The 'B' Word

Do you have one? (I am talking about a budget, not a female dog.)

Do you know what one is? (A PITA, yeah I know.) Seriously, a budget is nothing more than you telling your money where to go, rather than wondering where it went (sound familiar to anyone?).

It took us MONTHS to make one that actually worked. It was more difficult than it seems like it should be, mainly because we spent a lot of extra money on junk, and there really isn't a 'junk' category.....go figure.

What we use is called a Zero Based Budget. That simply means that you start at the top with your income, lay out all your monthly bills and when you subtract bills from income, the answer should be -0-.

Here is a simple example:

Income $3000

Payments:

Rent $750
Car Pmt $400
Ins $110
CC #1 $50
CC #2 $100
CC #3 $120
Student Loan $150
Fuel $300
Groceries $300
Utilities $350
Eating Out $50
Blow Money $50
Entertainment $50
Snowball $220

Total $3000


That is a zero based budget in a nutshell. With that plan, you have now accounted for every cent you will spend during the month. If one item in the budget goes over, then you will need to trim another item back to make up the difference.

A few notes about some of the items I listed and just some general budget 'stuff':

1. Blow Money - it is just what it sounds like - money you are going to blow. Let's be honest here, you are going to blow money on something during the month. Just admit that fact and put it in the budget. Now it's legit! :)

2. Groceries - OVER budget this one. No matter what you think you will spend on food, it is probably more. Same goes for Fuel. You can always trim back if you are able, but it is hard when you first start to find extra money.

3. Don't get discouraged. I would expect a minimum of 3 monthly budgets before things really start to fall into place. Unless you have already started tracking monthly expenses at some point in the past, your numbers will move around - A LOT. That is just the way it is at first.


What we found when we started doing this was that we made plenty of money, we were just blowing all of it. We don't have the coffee addiction that many people do, but we had a HUGE eating out addiction. It was taking any and all extra money we might have put towards bills.

Here are some actual categories and sub-categories we used on our monthly budget (yes, this was actually it back in January - we no longer have the car payments or most of the credit cards).

I am a geek, so I have this all laid out on an excel spreadsheet that does projected vs. actual, etc. but you can just do it on paper. :)

Housing

1st Mortgage
2nd Mortgage
Repairs or Main Fees

Utilities

Electricity
Water
Gas
Cingular
Dish

Food

Groceries
Restaurants

Transportation

Honda
Toyota
Gas and Oil
Repairs and Tires
Car Insurance

Clothing

Adults
Children

Personal

Life Insurance
SBC HOA
Gifts
Blow Money

Recreation

Entertainment

Debts

Universal Card
Drivers Edge
HSBC
Discover

So get your bills together, get a Big Chief Tablet and a #2 pencil, and get a budget going. You might be surprised at what you find!