First of all, let me start off by saying that if you and your spouse haven’t sat down and created a family budget, you should!
Mike and I created a budget while we were engaged and have faithfully stuck to it (as closely as we can each month) for the past 6 months of our marriage. I truly believe that without a good budget in place, we would be grasping at straws towards the end of each month, rather than being able to save 10% + of our income monthly.
Where to Start:
There are a lot of online tools available (mint.com is one that comes highly recommended) to help organize your budget, however I have found that for me and my family, a good old fashion spreadsheet works the best.
I have ours broken out into very generalized categories, see below.*
Bill | Cost |
Car | $300.00 |
Gas | $200.00 |
Car Maintenance | $20.00 |
Rent | $1,000.00 |
Utilities | $150.00 |
Cell | $60.00 |
Household Supplies | $20.00 |
Personal Goods | $75.00 |
Entertainment | $100.00 |
Gym | $35.00 |
Dry Cleaning | $15.00 |
Insurance | $300.00 |
Food (groceries and out) | $350.00 |
Tithe | $400.00 |
Credit Card | $200.00 |
Health Care | $100.00 |
Stock | $50.00 |
Gifts | $100.00 |
Vacations/Travel | $100.00 |
Loans | $300.00 |
Total Spending | $3,875.00 |
Total Income | $4,200.00 |
* These numbers are for illustration purposes only and do not reflect our actual budget
You may have many more categories than I do, such as property tax, additional loans, kid’s expenses, mortgages, monthly membership fees, ect. It is very helpful to do an inventory of your monthly spending for 3 months back (I just looked at our bank statements, as we did used to never use cash). Make sure to include every reoccurring bill on your list. (Don’t forget extras such as hair color or cuts, charities, your annual Girl Scout cookie stock up, make up, ect!)
If you are having a hard time thinking of every category, click here for a fairly exhaustive list of categories!
From there, you want to calculate out how much you spend per month on these items. Some of the items, such as vacations, car expenses and gifts are not items that we spend money on every month. What we like to do is set aside some money, so that when our breaks do go out, or a birthday heavy month comes around, we aren’t scrapping the bottom of the barrel, but rather we have the money already saved away!
What I do next is add on additional columns, see below:*
Angela's Paycheck | Mike's Paycheck | |||||
Bill | Cost | Pay Check 1 | Pay Check 2 | Pay Check | ||
Car | $300.00 | $300.00 | ||||
Gas | $200.00 | $100.00 | $100.00 | |||
Car Maintenance | $20.00 | $20.00 | ||||
Rent | $1,000.00 | $1,000.00 | ||||
Utilities | $150.00 | $150.00 | ||||
Cell | $60.00 | $60.00 | ||||
Household Supplies | $20.00 | $20.00 | ||||
Personal Goods | $75.00 | $50.00 | $25.00 | |||
Entertainment | $100.00 | $50.00 | $50.00 | |||
Gym | $35.00 | $35.00 | ||||
Dry Cleaning | $15.00 | $15.00 | ||||
Insurance | $300.00 | $300.00 | ||||
Food (groceries and out) | $350.00 | $175.00 | $175.00 | |||
Tithe | $400.00 | $200.00 | $200.00 | |||
Credit Card | $200.00 | $200.00 | ||||
Medical Expenditures | $100.00 | $50.00 | $50.00 | |||
Stock | $50.00 | $50.00 | ||||
Gifts | $100.00 | $100.00 | ||||
Vacations/Travel | $100.00 | $100.00 | ||||
Loans | $200.00 | $100.00 | $100.00 | |||
Total Spending | $3,775.00 | $1,250.00 | $1,275.00 | $1,250.00 | ||
Total Income | $4,200.00 | $1,300.00 | $1,300.00 | $1,600.00 | ||
Left Overs | $425.00 | $50.00 | $25.00 | $350.00 | ||
* Again, these numbers are for illustration purposes only and do not reflect our actual budget.
The next step is figuring out how we can realistically pay all our bills while still putting some aside for our savings and having a small cushion for any unexpected spenditures.
What I do is break it down by paycheck. I get paid twice a month, and Mike gets paid once a month. Therefore I create two columns for myself (my first paycheck of the month, and then my second) and one for Mike.
Angela's Paycheck | Mike's Paycheck | ||
Pay Check 1 | Pay Check 2 | Pay Check | |
Then I figure out what bills have to be paid with what paycheck.
For example: I know that our utilities are all due around the first of the month, so all our utilities money needs to come out of my first pay check, or I know my car bill is due around the 20th of the month, so I know all that money needs to come out of my second pay check. This will vary for everyone depending on how your bills come.
Then, once all your “set in stone” bills are placed on the chart, fill in ones that may be best split in half. By this I mean things such as gas money, grocery money, entertainment money, ect. These are things that we will use all month. I find if I take all my grocery money out from the first paycheck, I will have spent it all by the time the second pay check comes around, and then we aren’t able to buy the things we need towards the end of the month.
It helps me to be able to pull “x” amount from the first paycheck, and then again, pull out “x” amount once I get paid again. You can determine your own will-power on this and what would be best for your family.
Lastly, I go and fill the “extras”. These are things like Personal Goods, Car Maintenance, Gifts, ect. These are options that can be flexible. I will arrange these by paycheck according to where we have money left to pull from! (Use the Excel formula =SUM(X4:X23), enter your column letter and numbers however to create a running total in the Total Spending columns)
If you noticed on the bottom of my spreadsheet I also included our total income, along with our total spending and then have a “left over” column. This helps me to know how much money we have to spend during that period as I am filling in the chart. I do this with the simple Excel formula =D27-D25 (use your own column letters and numbers, it should be your total income minus your total spending columns)
Total Spending | $3,775.00 | $1,250.00 | $1,275.00 | $1,250.00 | ||
Total Income | $4,200.00 | $1,300.00 | $1,300.00 | $1,600.00 | ||
Left Overs | $425.00 | $50.00 | $25.00 | $350.00 |
Hopefully at the end of the month, you will find you do have some left over money. If you find that you are in the negative, it is time to rethink your spending. Are there areas you can cut back on such as entertainment? Eating out? Retail Shopping?
While it may be hard to adjust your spending to your income, the relief that comes from knowing you have a cushion and some money in the bank is DEFINITELY worth it. Mike and I are on a super tight budget (we want to buy a house so we are trying to save every penny!) however, I haven’t stressed ONCE about an unexpected purchase or bill, because we have planned for these things and have also put money aside to cover expenses.
If you do have money left over at the end of the month, stop and gives thanks to the Lord for providing you enough to meet all your needs. God is gracious to provide when we put our hope and trust in Him alone!
I’m not saying that we never go over budget, or that it is easy staying on a budget. What I am saying is that the rewards of careful stewardship is one of the most rewarding things my life. It is great to see that all our hard work is paying off and that we are making smart, though-out choices with our income. Even the bible has something to say about this:
Proverbs 21:5
“The thoughts of the diligent tend only to plenty; but the thoughts of everyone who is hasty only to poverty.”
“The thoughts of the diligent tend only to plenty; but the thoughts of everyone who is hasty only to poverty.”
I encourage you to prayerfully consider a budget for your family if don’t already have one in place. I strongly believe that the Lord wants requires us to be diligent stewards or our income so we can more freely give to His people and towards His Kingdom.
If you have any further questions or would like additional resources, please feel free to email me or leave a comment!
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