Today Pete lays out exactly how to create a budgeting spreadsheet. It’s extremely simple, follow along here:
Why You Budget Matters
Budgeting is a good idea for everyone, but understanding the why is important for long-term success. Have you tried to budget before? Many have and don’t stick to it long-term. Here are the three keys to budgeting success:
People who consistently check their checking account balance spend more money. Prior to online banking people were more aware even though they didn’t have access to their balance constantly. Awareness is only increased when you know what you’re spending without actually looking. This is about being aware of bill timing, how much you are spending at stores and on dining out, etc.
Talk to your partner. If you aren’t communicating about who is spending what it doesn’t really matter if you’re aware. If you’re having trouble communicating, use Hey Money as a mediator. Our experts can help you set goals together as a couple.
Accountability is necessary for success. If you and your partner agree to spend less on dining out next month. Sounds smart, yet how will you know you succeeded? Goals need to include a specific dollar amount or percentage and have a clear timeframe or deadline. Clear, concise, actionable.
How to Create a Budget
Creating a budget has gotten a reputation of being complicated and expensive. From apps to software to financial planners, you can spend a lot of money creating a budget or you could just use a spreadsheet. That’s what Pete does and it’s worked for him for decades. Here’s what you need to get started:
- Bank statement (checking account, credit card statements, receipts from cash)
- Spreadsheet (Excel, Google Sheets, Numbers, etc.)
- OR paper and calculator
This is a rough version of what yours could look like:
Your budget will be personalized to you. Column 1 will be all the different expenses you have each month. Some are specific like the medical bill payment from your dental surgery and some will be more general categories like groceries. Across the top of each column you’ll list the months of the year. The items that are fixed amounts can be dragged across all the months. Other categories will be more complicated and will need to be updated each month.
That’s it! That’s your budget. You can use the free budgeting worksheet you’ll receive when you sign up for our email newsletter below to help determine if your monthly spending is “normal”, or to identify categories that need some work.
For more personalized guidance don’t forget that a Hey Money expert is always ready and waiting to help you sort out this mess. Use code ‘cheese’ to get a 10% discount on a monthly subscription just for being a part of the 30 day recession-proof your life program. Stay strong!
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