Our Emergency Fund Saves the Day!

If you follow me on Twitter, you may have read that, yesterday, my car broke down.  I’m taking it to the shop today, but I’m not sure yet how much it will cost to repair.  It is less than a month until Christmas and suddenly, we have this unexpected expense!

I can’t say that I didn’t feel any worry.  I did (I needed to get to work!).  But, not because we didn’t have the money.  We do!  Thanks to Dave Ramsey and his Total Money Makeover baby steps, we have an emergency fund!

A New Goal

This week I worked on Monday, Tuesday, and Thursday evenings and I will work again tonight.  Wednesday wasn't much less busy with trick-or-treating.  Needless to say, I'm worn out!  Working (even part-time) while homeschooling and running a home is hard.  So often, I feel like something just has to give!

I've done a lot of wishing and hoping and praying over the last few year that I might be able to once again be a stay-at-home mom, able to concentrate on my home and my family.  I admit that, most of the time, it feels pretty hopeless.  After all, we have debt that needs be paid off and that is a three-year goal.  My kids will be 10 years old by then!

Finally, after lots of prayer, I think God may have given me a solution.  No, He didn't drop a bunch of money in our laps and, no, this isn't something that will allow me to quit my job tomorrow.  But, I think He has shown a way for me to actively work toward this goal of being a stay-at-home mom.

I'm So Excited, I Just Had to Share!

This isn't directly related to my Financial Life or Mental Life categories (although, it is indirectly related).  But, I just couldn't wait to share my exciting news!

I'm getting a NEW KITCHEN!

Well, kinda. ;)  You see, the other day my mom asked me if I would like for her and my dad to buy me new flooring for my kitchen (my dad would install it) and to paint my cabinets as my Christmas present.  Of course, I said "YES!" 

The more we talked, the more the plans grew.  Some of it is stuff that my hubby and I will pay for and my dad and I will build.  Some of it is simply moving things around.  Some of it is using materials we already have on hand.

In the end, I am going to end up with what looks like a completely re-done kitchen for very little money and lots of sweat equity!  I am so excited!  I have done very little to this house since we moved in 7 years ago.  I was pregnant with the twins when we bought the house and I was put on bed-rest just two days after moving in.  Then, after they were born, I was busy learning to be a mommy.  By the time I really had time to do any work, we were struggling with debt.  Now that we are doing so much better with our money management, we are able to find a little bit of room in the budget for small, frugal projects.

Paydays = Busy Days

One of the few downsides to budgeting is that you have to make the time to do it right!  This includes making the time to organize all your "envelopes" (both real envelopes and digital ones) on payday.  Today is such a day. 

My husband gets paid every other week and a commission check at the end of the month and I get paid every other week.  This month was one of those rare three-paycheck months.  So, we not only both got paid our paychecks today, but we also receive my husband commission since it is the last day of the month.  This means that their is even more information to organize!

I've spent the last couple of hours updating our budget and putting money in the correct categories in our budget software.  I've also paid all our bills that needed to come out of this check and our commission. 

Thankfully, I had everything planned out beforehand and I didn't just need to guess where the money needed to go.  I'm also really glad that we have a plan going forward.  I know for a fact that I will have enough money for our kids' birthday party next Sunday and that I won't have to worry about having enough money for food.  This makes it so much easier to spend a few hours of concentrated effort on our budget on payday and then just a few minutes downloading our activity and updating our budget software every other day.

So, despite all the time that it can take to do things right, it is very worth it in the end!

Menu Plan Monday: The Verdict, So Far

For the past month, I have been working on lowering my grocery bill using the advice of Kate Megill from Teaching What is Good and her new e-book, Cut it Out!  How I Feed my Family of 10 for $500 a Month Without Coupons.  I've learned a lot and I've done a lot of work on planning my rotating menus and setting up a price book.  But, I still have a long way to go.

My "pantry" shelves in my garage.

My kitchen "pantry" selves.

My grocery bill this past month wasn't really down from the month before.  However, I have to stress that I did a TON of stocking up this month!  My "pantry", my fridge, and my chest freezer are all full.  You can see in the picture to the left that I am well stocked with all kinds of non-perishable items.  I have enough cans of veggies to last several months.  This is my "pantry" shelf in my garage. 


