Budgets

Lets start with the basics of being Thrifty - the budget. This is most important because it will tell you how thrifty you have to be and it will help you achieve your goals. There is one very important rule about having a budget - hold yourself to it. A budget won't matter if you don't pay attention to it. I have tried many ways to do a budget and this was by far the easiest way (adapted from The Latter-day Saint Woman, Part A chapter 21). Start with this form, just print it out or write it down on a piece of paper:

Total Income ________________
Tithing ____________________
Church Contributions __________
Savings ____________________
Food ______________________
Clothing ____________________
Housing ____________________
Medical Expenses _____________
Transportation _______________
Utilities ____________________
Other _____________________
Other _____________________
Other _____________________
Total Expenses _______________

Now start filling it out. I will do a sample one here, it is totally made up but I will try to be realistic:

1. Total Income - $2000.00 - I did total monthly income as net income plus things that are automatically deducted such as life insurance.

2. Tithing - $200.00 - 10% of your income (go here for more information on tithing). If you don't pay tithing feel free to move on to the next point.

3. Church Contributions - $25.00 - any other church contributions such as fast offering, friends of scouting...

4. Savings - $200.00 - 10% of your income is reasonable in most situations to save for emergencies, retirement, missions... You can, if you desire, deduct the amount of money that you contribute to a 401(k) or 403(b) but the more you save when you can the more you have when you need it. This step is important now because you do not want to forget about it by putting it at the end.

Next we will work with the necessities of life: food, clothing, and shelter.

5. Food - $250.00

6. Clothing - $75.00

7. Housing - $500.00 - this is rent/mortgage

8. Medical Expenses - $100.00 - premiums, co-pays, saving up for deductibles, medications, etc.

9. Transportation - $200.00 - gas, insurance, licensing and registration, repairs/maintenance, public transportation, parking pass, car payments...

10. Utilities - $250.00 - this is everything from gas, electricity, water, trash, phone, internet, cable...

What other expenses do you have? Student Loans? Child Support? Allowance for Children? Let's say we have student loans.

11. Student Loans - $200.00

Now, total the expenses and see how you have done.

12. Total Expenses - $2000.00 - this should add up to your total income. If your expenses are above your total income you will need to really think about your expenses - what do you need? can you eat for less? where can you cut? If your expenses are below your income, hooray for you! You can readjust to distribute your money. You can create a savings pot for things you really want - a house, concert, dinners out...

Now that you have your budget planned out you need a place to record it. I have created an excel spreadsheet for each month, which is nice because it doesn't take up space. Or you can just use a notebook with a page for each month. Feel to be creative just keep it simple and easy to understand.

I have a set day - Monday - when I work on my budget. I enter any receipts that I have not yet entered and pay and enter bills every Monday. Enter what you spend as soon as possible because it is too overwhelming to deal with a pile of receipts at the end of the month (or months) and you need to know how much money you have left so you don't overspend.

This budget can be adjusted monthly or yearly as needed but I would not suggest changing for something that is paid once a year such as car registration. Figure out a high estimate on what something like that would cost and divide it by 12 so you can save a little every month. If your car costs $250 a year to register, you would save $21 a month. By the time you would have to pay the money will be there and waiting.