New budget help

[Hilltopmom]

We've been blessed (& bought a tiny cheap house years ago), so it's been years since I've had to make or follow a budget, other than common sense frugal things (buy used, shop farmers market, buy meat in bulk, no cable, no cell phones, no expensive vacations, etc)

 

Now, we're hoping to move to a much larger ( read- more expensive) house & I need to track our expenditures & make a budget to see what we can afford for a new house.

 

I can't remember how to set one up. I started listing out our yearly & monthly recurring expenses and those that change, but I know I'm missing whole categories.

 

Recommend a book or website to me that will have a list of " budget categories" & other info to get me started? I'm feeling clueless here.

And embarrassed, I did this for years & cannot for the life of me remember how.

 

(I know about Dave Ramsey, that's not what I'm looking for now)

Thanks for your help!

[HomeAgain]

Your bank may have it built in.  Have you checked?  Ours has a drop down menu for each transaction and a list of possible categories.  I do this for about 3 months' worth before looking at their pie chart of our expenses.  It's an option that has to be set up (I've set the option, dh hasn't), so you may want to look to see if yours offers it somewhere on a sidebar or something.

[AmandaVT]

I like Mint.com. You sync it up with your bank account and it keeps track of everything. The first few months I used it, I would just look at how much we were spending and where we were spending it. Then I set up budgets. They have a ton of categories too. I also like that it's free. :-)

 

Ours looks like: 

 

Health insurance

Mortgage 

Utilities 

Car/home insurance

Student loans

groceries

restaurants/coffee shops

gifts

Education expenses

Phone

Internet/TV

 

And we have a few other categories I'm not remembering at the moment. I set our anticipated income and budget amounts for each category. A tip, set it slightly ($10) higher than you think if you're like me and don't like seeing red on budgets. :-) I set the car/home insurance category to $250 and it's exactly $250/month and my budget monitor goes red every month. I upped it to $260 and it doesn't do that anymore. 

 

I find that when I use mint consistently I stay under my grocery and restaurant budgets and when I forget about it for a bit, my grocery spending goes through the roof. 

[kbutton]

I am not sure how you currently pay for things, but go back through credit card statements, etc. and just see what's on them. Use your checkbook/online bill pay ledger and receipts if you've kept any. Make your categories from there. We tend to have expense-heavy portions of the year but a steady income. We ended up setting up several bank accounts. One account has the mortgage (plus taxes and insurance--no escrow for us), typical household upkeep (plumber, etc.). It has a slight bit of padding, so if we don't have any major upgrades or disasters, we can save up and pay for things like a new paint job for bedrooms or a shed for the backyard. We are currently hoping to do a remodel and maybe addition, so we've started adding money to this account just to see if we miss it or not (plus it will help pay for it down the road). We have one account for those once per year big expenses such as Christmas, vacation, half a beef cow, yearly life insurance and disability insurance premiums, car insurance premiums, etc. (we pay insurance premiums yearly because it's a sizable savings when you put them all together). To set that account up, we put a bit of padding in it during a slow time for bills, and then we divided up our yearly expenses in those categories by the number of paychecks per year for direct deposit. We also have an account for everything that's leftover when we've paid bills, and we try our best to leave it totally alone. When it gets big enough, and things get stable, we use it for things like our next car (we've been able to buy used with cash so far, but if we couldn't do that, it would be for a down payment on a nice used car). We have an emergency account that we don't touch (it's in a slow growing fund recommended by our financial advisor). We look at retirement funding year by year. We also have a health savings account--if we didn't have that, we'd have to be much more careful about medical stuff, but in prior years, we let it grow so that we'd have extra money in there as well.

 

We were not really able to look at budgeting until we look at expenses for the whole year. Through a combination of several circumstances, we have a really "cheap" portion of the year and a really "pricey" portion of the year. Part of the year, we look like we have a lot more extra income than we do.

[Hilltopmom]

Good idea on looking at statements, our credit card sends a yearly recap & I charge (but pay off monthly) a majority of our expenses, since I rarely carry cash.

 

I don't do online banking, but

I really should:)

Edited March 23, 2016 by Hilltopmom