I also have two other similar shelves in my kitchen that serve as the rest of my "pantry" (pictured on the right)  These are equally full, but almost too messy to photograph!  I straighten them up every few months, but they always end up looking like this again.  They take up one whole wall in my tiny kitchen.  Since we only have two cabinets, this is where most of our food is kept.

Here is the rest of my food shelves.  This is the only cabinet space where I can keep food because I need a place for dishes.

And, finally, my fridge.  It is in a corner, so I can't open the door any wider than that for a better picture.  But, you can see that it is completely full.   The freezer side and my chest freezer in the garage are equally full.

So, what's so great about all these full shelves and a stocked fridge?  Well, first of all, all these shelves were practically bare just at the beginning of the month.  Secondly, it has been a complete week since my last grocery trip and I still have lots of food left.  That means that almost all this food was purchased for the same amount of money that we normally spend every month on just enough to get by.  It also means that we have plenty of food to get us through, not only this next week, but a long time to come.

I can't wait to see how much my grocery bill decreases next month!  Speaking of all this food, here is what I have planned for this week:

Monday - Sausage & Perogies, Peas (I work, but DH can make this)
Tuesday - Stuffed Shells, Salad, Garlic Bread (I have to work, so I need to make these ahead)
Wednesday - Chicken & Dumplings
Thursday - Breakfast: Bacon, French Toast, Scrambled Eggs
Friday - Baked Rigatoni (I work again, so this is another make-ahead meal)
Saturday -  Chicken Fried Chicken, Mashed Potatoes, Green Beans
Sunday - Grilled Chicken, Fried Rice, Veggies


I'm linking up over at I'm an Organizing Junkie for Menu Plan Monday. 

I Love Aldi!

In my quest to lower my grocery bills, I visited Aldi today.  Aldi is a discount grocery chain.  If you don't have an Aldi near you, I would like to express my deepest sympathy.  If you do and you've never been, I highly recommend you schedule an afternoon to go visit!  No, I'm not getting paid to say any of this (who would pay a blogger that hardly anyone reads?).  I just really love Aldi!

I try to make a trip to our nearest Aldi every couple of months at least.  I stock up on canned goods and boxed items.  I also get some snacks and cereal.  I save a ton of money when I do that.  But, today I actually bought some produce and some bread.  Everything I bought was cheaper than at Kroger's.  I know this thanks to my handy price book that I've been working on.  As a part of my effort to save money, I'm going to start going to Aldi more often.  At least every month.  Hopefully every two weeks.  It is a longer drive and time isn't always available.

If you do decide to visit your Aldi, there are a few things you will need to know.

1) Take a quarter.  Yep, a quarter.  One of the ways Aldi keeps their prices so low is they are a bit protective of their carts.  You will need a quarter to get one.  Unless a very nice person who just finished shopping offers you theirs for free.  This happens to me pretty often.  I believe it has something to do with feeling so great about all the money you've saved causing you to want to give to others.  Of course, I always pass along my free cart when I am done.  If you aren't a link in the "pay-it-forward" cart blessing, don't worry.  You'll get your quarter back when you return your cart.  This saves them from having to pay someone to gather up all the carts from the lot. 

A really bad pic of sis helping bag groceries

2) Speaking of carts, the people who generally wrangle the carts at your average grocery store are the baggers.  Aldi doesn't have baggers.  Once again this saves them money and they pass the savings along to you.  After the cashier rings your items up, they get put straight into another cart.  Then, after you pay, you take your cart over to the long counter they have available and bag your own groceries.  I actually like this because things never get bagged the way I want at Kroger.  Some bags will be practically empty while others are almost impossible for me to lift and I always end up with cleaning supplies in with my raw meat if I'm not careful to watch the bagger.

3) Along with bagging your own groceries, you will also need to bring your own bags.  Once again, this is a money saver for you.  All those bags cost a pretty penny!  They do have bags you can buy if you need to, though.   They have paper bags and canvas ones.  I have a slew of canvas bags that I use when I go to Kroger, too.  They are easier for me to carry since I can sling them on my shoulder, and they don't tear from box corners.  They cost me about $1 each, but they have lasted me several years.

