Setting Up a Budget: Everything You Need to Know

Previously, we’ve discussed why creating a budget can be so important. And we even discussed the basics of budgeting. But I have gotten a ton of questions about those articles. The main one is wondering why I tend to shy away from giving you actual numbers to use. 

Fortunately, that ends today. Well, sort of. Because I’m going to give you the exact templates I use. (Although, I made them a little prettier!) I won’t give my specific numbers or anything. But I will include examples to help you fill yours out. Hopefully that will alleviate any confusion!

But Why Don't I Share Numbers?

I feel that it can create unnecessary pressure. Every single one of us is different. We have different jobs, different bills, and different hobbies. Not to mention, we all have different priorities. That means all of our finances will be, at the very least, a little bit different. Some of us value food, health, fashion, travel, toys, the list is endless. So, we’re all going to spend our money differently. 

To make matters worse, we’re all at different stages of our financial journeys. So, some of us have more debt than others. And some of us have more savings than others. Some have even managed to invest more than others. Basically, we’ve all had different opportunities or advantages. And I’d hate to show you my exact budget and it make you feel bad for not being where I’m at on your journey.

What Does That Have To Do With Creating a Budget?

I know it seems counter-productive. I just believe that it can be super discouraging. Sitting down and mapping out how far you have to go. On top of how long it could take you to get there. That could turn you away from the whole concept before you even start. And, in my opinion, starting a life-changing journey is the hardest part. Because we have to let go of the fear. The fear that we’ll mess up. Or the fear that we’ll fail. I don’t want to make it any scarier for you!

Because it doesn’t need to be scary at all! The whole point of a budget is to tell your money where you want it to go. It’s that simple. Fortunately, our priorities and goals will dictate exactly that. So, you have all the information you need right there in front of you. All you need to do is figure out how to make your plan. Thankfully for you, I’m incredibly awesome. So, I created a free template for you to use! All you really have to do now is plug in your numbers and go for it!

Is It Really That Simple?

Well… Maybe not quite that simple. Because you do have to stay on top of it. But, I came up with a list of essential tips that can help you stick to your budget!

How to Set Up a Budget

Disclaimer: This post may contain affiliate links, but all opinions are my own. This means, if you make a purchase using these links, I make a small comission at no additional cost to you. For more information, please read my disclosure policy.

Make it ahead of time

The best way to ensure that you’ll stick to your monthly budget, is by making it before the beginning of each month! Of course, you can start halfway through the month if you want. It just might make things more confusing the first time. So, I’d recommend making next month’s budget the day before! That way, each billing cycle is brand new. You won’t have to wonder if you missed anything. Or if anything was late and might have added fees.

Be Realistic

If you’re anything like me, you set outrageous goals you’ll never reach. (No? Just me?) It’s incredibly important to set goals you can actually succeed at. Because if you never hit any of your goals, it will discourage you from sticking with it. But, it’s also important to push yourself. So, make sure you include savings goals or debt payoff goals. Just attainable ones. Maybe set a goal to pay off your credit card by the end of the year. Versus trying to pay all your debt off in one month.

Budget to zero

I’m not saying you can spend zero dollars on fun things. I’m just saying you should budget every single dollar you earn. So, let’s say you earn $2,000 this week. Look through your budget and decide exactly where each dollar will go. If you really enjoy online shopping, then include it in your budget. If you know you’re going to the bar, create a spot in your budget for that. Set a dollar amount that you allow yourself to spend. And then stick to it. You’re still allowed to enjoy your life. Just try to mind your spending while doing so!

Make Changes

You’re already going to make a new budget before each month. (Right?) So, don’t be afraid to make changes. If your electric bill went way up, then increase that part of your budget. Or, if you find yourself blowing through your grocery budget, maybe it should be increased. Likewise, if you’re spending way less on something, you can decrease the amount. Then, put that money towards something else. Like a debt. Or your savings.

setting up a budget

Create Sinking Funds

Sinking funds are my new favorite part of my budget. Which you can probably tell from my Instagram. You can create a sinking fund for any major expense you plan to face. Like a vacation or even holidays or birthdays. Sinking funds could also be for medical needs, like your deductible. Maybe you need vehicle repairs or a home remodel. Honestly, anything you want to save up for can be a sinking fund. Make a spot for it in your budget and put money towards it each month.

Prioritize Your Budget

While you do have to pay your bills, the great part of a budget is deciding what to do with the rest. You’ll need to prioritize your goals first. Then, put the leftovers towards your fun money. Let’s say you have a goal to pay off your credit card with $2,000 on it. If you put every dollar towards entertainment and none towards your card, you probably won’t be able to reach your goal. Try to stay on top of your priorities so you can reach your goals quickly!

Stay Organized

You need to keep track of everything regarding your budget. For example, your bills. Staying organized helps to make sure everything gets paid on time. So you won’t waste your hard earned money on late fees. You also need to keep track of your spending habits. Even if it’s a small amount. In fact, especially if it’s a small amount. Those under $5 expenditures really add up when you’re not writing them down.

Give yourself grace

One of the most important tips for setting up your budget is to give yourself grace. You’re going to mess up sometimes. I do it a lot actually. So be prepared to forgive yourself. There’s no need to beat yourself up when you have a slip up. Just try to remember that situation for the future. That way, you won’t make the same mistake again.

The Ultimate Template for Setting Up Your Budget

Now, for the exciting part! I’ve created a simple – yet effective – free budget template. This will help you keep track of everything and stay on top of your goals! I made a pdf version to print out and keep in your office or on your fridge. Plus, you can laminate them to reuse each month so you don’t have to reprint a bunch of times. (Yay!) I sincerely hope you find them as useful as I have!

*Keep in mind: The first four pages are the examples, so skip them when printing to save on ink!*

Don’t forget to comment below if you have any other great tips to help us set up our budgets!

7 thoughts on “Setting Up a Budget: Everything You Need to Know”

  1. Great and informative post! The tips are practical and feel doable which is sets the right mindset when you start budgeting. Thanks for sharing and for the templates!

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