A Household Budget
Will Improve Your Life!

You've probably heard about the value of a household budget for a long time. If you are like most people you have no idea how to make a budget though.

Let us teach you how to make a budget as well as how to use a budget.

Click here to share your favorite budgeting advice that will help others become financially free!

All it takes is your time and some simple tools like a pencil, some paper, a calculator, or a spreadsheet on your computer. There's no need to spend a lot of money on a fancy program unless you like that sort of thing.

Step 1: Track your income and your expenses for a month

The logical starting point in creating a household budget is to understand how much money you have and how you spend it each month. Get ready for a few surprises.

We have a free Budget Worksheet to help you with this task. You need to track all incoming money as well as all outgoing money for a month. Document everything on the Budget Worksheet, paying close attention to cash and coin transactions that may fall through the cracks.

Don't get discouraged. A household budget will bring freedom once it is in place. You just have to start.

Step 2: Group your expenses into logical categories

As you look through your receipts and notes you've collected over the past month you will see natural groupings for your expenses. These groupings will make the budget categories flow logically instead of randomly. You'll be thankful in the long run.

Use our free Household Budget Worksheet to help you create the categories and groupings you will need for your budget. There are many predefined categories but it will need to be revised to meet your exact budget needs.

When you are finished you will have a budget template designed specifically to help you with your budgeting needs.

Step 3: Input the income and expenses you collected

Based on the income and spending data you have collected you can now fill out the Household Budget Worksheet to see where you stand. Do you have a budget surplus or are you spending more than you earn? Unfortunately, most individuals and families fall into the latter category.

That is why budgeting is so important!

Step 4: Transfer your data to our budget spreadsheet

You've completed all the hard work and now you get to see your completed budget. Excited? You should be. This is a major financial step you are taking and it will only make your life better!

Download our budget spreadsheet and transfer the numbers from the budget worksheet into all of the matching categories. If you made edits to the budget worksheet you will need to make the same edits to the budget spreadsheet. Now all that is left is to adjust the spending in those categories that have flexibility until your budget balances.

Yes, the goal here is to have a balanced household budget. You may have to make some lifestyle changes to reach that goal. This is obviously the most difficult part of making a budget but it still beats the alternative of going deeper into debt every month.

We've all heard it before. You need to live within your means. Don't spend more than you earn. It may not always be as much fun, but your stress will be much lower at the end of each month. At least now you have a good view of where your money is going and you are the one in control.

Don't fret, you made the decision that you need to live on a budget and it was a wise decision. There are creative ways to make it easier to stick with your budget. We will provide those tips in the near future. For now, get in the habit of finishing what you started.

Once you get used to living on a budget you might want to step it up a notch and create a debt reduction budget with the goal of eliminating your debt altogether. You'll be amazed at how much money you can save when you put your mind to it.  Give it a try once you are ready.

With a household budget you will never again have to worry about how a bill will be paid. You have a plan and you follow it every day. That truly is freedom!

As you begin living on your budget you will find there are times when your resolve wavers. That's a very normal response. Take a look at the Benefits of Budgeting page we have developed to help you find new motivation in sticking with your budget. Return to it as often as necessary to help keep you on the right track.