ArtsAutosBooksBusinessEducationEntertainmentFamilyFashionFoodGamesGenderHealthHolidaysHomeHubPagesPersonal FinancePetsPoliticsReligionSportsTechnologyTravel

Budgeting example

Updated on September 2, 2020

Budgeting Tips

Don't Be Afraid To Budget

The word "budget" intimidates many people, however it should not. YOU are in control of your budget, YOU set it up each month. Once the budget has been set up, then it is important that you stick to it.

Let's take a look at an example. Since I live in Indiana, I will use Indiana's tax rate. I will use a family of 4 that has a GROSS income of $1,000 per week. The first thing I need to do is to find out the NET pay. There is a Social Security Tax of 6.2%, Medicare Tax is 1.45% and State Income Tax is 3.4%. I will also say that their employer has a 401k plan that matches 50% up to 6%. In other words if I contribute 6% to my 401k, the employer will throw in 3%. Let's say there is also a health insurance plan that they are in which the employer deducts $70 per week from the check. Let's also not forget about the Federal Income Tax. I'll just use $100 per week for that.


Budgeting Example

Here is how the net pay would look:

· Gross $1,000.00

· Social Security Tax -62.00

· Medicare Tax -14.50

· State Income Tax -34.00

· 401k contribution -60.00

· Health Insurance -70.00

· Federal Income Tax -100.00

· NET PAY $ 659.50

Now let’s begin our budget. If the net pay is $659.50 per week and there is 4 weeks in a month, the net monthly pay is $2,638.00.

Then get out all of your bills and make a list. You are doing this so you know what you are going to have to pay. I am talking about ALL of your bills. Your utility bills, credit cards bills, mortgage and even the bills that you do not pay every month like car insurance or life insurance.

One you have a list of your bills, get a piece of paper and write at the top $2,638.00. This is how much you have to work with. Unlike the government, you can not print money when you run out nor can you keep having deficit spending. You must stay within our budget.

Here is an example of how the budget would look:

· GROSS INCOME $2,638.00

· Food -480.00

· Mortgage -650.00

· Gas -90.00

· Electric -80.00

· Water & Sewage -40.00

· Telephone, Cable, Internet -130.00

· Clothing -100.00

· Health ins. deductible -100.00

· School Supplies -100.00

· Home Insurance -30.00

· Property Taxes -75.00

· Life Insurance -30.00

· Car Insurance -30.00

· Car Gas -200.00

· Car Repairs -70.00

· Kids Allowance -80.00

· Parents Allowance -160.00

· Other Debt -125.00

· Charity -68.00

· NET INCOME 0.00

As you can see, the top priority is to be sure to have food. This does not mean that you can have steak. You have to go with what you can afford. It may be Banquet TV dinners or soup. You see the next thing is to be sure you have shelter so you should pay your mortgage and utilities.

You are also setting aside money to prepare for the future. When you car insurance comes due, you won’t have to scramble to find $900.00, you’ll all ready have it. The same is true with your other non monthly bills.


A Budget Helps You Control Your Money

Stay Within Your Budget

It is important as you do your budget to stay within your budget. That may mean that you get your clothes at a rummage sale or Good Will. One thing to remember is that 4 times a year, you will get an extra week in the month. What that will mean in this case is about an extra $429 after you subtract for groceries, gas and allowances. Multiply that time 4 and you are getting an extra $1,700 to apply to your debt, save for a car, vacation or something.

Also, if you need or want more money, you can always pick up some kind of part-time job. You could also offer your services such as mowing lawns, cleaning houses or taking care of people's pets when they are on vacation. Another thing I want to point out in this example is the other debt. If you are debt free, that would free up $1125.00 per month. It is very important to get out of debt as soon as possible and stay out of debt.

This article is accurate and true to the best of the author’s knowledge. Content is for informational or entertainment purposes only and does not substitute for personal counsel or professional advice in business, financial, legal, or technical matters.

© 2010 Art West

working

This website uses cookies

As a user in the EEA, your approval is needed on a few things. To provide a better website experience, hubpages.com uses cookies (and other similar technologies) and may collect, process, and share personal data. Please choose which areas of our service you consent to our doing so.