4)  They don't accept credit cards.  I know this is a hard one for some people.  But, every time a store accepts a credit card, they are charged a fee.  That fee is then passed on to the customers through higher prices.  Aldi's goal is to keep things as affordable as possible while still offering quality.  So, you can use a debit card, EBT card, or cash.

5) Aldi's isn't very pretty.  No, it isn't dirty.  I'd never send you to a dirty grocery store!  But, the one by me is pretty outdated, the shelves are piled high with groceries and there aren't any flashy displays.  This saves money on floor space and costly store makeovers.

6) You won't find many name-brands.  Other than a handful of weekly specials, Aldi only carries their brand.  So, you will be buying generics.  But, I promise, I have never been unhappy with anything I bought at Aldi!  In fact, many of the things we buy there we prefer over Kroger's brand or even the name-brand.  Plus, Aldi has a double satisfaction guarantee.  If you aren't happy with an item, they will replace the item and refund your money.  Seems to me it is worth a try!

Now that you know what to expect, let me show you why I love Aldi so much:

Cart full of groceries at Aldi

Bub (who refused to be in the picture) holding up our Aldi receipt

See that cart filled to overflowing with groceries?  That whole cart cost me $150. Here is what I got for my money:

• 2 boxes of ice cream treats
• 3 loaves of white bread
• 5 boxes of Jambalaya mix (we love Jambalaya, but I just don't have time to make it from scratch!)
• 1 bag of jumbo marshmallows
• 1 bag of baby carrots (the kids eat these like candy!)
• 3 tubes of Crest toothpaste
• 3 cans of tuna
• 1 pack of American cheese slices (we aren't picky about our cheese on grilled cheese)
• 2 boxes of stuffing mix
• 2 lbs of bacon
• 1 pack of English muffins
• 2 packs of hot dog buns
• 24 cans of green beans
• 12 cans of peas
• 12 cans of mixed veggies
• 12 boxes of shells & cheese
• 1 multi-pack of Ramen noodles
• 2 packs of fruit cups
• 4 boxes of hamburger skillet meals (aka. generic Hamburger Helper)
• 3 jars of spaghetti sauce
• 2 jars of alfredo sauce
• 2 rolls of paper towels
• 1 jar of garlic powder
• 1 bottle of olive oil
• 12 boxes of breakfast fiber bars
• 1 box of brownie mix
• 2 boxes of cereal
• 1 jar of cinnamon
• 1 head of lettuce
• 1 bag of dishwashing tablets
• 3 bunches of broccoli
• 4 cans of pasta (ravioli and spaghetti o's)
• 1 tub of cat litter
• 6 cans of cream of chicken

You can see from my list that a lot of these things are convenience foods.  I mentioned that I am slowly trying to cut these out and make more from scratch.  Convenience foods are generally more expensive.   But, their staples, produce, dairy, and meat prices are also really great!  A cart full of groceries at Kroger generally costs me about $250.

Now, I know that someone out there must be wondering why I would buy 24 cans of green beans.  Well, like I said, I'm used to only going every couple of months.  I would go and stock up on non-perishables like canned and boxed goods.  They would last a long time and I wouldn't have to risk buying them at a higher price when I couldn't make it to Aldi for a while.  I keep it on shelves in my garage and won't have to buy more for a few months at least. 

I wanted to go ahead and stock up now while I am still working on my price book and menu plans.  Sort of a back up just in case.  But, I definitely plan to visit Aldi more often so I can also buy perishable items there.

If you visit your local Aldi, I'd love to hear about it!

I'm a Nerd

Alright.  I admit it.  I'm a nerd.  This is true for many reasons.  But, today I'm talking about my love of spreadsheets.  That's right, spreadsheets.

I often find myself creating elaborate, detailed spreadsheets for even the simplest of things.  Part of it might be my deep dislike for math.  Why figure it out myself when I can create a spreadsheet that will do it for me?  That makes sense, right?  Right?  Please tell me I'm not crazy!

