Welcome back! Yesterday I introduced my Budget Binder including information on accounts, income tracker, bill due dates and annual expense categories. Click HERE to review that information. Today I'm going to share the second half which will cover the monthly budget, goals, calendar and cash envelope system.
*Modified or added section or subsection
Budget Binder : Household Budgeting System
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| ABFOL Budget System |
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| Binder - old (similar here and here) \\Tabs (Colored over with marker) |
Monthly Budget
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| Clear Dividers\\ Colored Paper ($0.05/piece from Office Max) |
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| 12 Month Avery Dividers |
Each month will have one set of each subsection: monthly expenses, variable expenses, envelope system and weekly budget (one for each week of that month).
For example April has 5 weeks so it will have:
1 monthly expense sheet
1 monthly variable sheet
1 envelope system sheet
5 weekly budget sheets
This page allows me to write down all of our bills & expenses that occur each month. I take the total amount due for a bill and divide it over every pay period (if you get paid weekly: 4, bi-weekly: 2, once a month:1). For example if your car payment is $400 a month and you're paid weekly, you should budget $100 for every paycheck to go to your car payment. This will help keep your total weekly expenses the same & eliminate having one paycheck gone before you get it because you had to pay the mortgage. Columns are labeled:
- Debt (Bill)
-# of Week
For example April has 5 weeks so it will have:
1 monthly expense sheet
1 monthly variable sheet
1 envelope system sheet
5 weekly budget sheets
Monthly Expenses
- Debt (Bill)
-# of Week
Variable Expense
The variable expenses sheet is the same method as the monthly expenses but for those unexpected bills that may occur - car repair, hospital visit, etc. Columns are labeled:
-Debt (Bill)
-Amount Due
-Due Date
-Date Paid
-Balance
Envelope System
This page tracks our cash envelope budget by week. We have a set amount budgeted for each category: groceries, gas, entertainment, personal care, and household. Any money not used goes into savings or debt repayment. Read more about Dave Ramsey's cash envelope system here. Columns are labeled:
-Category
-# of Week
Weekly Budget
This page is a week by week detailed look for our cash envelopes. The point is to keep us accountable with our cash envelopes. I'm debating on cutting these up and placing them right in the individual envelopes that we use. Columns are labeled:
-Date
-Category
- $ (Amount)
Goals*
Dave Ramsey's 7 Baby Steps
Monthly 7 Baby Steps Update
Dave Ramsey's 7 Baby Steps:
1: $1,000 in Emergency Fund
2: Pay off all debt using debt snowball
3: Save 3-6 months of expenses
4: Invest 15% of income into Roth IRA or pre-tax retirement
5: Personal development funding
6: Pay off house early
7: Build wealth & give
You can read more about Dave Ramsey's 7 Baby Steps here.
Once I have completed a step I will write the date it was achieved (do a little dance) and move on to the next step. On the next page I will be tracking how I am doing overall with the steps for each month. As an example July could say: Currently on step 2 - 50% of original debt is paid off. Goal of getting rest paid off by December 2014. This just helps us look at where we are & what we have accomplished. Columns labeled:
-Month
-Notes
-Month
-Notes
50/20/30 Rule
Monthly 50/20/30 Rule Tracker
50/20/30 Rule:
Essentials: No more than 50% of your take home income should go toward Essentials. Essentials consist of four categories: Housing, Groceries, Utilities & Transportation.
Financials: At least 20% of your income should go towards financials. Financials include Debt, Savings, and Retirement investments.
Lifestyle: No more than 30% of your income should go towards lifestyle. Lifestyle is an array of categories including (but not limited to) cable, Internet, hobbies, vacations... etc. It's important to not feel guilty about this section - life should be enjoyable!
Essentials: No more than 50% of your take home income should go toward Essentials. Essentials consist of four categories: Housing, Groceries, Utilities & Transportation.
Financials: At least 20% of your income should go towards financials. Financials include Debt, Savings, and Retirement investments.
Lifestyle: No more than 30% of your income should go towards lifestyle. Lifestyle is an array of categories including (but not limited to) cable, Internet, hobbies, vacations... etc. It's important to not feel guilty about this section - life should be enjoyable!
Read more about the 50/20/30 Rule here.
I like the 50/20/30 Rule because it breaks down spending into 3 main categories which are compatible with the other areas & goals of our budget binder.
I add up each month of the 3 categories as a percentage of the total and see if I'm on track. If I'm not, I'll make adjustments accordingly for the next month. At the end of 2014 I'll be able to average each category to see how I did overall for an entire year (or March-December anyways). Columns are labeled:
-Month
-Essential
-Financial
-Lifestyle
Calendar*
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| Free Printable |
January - December
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| Free Printable |
The calendar section of my budget binder is a quick snapshot of our budgeting each month. It encompasses almost all of the other sections into one area. It is color coded by category:
Green- Bills Due
Blue- Luke pay day
Red- My pay day
Purple- Annual Expense
Orange- Relevant Goal notes
Sticker- Bill paid
I can then come back at the end of each month and get an idea of how we did in one look. I have a feeling this will be my most referred to page for staying on track.
Green- Bills Due
Blue- Luke pay day
Red- My pay day
Purple- Annual Expense
Orange- Relevant Goal notes
Sticker- Bill paid
I can then come back at the end of each month and get an idea of how we did in one look. I have a feeling this will be my most referred to page for staying on track.
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A couple other thoughts on budgeting before you go...
If you have a partner, they need to be on board, otherwise it won't work
Budgeting works at any age, income level or financial position
Living pay check to pay check is often due to a state of mind
Being organized is only half the battle - action = success
Thank you to those of you who made it all the way down here to the end! I know it was a very long couple of posts but I wanted to be as detailed as I could to not create confusion. Now go create your own budget binder and get your finances organized!
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