Believe it or not, making a family budget is not as easy as it may sound. And although budgets may not be essential to keeping your finances under control, they do allow you to make calculated decisions about how to spend your income. When making a budget, it’s important to identify the right method for creating and keeping track of their budgets. The two most basic ways to do so is by using modern electronic means such as a computer-based spreadsheet, or good old-fashioned pencils and notebooks for making and storing budgets.
Electronic Sources
There are lots of available software budget options available for those who are interested in going the electronic route; Budgetpulse, Bugdetsimple, Thrive, and Pearbudget are just four examples. It is advisable to compare different software before choosing the most suitable software for making family budgets. Thankfully, all that is required in most cases is entering budget and expense data — which leaves the math to be completed by the software. From there, the bulk of the remaining work comes down to simply monitoring your budget and making sure you stay on track.
Budgeting the Old Fashioned Way
If you’re the type that prefers keeping the family budget in written form, you’re in good company — there are still millions of people who do it this way. The most common method is to use a notebook to identify all of your income sources and expenditures. Create two adjacent columns; then tabulate all of your income sources in one column and your expenditures in the other. Of course, your goal is to ensure that your household income exceeds the expenses; if not, you’ll have to prioritize your spending and reduce your unwanted expenses — preferably by cutting discretionary expenses like entertainment, while prioritizing bills and basic needs.
Photo Credit: tax credits
I constantly waver between the digital and paper. I’ve generally found that digital is better, but for urgent needs and focus points it makes a difference when I put pen to paper, if that makes sense. I know it may not for most people!
I switched to electronic years ago. Using Google Sheets, my wife and I can both have access to the budget at all times. For example, if you’re shopping and wondering how much you can spend, you can check it right from your mobile device. I do this all the time. No more paper for me!