I need to start by saying having a budget and sticking to a budget are two different things. We have a budget, and since I am nothing but honest, I’ll admit that sometimes we stink at following it. I don’t have any excuses but to say that it isn’t easy!
When I first started to create and implement a budget, I ransacked the internet looking for advice and systems that others have used. I tried enveloping, and I’ll probably try it again. It sounds like such a good idea… if you can remember to stop at the bank before you go to the food store which I never remember to do. I’ve tried apps and software which were all too complicated and cumbersome. I’ve tried just putting everything on automatic payments and crossing my fingers (not recommended).
Finally, I hit upon a simple method that works for me. It has two parts -- a homemade spreadsheet and chart. The spreadsheet (above) lives in Google Drive where I won’t lose it or spill coffee on it. You can see I have information about our bills followed by a column for each month. I put notes on the bottom like when our next car payment is due since we pay ahead. When I pay the bills for each month, I write in the amount I paid. We keep some bills on autopay -- our car insurance gives us a discount for having autopay, the boys’ health insurance is too important, and the Time Warner Cable website gives me hives. This part of my system helps me track which bills I’ve paid and which are coming up.
The paper chart is kind of like a rough copy of the digital. Once Damian’s paycheck hits our account, I pull out a calculator and start with our account balance. I deduct all the bills I need to pay out of that paycheck. I pay them online as I go, and I write in the amount I’m paying on the chart and in the spreadsheet. Some rows are left blank because a bill might not be ready to pay yet. Any leftover money, if there is any, gets allocated towards extra expenses or put towards our debt. At the end, I double check my work by adding up all the numbers in the column and check it against our account balance. This is why the chart is necessary. It shows me exactly what is coming out of one paycheck. Then I’m done for two more weeks!
I also use three simple strategies to help manage our budget.
Don’t pay bills when their due. Pay them with money from the paycheck you get after their statement becomes available. This way you’re never late, and you’re always a little ahead.
Split the expense between two paychecks for larger bills like rent. This takes the some of the bite out of those larger bills.
Budget all of your money. Know where every little bit should go. If you are lucky enough to have extra cash, put it towards a vacation fund, savings, or retirement.
Budgeting isn’t fun. It isn’t glamorous, especially when the you’re struggling financially, but it doesn’t have to be complicated or difficult. Sticking to it is the hard part!
Welcome to the family!
We are a laid back, fun, family of four living on a dime in 900 square feet. Life might not be perfect, but every moment of every day, it is beautiful.