Define your financial world so you can build an effective budget.
At Consolidated Credit, we believe the right tools can save you time and hassle when it comes to managing your money. Budgeting is fundamental to overcoming and avoiding problems with debt while making it easier to save money to achieve your goals. With that in mind, these free budgeting worksheets can help you understand where your money is going.
You can use the worksheets to categorize your transactions and define expenses as you build your budget.
Budgeting worksheet tips
Always plan for the real income you receive, and not the income you should receive.
For instance, let’s say you have a child support order, but you don’t receive regular monthly payments; don’t include that money in your income calculation.
Take a 3-month average for regular expenses with no set cost.
Many flexible and discretionary expenses have no set cost. To set a practical spending limit, take an average of what you spent for that expense in a normal 3-month period. Hint: Don’t use December, since most people don’t spend normally during the holiday season!
Set a high target for bills with varying monthly costs.
Bills like utilities and mobile plans can have varying costs throughout the year. If you’re trying to set a budget for the year that you don’t need to change, choose the highest annual amount. That way, you can always cover the bill and use any extra cash on lower months for saving or covering unexpected expenses.
Make sure to balance your expenses against your income.
Once you have the income and expense worksheets filled out, compare the totals. At a minimum, you must spend less than you earn if you want to avoid debt. At best, you should only spend about 75 percent of what you earn.
A budget shouldn’t be set in stone.
Your numbers will change as you and your family grow. Always revisit your budget when you get a new bill, start regularly spending on a new expense, or have a change in your income.
Review your budget often to make sure you’re on the right track.
If you find you’re regularly overspending on a certain type of expense, you may need to adjust your spending target. Just remember to keep your budget balanced!
Use your budget to pay off your debt faster.
Use your income and expense worksheets to see how much extra cash you can devote each month to making larger payments on your debt. Then use the debt worksheet to prioritize your debts, either from highest to lowest APR or lowest to highest balance. Find out more in our free guide: How to Reduce Credit Card Debt.