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Friday, January 30, 2015

How Do I Make A Budget? Part 2

How Do I Make a Budget???? Here’s What Ours Looked Like

One of the biggest questions we receive is, “How do I make a budget?” We felt this way too when we first started our journey. Neither one of us had EVER made a budget before. It can be overwhelming at first. The great news is that we now really enjoy the budget and can’t go without it.

So where do you start? Here are our suggestions:

1.   Know what you make each month. Take the budget a month at a time. That way it’s not overwhelming. Add up EXACTLY what you make in a month. That’s step 1.

 2.   Figure out what comes out in bills. For example, our bills category had the following:
·         Phone
·         Car Insurance
·         Utilities
·         Internet
·         Rent
·         Compassion Child
·         Minimum Payments on Loans

 3. After we figured out what our bills were, we moved on to monthly expenses. So take the number you are at after subtracting bills and start subtracting monthly expenses. Ours included:
·         Tithe – 10% of our income
·         Gas - $400 a month  (We could usually save on this one)
·         Groceries - $400 a month (This is the one we STRUGGLED with. We won’t tell you how many times we went over budget on this one. Show yourself grace)
·         Fun Money (Money we could spend on what we wanted) $50 each
·         Date Night - $50
·         Miscellaneous - $50
·         Vacation - $80
·         Birthdays/Gifts – Varied depending on the month

 4.   After you have subtracted your monthly expenses, see what you have left. Take that and, if your emergency fund is complete, throw it at debt. EVERY penny counts.

5.  Take a good look at your budget and see what you can cut out. We cut out cable and downsized our apartment to save on rent. Debt freedom doesn’t come without sacrifice.

 6.   SHOW YOURSELF GRACE – The first month of the budget was HARD. We went over, we spent too much, we fell off track, etc. This process is hard. Don’t beat yourself up if it takes you a few months to get the hang of a budget. It takes time to learn new habits. You CAN do this.

 7.  Have monthly money meetings to look at the budget. Decide what’s going well and what you can change.
We did our budget each month by hand. We didn’t keep a spreadsheet on this, but simply kept a notebook. We hand wrote it each month, and we checked the boxes throughout the month as a payment came out.  This was the way that worked for us. Find the way that works for you. We still keep our budget this way even being out of debt.  This is what it looks like:

This is what it looked like the first month.  Notice all of the boxes . . .

This is what it looks like now.  Much smaller.  I believe this is what the kids call:  "Winning!"

This was our template, but we encourage you to get on the web and look around.  There are a million budget templates out there!  Also, if you're teach savy unlike us (just look at the blog:) you can even keep this more organized on your computer.  Find one that works for you.

You can do this. It is hard. It takes time and effort to learn. Your budget will be hard this first month. However, it is SO worth it. You will be amazed at how much money you have in a month when you know where it all goes.  Take control of your money and take control of your life.

In Christ,

Bryant and Emily Adler

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