I realized as I wrote about my budgeting process Tuesday that I made the whole thing seem pretty straightforward and simple.  And, it could be just that!  But, for some reason, I feel the need to both complicate and simplify this process with a spreadsheet.

It simplifies it by having a template already to go instead of having to create a budget completely from scratch every month.  It also does all the math for me (Did I mention I'm not a fan of math?) and all I have to do is enter the amounts and watch the difference between our income and our "outgo" slowly reach zero for our zero-based budget.

But, it complicates it because I actually had to create the spreadsheet in the first place.  And this isn't some add-the-column-for-the-total spreadsheet.  It is complicated.  It even has calculations that require using several different sheets.  Three different sheet to be exact.  "Monthly," "Daily," and "Irregular Income."

First, there is my Monthy Cash Flow Planner:

This is where I do the over-all monthly planning.  Here is where I figure out our income vs. outflow for the month.

On the right, you see places for both our regular, predictable income and our "extra," unpredictable income.  When I enter amounts in here, it automatically updates the summary at the top.  Then, as I enter expenses on the left, the field that says "AMOUNT REMAINING" in the summary will decrease until it eventually reaches zero.  When it does that, my monthly cash flow plan is complete. If you could scroll down the sheet, you would see that the columns on the left keep going for all of our possible expenses. 

Once that is complete, I have to figure out exactly how much money from each check is going toward each of our expenses.  Because bills are due at different times, different amounts need to come out of each check.  This is where my "Daily" sheet comes in (It is closer to weekly, but not exactly and that bothered me enough to label it "Daily" instead.  I told you I was a nerd):

The rows at the top that list the amount of money available from each check import automatically from my "Monthly" sheet.  Then, as I enter amounts for each expense, there is a row at the bottom that will show how much I have left until I eventually reach zero.   The amounts that I listed for expenses on the "Monthly" sheet also transfer over.  For example, let's say I entered $100 in the tithing category on the "Monthly" sheet.  Because I have not yet entered any money on the "Daily" sheet, the "Difference" column would show $100 and be orange to give me a warning that I still need to figure out which check that money is coming from.  If I enter $50 for tithing under the "Commission" column, the "Total" would then be $50 and the "Difference" would also be $50.  The "Difference" would still be orange because I still have $50 to enter to under a pay-period.  If I were to put too much money in the tithing category, the "Difference" cell would turn red to warn me that I went over budget.

This sheet is complicated, but the process is simple.  I enter the amounts and the sheet lets me know how much I still have to allocate to a pay-period.  It also warns me if I haven't allocated enough or if I've gone over-budget.

Finally, I have my "Irregular Income" sheet.  I explained the basics of how to budget for an irregular income yesterday.  Here is where I actually do it.

Once again, the amounts that I entered in the "Extra" unpredictable income area of my "Monthly" sheet automatically transfer over to this sheet.  Here, I can take that amount and plan where it will go.  The "Amount Remaining to be Distributed" column tells me how much money I have to use in my planning.  As I enter amounts into the columns, this will eventually reach zero.  I'm currently working on making this update automatically as "extra" money becomes available.  But, that is going to take some time to figure out the correct formulas.  I'm not sure why I find that fun when I hate math.  Go figure.

So, there you have it.  My simple, complicated system for planning my budget!  I promise you, though, it can also be done with paper, pencil, and a calculator.  I'm just a nerd.

Budget Planning With an Irregular Income

I promised to come back at talk more about my budgeting process when I explained a zero-based budget a couple of weeks ago.  So, here it goes!  I'll start with how I plan our budget.  I'll post something in the next week or so about how I maintain our budget.

Our income each month is irregular.  My husband works in retail, so he gets a base salary, plus a monthly commission.  We never know exactly how much that commission is going to be.  My income is also ever-changing because I work part-time and my hours are never the same. 

If your income is unpredictable, you can still plan a budget!

But, we do know that there is an amount that both my husband's commission and my income* have never gone below.  This is our minimum and, combined with my husband's predictable base-salary, this is where we start our budget. 

I shared the chart below on the last post about budgeting.  This would be an example of a predictable-income budget.   

