Life

How To Budget Like A Pro

Budgeting. It’s one of those things we all have to do, but some of us don’t enjoy it. Well, budgeting is one of my secret hobbies. I’ve always been pretty good with money (thanks, mom), but as I got older and more bills started coming, I had to take a step back and re-evaluate my budget.

First, I’m going to give you a little backstory on how I used to manage my money. Basically, I would just use a checkbook register to write down all of my purchases. I didn’t really have a set “budget” to stick to. I just knew the amount of money I had in my account and made sure not to go over it.

After realizing Austin and I both need to communicate what we spend in order to stay on top of our money, I decided to actually start budgeting. I downloaded and researched tons of different budget apps, only to find one that I fell in love with. The one we use is called Every Dollar made by Dave Ramsey. There’s an app for your phone and also a website. This is really helpful when you’re planning your overview.

How to use Every Dollar

When you first go to the Every Dollar website, you have the option to go premium. I personally prefer the free version. The only real difference is the premium version automatically grabs transactions from your bank account, but I enjoy writing (or typing) everything down so I know what I spent.

Now it’s time to make your budget. You can either make your budget one month at a time or go ahead and plan out your yearly budget. I chose to plan out the entire year just to make sure we have enough income for all of our expenses. I made a category for every single one of our expenses. I’ll break all of this down below.

Break down of our Every Dollar Budget

Income

Giving

-Church

-Charity

Savings

-Savings (This is our “fun” savings for things like vacations.)

-Emergency Savings (This is for expenses like losing a job, a car breaks down, etc.)

-Bill Savings (This is for those bills you get hit with at the end of the year – taxes, etc.)

-Roth IRA

Housing

-Mortgage

-City

-Electricity

-Cell Phone

-Internet

Transportation

-Auto Gas & Oil

Food

-Groceries/Eating Out

-Coffee (Yes, we are a little addicted so it gets its own category 😉)

Lifestyle

-Austin Spend Money

-Ashley Spend Money

-House Renovation/Furniture

-Spotify

-Gifts

-Miscellaneous

Insurance

-Auto

Debt

-School Loans

So, this is the basic breakdown of our budget on Every Dollar. Just play around with it until your budget fits your income. Every time either of us makes a purchase, we both add the transaction to the correct category. That way, we both know our money situation for that given month! You simply log in to the app with the same username and password. It’s so easy!

Other Ways to Keep Track of Money

Now I go a little bit overboard on things like this. I want to make sure our budget stays balanced. For instance, obviously, your income is projected. Most jobs don’t give you your paycheck on the first day of the month. Because of this, your Every Dollar budget does not reflect the actual amount of money you have in your account. To fix this, I have a notebook that I basically made into a check register. I’ll break down the sections.

Account Overview – This just shows all of our bank accounts and the use we have for them.

Notes – If we have an automatic payment or transferred scheduled, I write this down on the notes page.

Emergency Savings – This is used strictly to keep up with the amount of money we have in this account.

Savings – This is used just like the Emergency savings.

Bill Savings – Surprisingly, same goes for this one.

Bill/Household Checking – This is the account we make our purchases on, so every night, I go through and write down all transactions that were made.

Fun Checking  – We use this account for any money we make that’s not in our budget. For example, money I make from free-lancing goes in this account. It’s basically our backup money, even though we call it fun checking.

Money Not Taxed – Most of your money is untaxed when you freelance. This means you’ll owe on it at the end of the year. We keep a record of this here so we can predict how much we will have to pay at the end of the year.

This method of budgeting has made money a less stressful topic. I hope it helps you out, too! If you have any budgeting tips, leave them in the comments below!

Talk soon,

Ashley

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