Budget Dork Alert!

[the2amigos]

OK, I'm not a stupid person, really. So why can't I figure out a budget that works for me?

I bought and have used Quicken for the about the last year and it isn't working for me. It doesn't link up with my bank so that's one problem, I have to manually input all the info.

I had tried paper and pencil, ack.

I think I either have too many categories, or not enough and then don't know where to put purchases into the budget. Like I do a big shop at Target, buy some food stuff, some cleaning stuff and maybe some car stuff.....how do I fit that into the budget?? I hate to take the time to figure all that out, but without it I get frustrated because I don't know where are money is going.

I just can't seem to get a handle on the budget process.

How much time to you spend a day/week on your budget? What process works the best for you - computer, pen/paper?

[sanguine_speed]

Here is what works for us.

We create an excel document. Each category (we get pretty detailed) is listed as a column, and each day of the month is a row. Each day we go through our daily spending and fill out the budget categories as they apply across each row. Each time we add a new expense, we retally up the column. We use pencil so we can erase the previous total. This tells us how much we've spent in each column at any given time. We also input the budget amount for each category for right underneath the running total so we can keep a constant eye on how we're doing compared with the budget for the month.

We also found that we had the same problem with dividing up receipts. Our friend gave us the tip to pay for the items separately at the store. No harm in it if you're using cash, or if you're using no-fee banking (debit) or if you use a credit card that you pay every month. So, if I'm at the grocery store and I buy food and household supplies, I place one of those dividers between them and ask to pay separately. I too found it too cumbersome to divide it all up, nevermind that here there are tax differences for different items and it was hard to figure out because all of the tax appeared as one tax total, so the actual amount we spent on each category was hard to tell (with a sales tax rate of 13% this could really skew our budget numbers over the course of a month).

[asianyoushi]

we also use excel . we just have all the bills listed. rent,car,credit cards,loan, water,electricity, cell, internet bundle. dh has it so u can just highlight it and it gives us a figure. after the figure is given we pay it and then the "left over money" goes for food,diapers and gas. if there is left over after those are bought it goes to the credit card with the lowest balance.

[EmsMom]

I use scrap paper to keep my budget on. I just grab a used piece of paper and use the back. Months along the side from top to bottom, categories along the top edge. But even if you use a computer I think the key is to keep a running tab somewhere else. I use another piece of paper kept on my refriperator. I write down everything that I spend on that piece of paper. If I spent, say, $100 at Target I might write groceries next to it and then minus an approximation of what I spent on a different category like clothes. So my entry would read $123. grocery. -- (minus sign) $7 clothes, -- $3.99 household (for hardware, say). I don't typically get out the calculator but just estimate (including tax if appropriate). Then that whole sheet gets totaled and entered into the budget spreadsheet at the end of the month. Thre spreadsheet is actually an ongoing report of whether I am over or under budget in one category. It really only takes a few minutes. I find that on the piece of paper I write each purchase down on it is helpful to make a brief note of what each thing was (shoes for dd, oil for car, etc.). That is because sometimes at the end of the month I can't believe what I spent but then there it is. Also, at the end of the month I double check my checkbook register and credit card statements just in case I missed anything. I rarely do now, but when I started I missed alot! I just file all the papers in a folder. Takes about two minutes on the days when I spend money (not that often!) and then maybe 15 minutes at the end of the month. At first I tallyed up my totals around the 25th of every month and at the end. That helped keep me on budget. The actual budget I figure out (now) at the beginning of the year or during the year when a significant change occurs (ie. a raise in salary or a jump in heating oil or gas expenses, etc.). Because I have been doing this for about three years, I have it pretty well honed down. At first I just went through all checkbook entries, all credit card bills, etc. and estimated what I was spending in each category. The first year I had a great big category I called something like "everything else"! But by the second year I had it worked out. The key is really in the tally sheet. Some people use a little notebook they can keep in their purse or pocket. Just write down what you just spent whenever you get back to the car or house. And don't forget to keep checking where you are in actual spending compared to what you have budgeted. If you go over, you either balance your budget with an amount from another budget or hold back the spending the next month. It has taken me a long time to get to this point where I set a goal for myself to ALWAYS be under budge AS MUCH AS POSSIBLE That way I have a bit of an "emergency fund" under each category. It really does take a while to get the hang of it, so don't give up on yourself!

[Purple*Lotus]

I use Larry Burkett's book of Budget Forms for my budget. I like it because it has tons of catagories, a lot of which we don't need because we have no kids at the moment, but pretty much everything I could think of it on it.

I would say that I spend about 3 hours a week working on my budget : I tend to be very obsessive about it.

For things like going to Walmart and getting household items, I usually only do that once every 3 months or so. So I budget in a certain amount monthly for "HouseHold Items". If I go over, it is not a crisis, it just comes out of grocery money.

It can take time to get your budget to right where it needs to be. Mine changes monthly. Some months I ban all eating out, other months maybe if it is a special occasion I will write it back in, etc. My budget is probably never exactly the same each month.

[xekomaya]

I'd say if your bank doesn't link up with quicken, its pretty useless -- Don't feel bad that its not working for you.

I do really love graph paper for budgets if you use a lot of cash. Entering all those numbers into something digital can be so tedious. Sanguine_Speed described a really good method -- especially keeping your budget goal number below the column so you can keep an eye on it. I do always keep 2 columns in each category though, the first to note the store or specific expense and the second for the value of it.

One thing you mentioned about having too many or too few categories -- Think of categories as helping you - nothing else. I change my categories all the time based on what I need to keep an eye on. I do technically have a "Pets" category and its nice to know what I spend there, but my cat eats the same food, uses the same litter, and only goes to the vet if its an emergency so I consider her expenses pretty fixed. The only information I need from that category is how much I'm spending annually so I can plan and save accordingly. OTOH, I have a Misc. category I watch closely - if things don't fit into a regular category of the budget we put it there, but if the same kinds of things are popping up month after month I can decide where they should go or if I need to watch a certain type of spending more carefully.

One more thing, I like to keep a yearly budget more than a monthly budget. Many things we don't spend in every month, but we will need to buy at some point in the year. Clothing being the best example, I probably only shop 3-4x a year for us, but I know I'll need a certain amount of money for that. When I tally up take home pay - fixed expenses over the year, I can see where I stand overall and how much I should be setting aside for important expenses that don't happen so regularly.

[aratiaw]

I do always keep 2 columns in each category though, the first to note the store or specific expense and the second for the value of it.

So do you add a row for each item, or just total what you spent that day for that category?