Total Income:                 $3000.00

Total Planned Budget:     - $3000.00

                               ___________

                                    $0

Budgeted Item	Amount Planned	Amount Actually Spent	Running Total
Giving	$100.00	$100.00	$100.00
Emergency Fund	$50.00	$50.00	$150.00
Mortgage	$700.00	$700.00	$850.00
Real Estate Taxes	$200.00	$200.00	$1,050.00
Homeowner’s Insurance	$100.00	$100.00	$1,150.00
Home Repairs			$1,150.00
Electricity	$200.00	$200.00	$1,350.00
Water	$30.00	$30.00	$1,380.00
Gas			$1,380.00
Phone	$20.00	$20.00	$1,400.00
Cable	$50.00	$50.00	$1,450.00
Internet	$50.00	$50.00	$1,500.00
Food	$600.00	$547.23	$2,100.00
Car Payment	$300.00	$300.00	$2,400.00
Gasoline & Oil	$200.00	$197.49	$2,600.00
Car Repairs			$2,600.00
Car Insurance	$150.00	$150.00	$2,750.00
Debt Snowball	$250.00	$250.00	$3,000.00
Total			$3000.00

If our predictable income for the month (base salary, plus minimum commission, plus my minimum income*) were $3000, our budget might look like this.  If your income is predictable, you could stop here with your budget planning.  You would know exactly how much money you were going to have coming in and you could plan exactly how much money went back out!

But, if your income isn't completely predictable, you need to take one more step.  The irregular-income budget.

Notice, that the budget above is a pretty bare-bones budget.  There is no money being saved for possible car repairs or home repairs.  There is no money for clothing (there would be if there were an immediate need), or entertainment.  And, I definitely want to put more toward our debt snowball!

I know that we will likely have more money coming in each month from my husband's commission and my income*.  So, after I plan a predictable-income budget, I then need to figure out how we are going to use that "extra" income.  This is where our irregular-income budget comes in!

To make an irregular-income budget, I first have to make sure the basics are taken care of with the money I know will be coming in.  We have to have money for food, for our lights and water, for our car payment, insurance, and at least enough gas to get to and from work, our mortgage and insurance, and other important payments.  It is really about setting priorities.  Dave Ramsey calls this the "four walls."  You have to make sure your walls are up before you can put the roof on!

Next, make a list of everything else you would need or want money for this month.  This list might include things that you know you will eventually need money for even if you don't need it right now (like clothes) or a little bit of money for things you don't need, but would like (Like entertainment.  When you are in this for the long-haul you still need to have a little bit of fun.  Just keep it reasonable!).  But, if you are on baby-steps 1 or 2, make sure to make your emergency fund and/or debt snowball your top priorities for any "extra" income!

Once you have a list of expenses to include, you will need to figure out which are your priories.  List them from most important to least important and assign them dollar amounts.  You should also make the list longer than you think your income could possibly be.  It might look like this:

Budget Item	Amount Planned	Running Total
Debt Snowball	$100.00	$100.00
Clothes	$100.00	$200.00
Car Repairs	$50.00	$250.00
Entertainment	$50.00	$300.00
Debt Snowball	$200.00	$500.00
School supplies	$50.00	$550.00
Gifts	$50.00	$600.00
Debt Snowball	$400.00	$1,000.00
Total		$1,000.00

 Now, if we were to make an extra $1000 this month, we would know exactly where every penny was going!

Notice that "Debt Snowball" is on the list more than once.  I often split up our debt-snowball money into smaller chunks.  This way, I know that some money will be going toward it no matter how much extra we make.  But, if I were to put the entire $700 together into one lump-sum, we might not make enough extra to go toward anything else.  I definitely want to have some money put aside for clothes the next time my kids hit a growth spurt!  So, I split it up unto smaller amounts so that I can really prioritize things.

Now, as "extra" money comes it, I simply go down the list.  If we were to make $500 more this month, I would put:

1. $100 toward our debt snowball
2. $100 toward clothes
3. $50 toward car repairs
4. $50 toward gas, and 
5. Come back to put $200 more toward our snowball. 

