Budget Planning 101 - stage 1

  • Establish your current spending


    This is the first stage of our 5 step series to begin your budget process. Stage 1 is to establish your current spending.

    If you already have a spreadsheet program this is your best choice, as it allows for easy calculations. All you really need is a pen and some paper at the very least to get you started on identifying and tracking these fees.

    Organization is a large part of this budgeting process, so I recommend you consolidate how you handle your bills and expense tracking. By this I mean, you either have online banking and account management for your accounts, or you collect your monthly paper bills and organize them manually. I am a fan of the online method, but please choose whichever you are comfortable with and organize accordingly.
    So now to begin. Once you have a month or two worth of bills, begin to track actual spending categories, such as


  • utilities

  • gasoline

  • car repair/maintenance

  • entertainment

  • groceries

  • dining out

  • pet expenses

  • other household



  • These will be whatever categories make sense for your life. Then let's add these pesky little categories that may not come to mind at first, such as


  • late fees

  • finance charges

  • atm / checking fees

  • annual or regular membership fees



  • Once you see the expenses in these categories start to add up, this will provide some great motivation to keep your budgeting process moving along. It is a good idea to track all of your expenses going forward in this manner, but to provide a good snapshot of your spending habits, you should have at least 2-3 months worth of this data.

    In stage 2 of Budget Planning 101 we will access our new baseline and work toward eliminating excess expenses.

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