Financial Planning Series: How to Make a Budget

This article is the introduction to a multiple part financial planning series called How to Make a Budget (the unboring way).

I’m dropping the B-word today. BUDGET! There, I said it. It’s funny how this simple 6 letter word has the power to strike fear into the hearts of some and cause serious indigestion for others. If your heart is fluttering and your stomach just lurched, then you’re not alone.

How to Make a Budget:
  1. Your Net Worth
  2. Net Worth Spreadsheet
  3. Financial Goals Worksheets
  4. Needs and Wants List
  5. Free Budget Spreadsheet
  6. Free Budget Software
  7. Track Extra Income
  8. Gift Giving Worksheet
  9. Holiday Expense Tracking
  10. Windfall Planner
  11. Debt Reduction
  12. Student Budget
  13. Medical Expenses
  14. Emergency Fund
  15. More to come!
  16. Subscribe to not miss it!

Despite it’s reputation for being boring, time consuming, and out-right tedious, creating a budget can actually be a liberating experience. Now, I’m not squawking about the kind of liberation where you’re running around naked with millions of dollars flying around you. Yeah, that’s my dream too. Sigh.

But seriously, keeping on track with a budget can show you where your money goes and help you plan for life’s expenses — whether you’re saving for a home, buying a car, going on vacation, saving for school, getting out of debt, starting an emergency fund, or just finding ways to save money. Whew!

It was, after all, through expense tracking and financial budgeting that I managed to pay off my student loan in six months and start investing in exchange-traded funds — how’s that for financial freedom?

A simple budget can also help you reach your financial goals sooner with less stress and worry.

About the How to Make a Budget Series

I want to make budget planning fun by squawkifying the process in a useful way. I would love for you to experience the many financial benefits from keeping track of your money. It is your money, after all. I want the “budget word” to cease being a 6 letter monstrosity by demystifying the process and making it simple to follow.

What is a budget? Simply, a budget is a financial plan for tracking the flow of money into and out of your life. The idea is to find the sneaky money outflows, plug the lucrative leaks, and save more of the inflowing cash for the stuff the really matters in your life. A budget will also expose the spending habits you’re not aware of and help you to better plan where to spend your money.

The How to Make a Budget series can help you to:

  • Learn how to set up a budget
  • Find your net worth
  • Set financial goals, define your needs, know your wants
  • Start expense tracking and track household expenses
  • Get tips on budgeting for any income
  • Make a household budget
  • Download free budget worksheets and budgeting spreadsheets
  • Benefit from budget planning tools
  • Discover financial budgeting software
  • …and have fun with it! :D

If you have read my previous resume series, then you know I put A LOT of time and effort into making each and every post packed with helpful, funny, and very approachable content. In similar squawky fashion, the How to Make a Budget series will run over the course of a few weeks and offer many budgeting tools, financial planning tricks, and some serious budget worksheets to get you on the right financial track. I am very excited about this budget series, and I hope you are too.

Your Two Cents: Have you ever tried budgeting? Were you successful or do you have a budget beef?

Your two cents:

  1. Olivia March 4th, 2010

    Yes we do have a budget. It’s the only way we can keep afloat, as every penny counts for us. It allows us to track progress, rearrange if need be to cover unexpected expenses (beyond the budgeted emergency fund), and keep us honest with what we take out. Somehow the anticipated act of writing things down makes us scrutinize the possible purchase beforehand. It’s not all deprivation though, each of us has a small bit of mad money every pay check.

  2. Chris March 4th, 2010

    I couldn’t agree with you more that budgeting is key to financial success. I tried Mint.com and Justthrive.com for 3 months before making my budget. They helped me understand where I was spending my money and then plan on how to reduce certain expenses. Another cool program that incorporates both financial planning and budgeting is FinanceLogix.

  3. DaniDo March 4th, 2010

    Thank you for this upcoming series, I am very excited about it as I am just in the process of starting to create a budget for our family. Right now I am still in the stage of tracking our spending to see where it is all going! Our goals are ALL of the things that you mentioned – building some savings, paying off debt, vacation, etc. As I look forward, my fear is trying to keep that budget once I have made it (or, more specifically, encouraging my husband to keep it)!

  4. Jennerosity March 4th, 2010

    I think budgets are one of the most important financial tools you can develop. Creating and sticking to a budget has been so important for myself personally, and for my husband and myself when it comes to meeting our goals. Never had much beyond a small amount of student loan debt to pay off myself, but money was always synonymous with fear for me. So when it came to taking steps to be independent, making a budget helped me to see that I didn’t have to be so afraid. Now that a lot of that initial fear is behind me, I love reviewing our budget with my husband because we get a chance to talk about our goals and see how long it will take for us to realize them. Knowing that also helps make decisions about our spending easier, since we’ve discussed our financial priorities and know how much money we have available in a pinch. Can’t imagine living without one now!

  5. Sarah March 4th, 2010

    I keep a large-scale budget by automatically separating bill-paying money and long- and short-term savings from money for day-to-day expenses. I have never gotten good at smaller-level budgets, but want to try a cash-only-for-play-money plan, which would probably help with spending and also make Mint more effective at tracking my other stuff!

  6. The Rat March 5th, 2010

    I think budgeting is very important for any household. I also know of many retired people that still have to budget when they leave the workforce, so it’s something I feel that is important to embrace throughout life.

    I’m looking forward to the series and will be by more often to check it out. First time visitor BTW – nice site!

  7. Kendra L March 5th, 2010

    I have kept a budget for a long and some new tips would be welcome. Thanks for a terrific web site.

  8. Greg March 7th, 2010

    I have started and quickly given up on budgets many times over the years. I’ve tried many budgeting solutions from spreadsheets to software and found them all to be lacking. Most of the software is great at tracking what I had already spent, but not very good at budgeting. Spreadsheets help with creating a budget, but are tedious to update when tracking spending.

    I found some software last year called You Need A Budget (YNAB) and have been using it for about 8 months now. It’s not just software, it comes with a money management philosophy (4 rules) and a website with very active forums and input from many users as well as the developers. It’s still not perfect, but it is by far the best system that I have found so far. I’m surprised that I actually like using it and I think their web community really helps with that.

    I look forward to reading your series.

  9. Victorino March 15th, 2010

    Budgeting must also involves reevaluation and reassessment to make sure that our budget or plan is heading to its way. We also need to control and monitor if something is wrong.

  10. Terra October 11th, 2010

    thanks for this.
    I like the goal setting worksheets.
    I didn’t think at first they would help me out much. They do.
    I leave them out on my desk and it helps me prioritize my needs and wants.
    When I have a goal concrete in mind like that it prevents me from being impulsive and I continally can keep myself on track with a quick glance.
    It helps me to put finances on the forefront, as they need to be, as they have suffered so much from not being on my radar at all.
    I also feel much more in control with my finances, and do not feel ruled by them.
    It might take me a while to achieve financial peace of mind, but at least I am doing something, and am on the way.

  11. Terra October 11th, 2010

    ps.how do I get rid of/change the picture associated with my comments? I can’t figure it out.

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