If I made $501, that one extra dollar would go toward school supplies.  Anything that we don't get to this month might make it back on the list next month.  

So, there you have it, an irregular-income budget! 

Is your income unpredictable?  How do you plan for your "extra" money each month?

*Note: I've recently started counting all of my income from my part-time job as part of our irregular-income budget rather than our predictable-income budget.  There are two reasons for this: 1) We eventually want me to be able to be a stay-at-home mom again and not have an income.  So, we are trying to adjust our budget so that we aren't counting on that money each month for our basic expenses.  2) By putting my income into our irregular income budget, we find that we seem to have more money for "extra" expenses like clothes and our debt snowball.  It somehow tricks our mind when planning the budget because it looks like we have less money to work with than we actually do.

My First Menu Plan Monday Link-Up!

Today, I am linking up to Menu Plan Monday over at I'm an Organizing Junkie for the first time!  I'm really excited to do this.  This will be my first link up and I must have read the instructions about a million times to make sure I get it right!  But, I'm going to brave it and give it a try.

Menu planning has been a part of my routine for several years now.  I absolutely hate going to the grocery store, so it helps cut down on extra trips.  It also saves me from trying to come up with an idea for dinner at the last minute, only to not have everything I need on hand.  I've learned that lesson the hard way!

But, my system wasn't as good as it could be.  One big red flag was how much we spend on groceries every month.  This is the part of our budget that I have the hardest time with.  I often find myself either going over-budget or with nothing left to eat at the end of the month.  Enter Kate Megill from Teaching What is Good and her new e-book, Cut it Out!  How I Feed my Family of 10 for $500 a Month Without Coupons. 

Wow!  I read the book in about 45 minutes last week and I learned so much!  I'm working on putting it all into practice over the next month or so.  I'll be writing more about that in the weeks to come, I'm sure!  Since I only have 4 people in my family, this makes me really see that we pay way too much for groceries!

I was able to take the first few steps this week and have a fresh menu plan for the next two weeks and a shopping list.  Tomorrow I am headed to the grocery store to work on my price list.  Since the kids are still on vacations, it is the perfect time for an extra long shopping trip. 

Here's this week's menu:

Monday - Crockpot chicken, mashed potatoes, green beans, rolls
Tuesday - Tacos, refried beans
Wednesday - Chicken casserole (made with leftover chicken from Monday), bread
Thursday - Smoked sausage, shells & cheese, mashed potatoes, bread
Friday - Spaghetti & meatballs, salad, garlic bread
Saturday - Chicken noodle soup (Made with the last of the chicken from Monday, plus an extra chicken breast, and broth made from the carcass of Monday's bird), bread
Sunday - Breakfast: Sausage links, scrambled eggs, fried potatoes, toast

I am working on Tuesday, Thursday, and Friday this week (yuck!) and I have church on Wednesday night.  So, I need to have meals that will be easy and quick for my hubby to make when he gets home from work.  Some of the menu items can be made ahead of time to make it as easy as possible.  Some of the things on my menu I could make from scratch.  But, since I am working I also need to be careful of my time. 

Because of this, I'm not cutting out all my convenience food right away.  I'm going to slowly build up to it and do more freezer cooking on the weekends.  For example, I might use a few extra chicken breast and make two chicken casseroles this week.  One to eat and one to freeze.  Until I get to the point where I have plenty of pre-made home-cooked food, I'm not going to feel guilty about not making as much from scratch.  I have to work toward balance between money and time.

Zero-Based Budget

I'm going to try and finish the post I had started yesterday.  It was nice to have it half done already! 

I talked a little other day about the how we are working Dave Ramsey's program to get out of debt.  I thought I'd come back and post a little about my actual budgeting process.  Our system is based on a zero-based budget.  Meaning that, every month, we spend our money on paper before it even shows up in our account.  This way, we can tell our money where to go instead of wondering where it went!

Today, I'll explain exactly what a zero-based budget is and I'll come back another day to explain how I plan my budget every month.  This was a hard process for me to learn!  I tend to be more of a free-spirit naturally and have had to force myself to be more disciplined and tell myself "no." It took several months of working on it to get it figured out.  So, if you try it, don't get discouraged if it is a disaster the first month!  I learned a lot from my failures.

