Living Simply Series: Part 3: Make a Budget

So- ready to learn more about how WE budget? We are a family of 5 who live on one good paying, but middle of the road income. We could not do this without some serious planning. This is where our budget comes in. Mr. Incredible gets paid every Friday. That's my first tip. Plan your bill paying cycles out to match how YOUR money comes in. Planning to pay bills weekly if your money comes in twice a month will just make your head hurt. In my last post in this series I explained our budget categories. Here's what our budget sheet looks like.

• Down the left side I listed our budget categories.
  
• Across the top I have four columns labeled weeks 1-4. They also say the dates which apply to each week: 1(1st-8th) 2(9th-16th) 3(17th-24th) 4(25th-31st).
• I made a list of each bill, an average amount, with it's due date, and then listed the week BEFORE the due date as the week to pay that bill. (ex: a bill due on the 15th would get paid during week 1) This allows for mailing or processing time, and eliminates late fees.
• Then I marked the payment date in my weekly columns with an asterisk, so at a glance I could see what was due when.
• In a separate spot I listed things that come due only a few times a year (like our car insurance) I added these all up, divided by 52 and that is the amount each week we need to put into savings to be sure we have enough set aside for these things. (this amount goes in the savings column)
  
• Next I filled in the amounts. For large items like our mortgage- I divided by 4, and save that much from each check for our payment.
• When you're done, check the math (income - expenses) and be sure you're not shelling out more than is coming in on any given payday. Tweak it until it works. If you have to move a bill to a different payday, pay it earlier, not later.
• I keep this budget in a sheet protector at the back of my control journal, (more on this next time) along with an envelope for receipts. That way I always know where it is, and can grab it and go in an emergency.
  
• We have a standing date every Friday (payday) where we sit down with this budget and pay bills together. That way we know where our money is going. It's not hard but you do have to stick with it for it to work.

If you aren't a list & chart maker like me, you can get basic fill in the blank budget forms here:

Dave Ramsey's Quickie Budget
FlyLady's FACE System
Home Money Help