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How to Set Up A Simple Family Budget

Updated on July 24, 2012

Set Up Your Budgt Now

A simple family budget used to be a husband handing his wife his paycheck and saying “Disperse these funds as you see fit”. Well times have changed. The economy has changed. Now in order to survive and put a little money away for retirement and and to have some extra money for those ever occurring rainy days you need to know where your hard earned cash is going.

Being an overachiever I set out to track as much of my income and expenses as possible. I quickly learned you had to have a college degree in accounting to use some of the so called simple budgeting systems. Never the less I was determined to set up a family budget and make it work. A few weeks later, only kidding, after a few days I had a set of spreadsheets set up and ready to be put to use. Note, if you really want to use this method there are plenty of examples online.

I discovered after many trials and many more errors, the more complex you make a budget the harder it is to follow. In the beginning I created all of these elaborate worksheets to try and keep track of my income and expenses. It didn't work. Why, I just got tired of sitting down and opening up each spreadsheet and recording all my expenses. In the end I stopped. I decided this system did not work well with my right brained mind.

Don't get me wrong I am not knocking any of these systems. I am sure there are people who are reading this who are using similar systems to the one I used and are being successful. It was just hard for me to motivate myself to actually sit down and log everything into each of the sheets. The main thing you want to do is to find a system you like and one where you can track your income and expenses.

My next step was to create a more right brained friendly family budget system. In the end I created a simple family budget I could live with and use properly. The income portion of my budget is done my making sure all the money we make ends up in the bank. Oh yeah I forgot we do hold back some money for fun outside the home activities.

For the expenses portion of my simple family budget I took all I my expenses and divided them into five major categories-food, household expenses, car repairs, personnel expenses and bills. Under these five categories I also created some subcategories like under household expenses I created a place to track household repairs. I use file folders to keep all my receipts in but I do know other people who use envelopes or a twelve pocket file folder.

At the end of the first year I had a pretty good idea of what we were spending on what. This helped me to set up a budget for the next year. I also added a small budgeted increase in each category. Inflation creeps up on you so be prepared.

I have been using this system for a number of years now and it works well for me. I have also discovered for a simple family budget to do you any good in the long run you must make a lifetime commitment. Yes, I said a lifetime commitment..

A budget is like a weight management program most of your time is spent in the maintenance stage. Once you get your spending under control you need to stay within your budget so you don't end up the same sorry state your were in before. Don't be afraid. You can do it.


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