What is a Zero-Based Budget?

A zero-based budget is one where your income minus your expenses equals zero.  This doesn't mean that you literally spend every cent you make.  Only that you assign every cent a job.  Some money won't be spent right away.  But, it will be assigned to a budget item.  By setting up a budget, you will aim to have money "left over" at the end of the month.  But, you will also know what you are going to do with that money.  Will it go in savings?  Will it go toward debt?  Will it be put aside and added to the next month for a larger purchase?

The concept comes from the "old fashioned" practice of envelope budget.  This is when you kept all your cash in envelopes designated for different things.  We actually use an actual envelope budget now.  But, I'll go into that more in a later post.

How to Create a Zero-Based Budget

To create a zero-based budget, you need to start with your expected income.  Write it down.  If you have an irregular income (like we do) it will take another step.  For now, just figure out the minimum amount that you know you will make this coming month.

Next, make a list of expenses that you expect to have during them month.  Include regular bills like mortgage, utilities, and debt payment.  Also include the things that vary month to month, like food, clothing, etc.  If you are saving up for a purchase, include that, too.  Also, make sure to include any giving you do and money being put into savings.  These budgeting items are the heart of your budget. 

Once you have your list of expenses, you will start to subtract the amounts from your income.  If, when you are done, you have money left over, this is where you get to decided what to do with it.  Assign the money a job until there is nothing left over.  Here is an example of what that might look like. 

Total Income:                 $3000.00

Total Planned Budget:     - $3000.00

                               ___________

                                    $0

Budgeted Item	Amount Planned	Amount Actually Spent	Running Total
Giving	$100.00	$100.00	$100.00
Emergency Fund	$50.00	$50.00	$150.00
Mortgage	$700.00	$700.00	$850.00
Real Estate Taxes	$200.00	$200.00	$1,050.00
Homeowner’s Insurance	$100.00	$100.00	$1,150.00
Home Repairs			$1,150.00
Electricity	$200.00	$200.00	$1,350.00
Water	$30.00	$30.00	$1,380.00
Gas			$1,380.00
Phone	$20.00	$20.00	$1,400.00
Cable	$50.00	$50.00	$1,450.00
Internet	$50.00	$50.00	$1,500.00
Food	$600.00	$547.23	$2,100.00
Car Payment	$300.00	$300.00	$2,400.00
Gasoline & Oil	$200.00	$197.49	$2,600.00
Car Repairs			$2,600.00
Car Insurance	$150.00	$150.00	$2,750.00
Debt Snowball	$250.00	$250.00	$3,000.00
Total			$3000.00

Notice that with some of the budget items, the amount spent is exactly the amount planned.  These are generally the things that you know, in advance, exactly how much money will be needed.  Often, this is because it is the same amount every month, like your mortgage.  But, with other items, the amount spent is less that what was planned.  This is great!  The difference will carry over to the next month.  Some budget items won't have money assigned to them every month (like "Home Repairs" and "Car Repairs" in the example above).

How do I Know How Much To Budget for Something?

The best way is to look back at the last few months.  Get your statement out of your files (if you are actually organized enough to do something like file!) or print one off from your bank's website (this is what I had to do!).  Then, sit down and figure our exactly how much you have spent each month on different things.  For example, look at the statement from last month and write down every time you ate out and how much you spent.  Then, take a look at the total.  You might be shocked at how much you spent!

Put every item on your statement into a category.  Some may just need to go into a miscellaneous category because they really don't fit in anywhere else.  But, try to do that as little as possible.

If you use the last couple of months to determine an average for each of your budget categories, you will have a starting point for planning next month.  You may decided that you want to cut back in an area, like eating out.  If so, plan a little less than you normally spent.  Just remember, this means you will actually have to cook at home more often!  So, be prepared and have a plan!

There are also a lot of great software and online programs you can get to help you do this.  I personally use You Need a Budget (YNAB).  I was able to create categories (it suggests several common categories to get you started), download my bank statements, assign each expense to a category, and view exactly what we had spent each month.  I highly recommend their program and have used it for several years.