Budgeting Your Money – Methods to Track Your Spending

Budgeting can be intimidating. Hopefully, now that we’ve gone over the basics you are more comfortable with the concept.

There are different ways to budget your money. Every family is different and different methods will work for different people. The two main methods that I’ve seen be successful for people are the envelope method and the excel spreadsheet method. Both are great options, you’d just have to decide which would work better for your family. Of course, you can always do a mix of the two or a different one all together!

budgetingEnvelop Method

The envelop budgeting method involves envelopes and cash. Every month you decide how much you can spend on each item {ie: groceries, gas, entertainment, etc}. You then put that amount of cash in each envelope and write on the outside what it’s for. For that month you would only use whatever money you have in that particular envelope. When the money is gone, you’re done spending. Any money left over should go in a savings account.

This method is great for people who don’t have a lot of self-control when it comes to spending. You learn quickly that when your money is gone and you can’t buy any more food for the month, that you need to budget better. This makes you take a look at what you’re buying and makes it easier to cut out the unnecessary items. Did you go out to dinner too many times and ran out of money in your entertainment envelope but not your grocery one? Maybe next month you can eat in more and save that way.

Excel Spreadsheets

This is the method that I personally use. It’s more effective for me to see the numbers on a screen. For this method you would make an excel spreadsheet, a google docs spreadsheet, whatever works for you. On this sheet you would set up a category for every expense that you have that month and write down next to it what you expect to spend on that particular category. You can keep track of how much you actually spent, and how much you have left over.

This takes a little more effort because you have to keep all of your receipts and be sure to enter them in your spreadsheet every time you purchase something. I typically do this once a day for any receipts I had that day.

Here are some tips to keep you organized, no matter what method you choose:

1. Know what you have to buy. Sure, we all have the regular expenses – groceries, gas, etc, but think about anything special that you may have to budget for. Do you need to order contact lenses this month? Do you need to buy a birthday gift for someone? Is there a special occasion that you need a dress for? Are you going on vacation and need some extra toiletries? Is it your month to stock up on cleaning supplies? Think it through and take those things into consideration. It’s always wise to have a separate category for miscellaneous things that may come up.

2. Know your family and their food habits. Do you know that your husband has to have ice cream every night? Or does your daughter only drink almond milk? Take these things into consideration when deciding on your grocery budget.

3. Always check for coupons! I’ve talked about coupons before, and I’ll talk about them again. If you know you have things to purchase, make sure to look for coupons to help with the cost. Are you wanting to go out to dinner? Look for coupons in your local newspaper, or search online for them! Always know what you can save in addition to what you can spend.

4. You have to live within your means and not spend money on unnecessary things. If you know you have x amount of things to purchase this month, then put those at the top of your priority list. If you have money left over, then you have to decide whether you want to save it or get yourself a treat.

5. Stick to the budget you set for yourself. Don’t fret if you go over by just a few dollars ($5-$10), but try to stay as close to the amount you set for yourself as possible.  Not only will you be on your way to savings, but you’ll be so proud of yourself for your accomplishment!

Do you have any questions about budgeting? Feel free to email me: quarterpastnormal@gmail.com

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