How to Create a Budget

Learning the Skills of Personal Budget Planning

How to create a budget is easier than you think. It starts with a little planning, a few tears, and maybe a small little tantrum. But after that it gets much easier – really!

First comes the listing of all your monthly income and outgo (this is the tantrum and tear part – but once it’s done the tears are over, I promise. You’ll feel free and excited about your new budget).

Please use our Monthly Budget Worksheet and the Printable Budget Percentage Guideline for easier use.

First list your income:

  • Salary:
  • Spouse’s salary:
  • Interest/dividends/stocks:
  • Child Support:
  • Refunds:
  • Tax Refunds:

(If you have a non-fixed income use your yearly income divided by 12. )

Second list your outgo:

  • Fixed Household expenses:
  • Fixed Car expenses:
  • Federal taxes/state taxes/SSI taxes:
  • Resident Tax:
  • Insurances:
  • Food:
  • Utilities:
  • Outstanding Debt:
  • Insurance:
  • Entertainment/trips:
  • Medical/dental:
  • Savings:
  • Miscellaneous:

Learning what percentage should go for expenses will help you and your family live within your means. To begin, get your net-spendable income and expenses together.

Take the above numbers and calculate a percentage of each category. The below outgo percentage is a starting point of how a typical family lives.

However, every family is different and every household has different needs and expenses according to their lifestyle. After calculating your percentage, decide with the family how each of you will commit to living within your new means (or percentages).

  • Tithe 10%
  • Housing is 29%
  • Food: 9%
  • Automobiles: 12%
  • Insurance: 5%
  • Debt 5%
  • Entertainment/Family Trips 4%
  • Savings 15%
  • Medical 3%
  • Miscellaneous 4%
  • Education 4%

As a side note, when we look at these numbers it’s easy to become depressed because these numbers do not work for most people. However, by having an idea of what will work for your family, the easier it is to create a budget that matches your family’s lifestyle and preferences.

As you download the Monthly Budget Worksheet in PDF and the Free Printable Budget Worksheets Percentage Guide in PDF you will have a better idea where you spend your income and where you can place the right amount of percentages for your family.

For example, I own my car free and clear and have no debt, so I can take those percentages and put them towards what I need most which is savings and paying off my house.

The purpose of the guideline budget is to determine what percentage of your current spending patterns and determine the areas of overspending. However, only you can determine where you spend and if you are overspending.

When thinking about how to create a budget, we are creating it to work for our family only, no one else. So if spending 25% of your budget on clothing and only 6% on food works for your family than that is great. This is to help you set up guidelines on how much you’d like to spend in each category. Obviously if you are spending a percentage of your income that doesn’t exist than it’s time to rethink your percentage.

For More Resources on How to Create a Budget Please See:

Personal Budget Planning

How to Make a Budget

16 Fabulous Budget Tips for Meals

Impluse Purchases PDF

Monthly Home Budget Worksheet PDF

Monthly Income Expenses Worksheet PDF

Free Printable Budget Worksheets

Free Printable Budget Worksheets PDF

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