I used to joke about the “B” word – budget. Other relatable b words – boring and blah. I thought I’d talk about how we budget in our household. A reason I disliked budgeting because when I tried it (when I was single) it made me think more about my money than I did without it – and not in that good way, in that over consuming way that drove me nuts. I figured as long as I was never in debt and had savings I was good.
But! I know budgets are smart and come with good intentions.
If you dislike budgeting or find it overwhelming, like I do, I’m going to share how we do it that makes it manageable for us.
Here’s how we budget –
- We know our actual yearly living expenses
- I watch less than 5 categories the entire year.
Here’s how we do it.
Every new year, we make our budget.
We have an excel sheet and we go through:
- Home/living expenses – mortgage, car insurance, average utilities, the typical living expenses
- Subscription/expenses – Blue Apron, Target/Amazon home orders
- My personal expenses – hair, facials, clothes
- Additional home expenses – landscaping, handyman work, repairs, furniture decor
- Cushion – maybe $5k just because things tend to go over.
This allows us to just make sure we are significantly below our income – the reality is, we know we can make our bills but we want to make sure we are significantly below and by significantly below, I mean half of what we bring in (ideally.) This doesn’t always work out this way, but it’s a goal.
Year to year we copy and paste and adjust if our insurance has gone down or subscriptions have gone up.
Here’s an example, I used easy numbers for a better visual – bolded are the categories I actually budget and watch. *Don’t over analyze numbers, this is not our actual budget, just making numbers easy.
What I actually monitor through the year
- Why we don’t monitor all “envelopes”: The living expenses, subscriptions, and some personal expenses such as hair cuts, groceries, gas, facials, utilities and car insurance – that’s like clockwork or things we don’t or can’t budget (I can’t limit my gas or food?). However if you are barely making ends meet, then yes, you should budget all envelopes if you feel as if you can control those other expenses.
We don’t care about extra pennies or dollars, we don’t monitor the expected expenses because we know their average cost and budgeted for it. The reality is, as long as we’re significantly under our income, the mandatory life necessities don’t need monitoring.
- We monitor: The expenses I can control and are also not necessary to overspend on for survival such as: gifts, clothing, makeup and a few home furniture upgrades, etc. This means I keep track of what I know can easily get out of hand. By only watching a few categories, it helps it not feel overwhelming. These are categories that I make daily conscious decisions about.
I use an app called GoodBudget and it does the “envelope budgeting” I also don’t keep track of income as Benjamin’s is somewhat predictable (as much as it can be in sales) and my income is used for miscellaneous spending, business things. You can also sync your app so your spouse can use the same budget.
We don’t do that because again, it’s really about my self control, but I like it! I tell it to fill the envelopes and every time I make a transaction I just add it to my phone and it’ll tell me how much I have left for the month or year in that envelope. I have found it to be the most efficient, less stressful way to watch my spending.
One more thing
As my husband would say, “The goal isn’t to spend it all.” Even if you have $100 left in your budget, don’t look for ways to just frivolously spend it.
I hope that helps some of you who dislike budgeting as much as I do, but you know you should ;)