For more information on managing or withdrawing consents and how we handle data, visit our Privacy Policy at: https://corp.maven.io/privacy-policy

Show Details
Necessary
HubPages Device IDThis is used to identify particular browsers or devices when the access the service, and is used for security reasons.
LoginThis is necessary to sign in to the HubPages Service.
Google RecaptchaThis is used to prevent bots and spam. (Privacy Policy)
AkismetThis is used to detect comment spam. (Privacy Policy)
HubPages Google AnalyticsThis is used to provide data on traffic to our website, all personally identifyable data is anonymized. (Privacy Policy)
HubPages Traffic PixelThis is used to collect data on traffic to articles and other pages on our site. Unless you are signed in to a HubPages account, all personally identifiable information is anonymized.
Amazon Web ServicesThis is a cloud services platform that we used to host our service. (Privacy Policy)
CloudflareThis is a cloud CDN service that we use to efficiently deliver files required for our service to operate such as javascript, cascading style sheets, images, and videos. (Privacy Policy)
Google Hosted LibrariesJavascript software libraries such as jQuery are loaded at endpoints on the googleapis.com or gstatic.com domains, for performance and efficiency reasons. (Privacy Policy)
Features
Google Custom SearchThis is feature allows you to search the site. (Privacy Policy)
Google MapsSome articles have Google Maps embedded in them. (Privacy Policy)
Google ChartsThis is used to display charts and graphs on articles and the author center. (Privacy Policy)
Google AdSense Host APIThis service allows you to sign up for or associate a Google AdSense account with HubPages, so that you can earn money from ads on your articles. No data is shared unless you engage with this feature. (Privacy Policy)
Google YouTubeSome articles have YouTube videos embedded in them. (Privacy Policy)
VimeoSome articles have Vimeo videos embedded in them. (Privacy Policy)
PaypalThis is used for a registered author who enrolls in the HubPages Earnings program and requests to be paid via PayPal. No data is shared with Paypal unless you engage with this feature. (Privacy Policy)
Facebook LoginYou can use this to streamline signing up for, or signing in to your Hubpages account. No data is shared with Facebook unless you engage with this feature. (Privacy Policy)
MavenThis supports the Maven widget and search functionality. (Privacy Policy)
Marketing
Google AdSenseThis is an ad network. (Privacy Policy)
Google DoubleClickGoogle provides ad serving technology and runs an ad network. (Privacy Policy)
Index ExchangeThis is an ad network. (Privacy Policy)
SovrnThis is an ad network. (Privacy Policy)
Facebook AdsThis is an ad network. (Privacy Policy)
Amazon Unified Ad MarketplaceThis is an ad network. (Privacy Policy)
AppNexusThis is an ad network. (Privacy Policy)
OpenxThis is an ad network. (Privacy Policy)
Rubicon ProjectThis is an ad network. (Privacy Policy)
TripleLiftThis is an ad network. (Privacy Policy)
Say MediaWe partner with Say Media to deliver ad campaigns on our sites. (Privacy Policy)
Remarketing PixelsWe may use remarketing pixels from advertising networks such as Google AdWords, Bing Ads, and Facebook in order to advertise the HubPages Service to people that have visited our sites.
Conversion Tracking PixelsWe may use conversion tracking pixels from advertising networks such as Google AdWords, Bing Ads, and Facebook in order to identify when an advertisement has successfully resulted in the desired action, such as signing up for the HubPages Service or publishing an article on the HubPages Service.
Statistics
Author Google AnalyticsThis is used to provide traffic data and reports to the authors of articles on the HubPages Service. (Privacy Policy)
ComscoreComScore is a media measurement and analytics company providing marketing data and analytics to enterprises, media and advertising agencies, and publishers. Non-consent will result in ComScore only processing obfuscated personal data. (Privacy Policy)
Amazon Tracking PixelSome articles display amazon products as part of the Amazon Affiliate program, this pixel provides traffic statistics for those products (Privacy Policy)
ClickscoThis is a data management platform studying reader behavior (Privacy Policy)