Budgeting….Time to make a plan…

Budgeting

What is it about the word budgeting that gets people all worked up??   I hear, “we wrote a budget, but we didn’t follow it.”   Do you make plans to go out with your friends???   That is all a budget is.  It is a monthly “plan” of where you decide to spend your money.   That is the thing, you are in control!  You tell your money where to go each month.   There is no perfect budget or a perfect month.  So you will have to develop or tweak your budget each month.

  Dave Ramsey on Budgeting:

Remember last week I suggested you get all your financial statements/bills together?? It is time to grab that stack and get down to business. Let’s figure out what your monthly bills are. Make a list of each monthly payment and their due date.

Due Date

Expense

1st

Mortgage

1st

Xcel Energy

8th

Credit Card

10th

Student Loan

13th

Cable

28th

Credit Card

30th

Cell Phone

Add up the minimum amount due on each of these bills to get an idea of how much is due each month. 

Next decide on an amount for weekly expenses, such as Gas, Entertainment, and Groceries. These most likely will be your categories in which you will place cash in envelopes. (It is also not an exact science…you’ll have to live a bit while doing this to gauge your overall weekly/monthly needs.) We use cash or gift cards for most of our weekly expenses.   Our categories include Gas, Household, Groceries, Church, Our Fun Money and Tommy Pay.  We have weekly expenses because one of us is paid each week.  You might plan your expenses weekly like us, every two weeks or monthly depending on your pay frequency. More-often works best for us! (Keeps us honest before a shortfall can become a problem) 

Once you have your monthly and weekly/bi weekly amounts totaled, you now know how much money you need each month to remain living at your current level without incurring additional debt. If you don’t have enough money it is a good time to take a close look at your expenses and look for ways to cut your expenses and debt. It is also a good time to look at your monthly interest payments on that debt and imagine where you could be better spending that money! Obviously, we could also save money if we canceled our Cable TV. 

As scary (or enlightening) as it may be, you have just taken a huge step in changing your financial future by facing your debt.  Knowledge is power! It is now time to come up with a budget with your new knowledge.  Gone will be the days of wondering where your money went at the end of the month.  You will be intentional with your money and tell “your” money where to go!

This is a vital process and can be tense if you have not talked about finances alot in your relationship.  Stick with it, stick with each other, DO THIS TOGETHER, be kind to each other and tweak your budget each month until you come up with a workable plan.  

Here are some excellent forms we have found over time to help you get your start

Budget Forms from Dave Ramsey

Free Family Budget Form from Vertex 42 (Ecxel Document)

Free Monthly Household Budget from Vertex 42 (Excel Document)

 

We are excited for your journey!

Blessings…

Paul and Jen
A normal family trying to live like no one else!

 

Other Articles in our FPU Series:
FPU: Leap of Faith
Our FPU Story: That was then…..This is now
Financial Peace University

 

 

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