So, I’ve shared my meal habits and now I want to share my budget. This is something that I made after reading Dave Ramsey and being raised by my parents who instilled money management skills in me.
What I’m going to do is share my actual budget with the actual figures with you so it’s more realistic (I am NOT trying to show off the amount I make, I just wanted to keep it real) and then I’ll break each category down. It’s going to look completed at first glance, but I promise it’s really simple. The reason that I am sharing this is because I have created something that works really well for me, so if you are struggling with making a budget, or have a desire to make a budget, or just want new ideas for your current budget, then buckle in and pay attention. You could also go to everydollar.com and make a budget that you can manage from your phone. It’s even based on Dave Ramsey’s teachings. I considered using it, but my income fluxuates and I didn’t want to have to keep adjusting the figures. Plus, I already created mine. Also, if you would like for me to make you an excel template similar to mine, please let me know and I’ll be happy to do it!
First, let me explain why the numbers are not the same for each pay check. I started the beginning of the year full time then dropped down to part time because there is simply not enough work for me and I felt guilty that I was take more money than I was doing work. I fluctuated my hours for a few weeks until I finally settled on 25 hours a week. In addition, I tutor on the side for extra money, so my bi-weekly income changes based on how many hours of tutoring I was able to do. In the future, I may switch to the everydollar budget since I could manage it from my phone, but for now, this works best for me.
Like I said, it looks complicated, but it’s not. Every two weeks I add my income (salary from job + tutoring money) into the appropriate spot, and the excel formulas do the rest: everything is automatically calculated (I do have to pull over certain items) and distributed to the proper category sections.
You can also see that some of my budget items are percentages while some of them are fixed. I like to put everything that isn’t a fixed item (such as rent and bills) as a percentage because my income changes so much from month to month.
Now to break the whole thing down. First, the “Emergency Fund.” Dave Ramsey suggest having at least as much money as you would need to live off of for 6 months. This is in case you get laid off. Okay, he said 3 to 6 months, still. Obviously I have way more than this. A good chuck of it came from inheritance from my grandparents on both sides dying (Yes, sad. I’d much rather have them than the money). The rest came from money my parents made me put away as part of my allowance as a kid and summer jobs I had in high school and college. If you’d like to know more, see my first post about budgeting when I was first starting it here. The reason I have kept is so high is this is money to sustain me if I’m between jobs, cover any major medical expenses, car repairs, vet bills, and even a new car if mine were to get totaled in a terrible accident. Basically, if life tries to through me some shit, I’ve got this.
The title shows that $25,000 is my goal. It’s just a nice round number. You can also see that my cat almost died and my boyfriend had to have some major repairs on his truck (which he will pay me back for, there’s just some legal stuff going on because they people that “fixed” his truck did a lot of unnecessary work and didn’t fix it, so we had to take it somewhere else – long story). I put all the money I got back from taxes (I got so much back because I was a student for half the year last year) all went into filling that fund back up. The “leftover” is money that I had left over after all budget items were accounted for.
Now I’m going to show you a break down of each category. The “subtotal” automatically comes from the sum of all the amounts in that category going across. It automatically increases every time I enter in my bi-weekly salary. Then I just hit -## for whatever I spend money on, and it totals what I have left at the bottom. There are formulas in all these spaces so I don’t have to do a think but enter what I make and enter what I spend. I’ll usually spend 5-10 minutes each evening entering in any purchases.
I invest money in a Vanguard mutual fund account. About once a month I’ll go on and buy stock in VTSMX based on my Aunt’s recommendation (who is really good with money and has been doing this for YEARS). I like to enter in when I invest, so I know that I have done it. Otherwise, I’m likely to forget and either not do it or do it twice by accident. Although my goal is 10% of my money, if I have money left over after all my other budget items are taken into account, I’ll increase that percentage. This is money I hope to use to buy a house one day 10 or more years from now.
