Budgeting for Beginners

If you get to the end of the month and wonder where all your money went, it may be time for a budget!

A budget helps you compare how much money is coming into your household in a month to how much is going out each month, and to have full awareness of the difference. A budget can help you live within your means, and even work toward longer term financial goals.

Here’s a handy budget worksheet: You can use it as you follow the steps shown below.


First, figure out how much money is coming in each month. Write down your monthly income from your paychecks, as well as other things you may receive regularly, like freelance income and child support payments. Total these up so you know how much you have to spend each month.


Next, figure out how much money is going out each month. Add up monthly expenses like rent or mortgage payments, utility bills, phone and internet, childcare, loan and credit card payments, transportation costs and any other recurring bills. 

Next, add up discretionary expenses.  These are for things like entertainment, take-out, and hobbies.  Examples of these might include video streaming services, skiing, or a weekly pizza night.  Looking back through credit card or bank statements might help jog your memory.

What’s left?

Now that you know how much money is coming in and going out each month, subtract your expenses from your income. What’s left? Hopefully, you have a positive number.

If you have a negative number, you need to find a way to trim expenses somewhere. If you have a positive number, you may be able to save money toward an Emergency Fund or other longer-term goals.

Get in the Habit

It’s a good idea to develop a budget habit. Start each month with a written budget and follow it. This helps to control all those little unplanned expenditures so you’re sure to have extra at the end of the month. There are plenty of ways to track your budget, from award-winning apps to an old-fashioned notepad.  It doesn’t matter how you do it but keeping an eye on what you spend will allow you to make room for positive change in your financial life.  Enjoy the freedom and peace of mind that comes with building a strong financial foundation and future!

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