expense as a weekly bill. Since the amount you spend on groceries tends to change every week, it's a good idea to estimate how much you spend each time you go grocery shopping. Once you decide on your estimated amount, you can figure that amount into your household budget. If your goal is to save money on groceries, try going only once a week, stay away from purchasing expensive pre-packaged meals and consider opting for the less expensive store brand rather than the national brand.
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Necessary Medical Expenses
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When making a household budget, all necessary medical expenses should be toward the top of your list of priorities. Necessary medical expenses include any prescriptions or medical supplies your family needs to stay healthy. For example, if someone in your family is diabetic, insulin, syringes and glucose testing materials are a necessary medical expense. You should not consider items such as multi-vitamins as necessary medical expenses when doing your household budget.
Household Utilities
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If you are doing a budget under normal financial circumstances, meaning you don't anticipate a drop in income or a dramatic decrease in expenses, then include all of your current household utilities in your budget, but list them by importance. For example, heat and electricity should be first, followed by cell phone bills, cable and Internet. Listing them by importance allows you to see where you can cut back should your financial situation change for the worse.
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