My parents taught me to donation 10% of my money by designating 10% of my allowance as “church money.” I still uphold to that and you can see the different things I have donated money to. Often if I’m making a purchase somewhere and it asks “would you like to donate to ____” I’ll hit yest for 1 or 5 dollars and either take it out of free spending or donation.
Now that I’m a working adult, I feel obligated to contribute on family vacations. Not only that, but I’d like to take small vacations of my own. I used money from this for my recent trip to New Orleans – I paid for my part of the hotel and withdrew a certain amount in cash that was my budget for that trip with this category. I also plan on paying my part if I get to go with my family on their annual beach vacation and again at Christmas when we get hotel rooms in Birmingham for a few days.
Free Spending covers going out to eat, shopping, going to the movies or a play, entrance to the zoo, aquarium, or a convention, etc. This includes clothes that I don’t need, but want to have. Work clothes, tennis shoes, new jeans, and any other clothing items that I actually need come from a different category. Since this is the most used category, I keep up with it using an app on my phone called “Spending” by MH Riley. It’s great. I have categories like “eating out,” “coffee,” “movies,” and “shopping” so I can see where all my free spending money is going. Extra gas money comes out of here too, but that’s usually not a problem unless I visit my parents two weeks in a row.
Short term savings covers more costly items that I plan on buying. This may include furniture, work clothes, kitchen items, organizational items, hangers, a vacuum, etc. Due to me being a little careless and the boyfriend being gone (who usually buys the food), I went over my free spending and used short term savings to balance it out. This is still a new budget, after all. I’m getting better at it. You can see the next items I plan on buying with this budget item.
Gifts includes all holidays: Birthdays, Mother’s and Father’s day, and Christmas. These things happen at the same time every year, but a lot of people don’t plan for them – hoping to rely on bonus checks to cover it. By putting in just a little each pay check, I’ll have a nice pot to pull from come Christmas. I’ll be using it to buy a mother’s day present soon. Also, I just decided to up it to 2%, so you’ll see that April got a little more.
Pet and Medical used to be grocery (as you can see), however, that’s something the SO took over, so I have lowered that budget item and use it to buy cat food, snake food, cat litter, and snake bedding, as well as any pills I need or doctor visits I take. I get sick often, but I only go to the doctor if I’m bad sick or it last more than a week. I also occasionally buy beer and some groceries, if we just need a couple of items.
I have a car that has great gas mileage and I live close enough to work that I can walk or ride my bike (if I’m not running late or being lazy), so I only use gas when I go to tutoring or go do something fun (which is why if I go over my gas budget it comes out of free spending). I try to budget enough that I can visit my parents often.
Utilities was the trickiest one because it changes every month. As you can see, I started off by budgeting too much, so I backed off to a more realistic number.
The main reason I show internet and cell phone bill is so I can keep up with when and if I have paid them. I didn’t show them at first, and I forgot to pay my cell bill one month (oops), so it’s just nice to see if I did and when I did.
Since work covers health and life insurance, I’m only left with auto and renters insurance. These are semi-annual and annual, respectively. As you can see, I completely forgot to include them into my budget. And my renters insurance is due at the end of this month, so I had to improvise. As for auto insurance, I just took the total amount that I’ll be paying by the end of the year and divided it by 9 instead of 12, since I missed the first 3 months (again, oops).
In conclusion, I feel like I’m pretty well off when it comes to finances, especially since I started this so early in life. If you have any ideas on how I can improve this budget, please share. If you would like me to make you a blank templet that includes all the equations so all you have to change is the dates and the categories, please let me know. You can shoot me an email at email@example.com and I’ll be happy to make you one! I’ll even change the categories if you’d like.
Please share any of your own thoughts, observations, ideas, personal stories, etc. because I love reading them! Do you think this is a pretty solid budget or do you see some problems with it (if so, what problems do you see)? Does this budget seem overly complicated and hard to maintain or pretty simple and easy? What budget categories do you have and how do you keep up with your own budget?