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How do you budget?

August 9th, 2008 at 11:22 pm

After many unsuccessful attempts at trying to find a budget format (Quicken and Excel) that worked for me, I've resorted to just using Quicken's budget. I don't like it really but at least I don't have to make double entries. I enter things once and I can see where and how my money was spent.

I have many budget categories. I like detail and figure if I am going to have a budget I may as well see exactly where my money is going. But where do you put things like home maintenance? Would that be a HOME expense with my mortgage and property taxes or just a regular HOUSEHOLD expense? Trivial I know, but not knowing how to classify certain expenses has in part been why I haven't been successful with budgets in the past.

Another thing I am doing that probably isn't the proper way to budget is I only budget for necessary expenses. What's left is in a pot for non-necessities. I am careful to not splurge on things simply because there is "money in the pot"; I enjoy finding bargins and don't overspend on things I know I can get cheaper.

Zero-based budgeting never worked for me simply because there was always something that I hadn't anticipated that would mess things up. So for now I am going to use my "money in the pot" method and see how it works.

I'd love to hear how you are budgeting.

6 Responses to “How do you budget?”

  1. Petunia Says:

    Umm. . . we're not budgeting?? I think we are in similar budget spots. DH and I had a loose spending plan for many years while we both worked. When I stopped working at paid employment we continued with a loose spending plan. . . now it's caught up with us. I have categorized home maintenance under household. . . although I suppose some of these things (like painting the exterior of the house, or insulating) might be better categorized as home.

    DH and I are working towards a budget but it's a slow process.

  2. greengirl Says:

    well i classify home expenses under Home/Electrical/Appliances. I pay rent so it goes under the Rent category. I too like detail in my budget. When we have a mortgage it will be classified as 'mortgage'. I have a loose amount of around $50 which is meant to be for everything else other than Bills, Petrol, Groceries, Skincare, Rent, Savings etc but I usually go over the $50 by two :O as long as I have saved my budgeted amount (about $100 a week) and paid everything else, and am UNDER the amount that I earn I am quite happy. I'm 21, and I like to do 'stuff' so I don't want to be too tied down with worrying about spending $50 more on some clothing and the movies. If I do go over one month, you can be sure I buckle down the next month and spend under the budgetted $50 every week. Smile

  3. sillyoleme Says:

    I don't really use budget software. I tried Excel, but I could never manage to get in the detail that I wanted, with the functionality, and have it remain simple to understand/use.

    So for now, I sit down at the beginning of the month (or the end of the prior month) and determine what amounts I foresee having to spend in each category. "Rent" is one category, "Household" covers cleaning supplies, decorations, stamps, etc. I have separate categories for each utility.

    I estimate the amount of income I think will be coming in, and then allocate everything that I know MUST be paid (bills, rent, debt payments). Then I go down the ladder of "must have" expenses, getting the amounts for gas/maintenance, then pet stuff, then groceries, then entertainment, etc.

    This month, I budgetd $50 for savings, then allocated the rest to either debt payments or spending categories. That way, I have a built in buffer if we happen to have an unexpected expense.

    I have been *trying* to track all my spending, but the most efficient way I've found to do it is to just list it at the top of my blog entries. It's convenient because I check the site everyday anyway, it's simple & easy to jot it down while it's fresh in my mind, and it makes it very nice at the end of the month to skim over the tops of my entries and get the totals.

    Good luck figuring out what works for you!

  4. little l Says:

    Petunia,
    I was like that for a while because I couldn't figure out a system that worked the way I wanted. I also didn't like budgeting for every non-essential category because there was always a fork in the road that would mess things up. For the time being, budgeting only the necesseties is what I plan to do. I enter our spending into Quicken all the time so I am aware of how much cash is left until next payday. Good luck with your budgeting.

    Greengirl,
    Yes, as long as the bottom line at the end of the month is not negative and you have paid the necessities and saved some money, you are good.

    Sillyoleme,
    Sounds like you and I are doing the same in terms of budgeting for what has to be paid. Whatever works, right?

  5. helpmefriend Says:

    Try giving up the fancy computer and programs and get a pencil and paper. One page for every different category and a calculator.
    Give that a try!

  6. little l Says:

    Computer is easier... I have a lot of categories.

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