Budgeting With A Printable Budget Planner

Image courtesy of Stuart Miles at FreeDigitalPhotos.net

Image courtesy of Stuart Miles at FreeDigitalPhotos.net

Did you know that you can get your spending under control in just 5 easy steps!?  It all starts with writing a spending plan (aka budget) that works and the right tools like a printable budget planner!

Why You Need a Budget

I know to some people “budget” is a four-letter-word but let me explain why it is a vital part of your efforts to build wealth. You see, money is like a child. It needs guidance, discipline, and love. If left to its own devices, money will act a fool, run amuck, and ultimately find its own way (out of your wallet)! You must tell your money what to do and when to do it and when you write and work a budget you are doing just that.

Important Properties of Budgeting

A budget is not something that you can set and forget. It takes time to develop a smart spending plan and it takes trial and error to get it just right. You may find yourself revising your budget as often as once month and that is okay as long as you are making an effort to get your spending under control. The key is to set some definite parameters in the beginning regarding approximately how much of your money you want to keep, how much you want to spend, and how much you want to give away.

I like the following guidelines for beginners: keep 20%, spend 70% and give away 10%. If you are starting your financial journey in debt those guidelines might not be realistic for you. Play with the numbers and decide what you can realistically live with. I do strongly advise that you aim to keep no less than 10% of your income.

*How to Write A Budget (In 5 Easy Steps)

Here I will explain in five easy steps how you can getting your spending under control to finally stop spending more than you make and start building the wealth you want! This process involves setting some parameters, prioritizing your needs and wants, using a printable budget planner that you can revise whenever you feel the urge, and learning how to put your spending plan on auto pilot.

Step #1.  Set Parameters for Your Spending Plan (Your Keep, Give, Spend Ratios)

  • Keep – I like to use the word keep instead of save because I want you to develop the mindset that the money you save will be yours to keep FOREVER. People often think about savings as something they can dip into when times get tough. Well I don’t play that! If you need some money then start yourself a nice, handy emergency fund. The money you keep is YOURS! It is not the bank’s, the credit card company’s, the grocery store’s, the shopping mall’s, Starbucks’…it is YOURS!!! To keep. Forever. Period.
  • Give – I believe we all have a responsibility to show our appreciation for life by giving to those who are less fortunate than we are. If you have been helped ever in life (and we all have) then you owe a debt to society to help someone else. I truly believe that charitable giving is good for your soul and the more you give the more you get! For charitable giving I also believe no less than 10% of your income is ideal. If you are in debt then I understand that you might want to get your own house in order before earmarking funds to your charitable giving account.
  • Spend – I think it goes without saying but I’m going to say it anyway…the less you spend the better off you will be financially! With this in mind, I want you to reduce your spending ratio as absolute, dead-low-down-to-the-ground as you can get it! That is all I’m going to say about that.

Ex. When I budget I like to work with my net earnings just because I like to keep things simple. So let’s look at an example where a person brings home $5,000 a month and they set a 10-10-80 plan (Keep 10%, Give 10%, Spend 80%). They would set the following guiding parameters in their monthly budget:

#Keep – 10% times $5,000 = $500
#Give – 10% times $5,000 = $500
#Spend – 80% times $5,000 = $4,000

Step #2. Make a Prioritized List of Your Expenses

Now that you know exactly how much money you have to waste spend on expenses (your spending ratio times your income) you can start prioritizing your expenses and making any necessary cuts. Remember the goal is to control your spending so that you spend less than you earn and you can build wealth for your future self.

Here is a list of typical expenses you might include in a monthly budget:

  • Debt (credit card bills, auto loan, personal loans)
  • Shelter (mortgage, rent, property taxes, repairs, hoa dues)
  • Transportation (gas, tires, maintenance, parking, DMV fees)
  • Food (groceries, fast food, coffee money)
  • Insurance (home owners, renters, auto)
  • Utilities (electricity, water, garbage, phone, cable, internet)
  • Household Needs (laundry detergent, cleaning supplies, toiletries)
  • Children (child care, activities, supplies, clothing)
  • Pets (food, medical, clothing)
  • Education (books, conferences, coaching)
  • Entertainment (vacations, outings)
  • Medical Expenses (co-pays, orthodontia)
  • Personal (hair cuts, salon services, clothes, gym memberships, subscriptions)

Step #3. Download a FREE Printable Budget Planner AND “Write” Your Budget!

Here are 7 budget planner templates and 2 bonuses you can try out (listed in no particular order):

1. Financial Snapshot & Budget @ Budgets Are Sexy

2. O.D. Deluxe Budget 2.0 @ Enemy of Debt

3. Free Budget Spreadsheet @ Money Under 30

4. Super Starter Budgeting Sheet @ Savvy Spreadsheets

5. Budget Template @ Gather Little By Little

6. Personal Budget @ Neil Rothman

7. Printable Monthly Budget Worksheet @ Freddie Mac

*Bonus: Early Retirement Spreadsheet @ Budgets Are Sexy

*Bonus: Debt Reduction Spreadsheet @ Vertex42

 Step #4. VERY IMPORTANT – Put Your Plan on Auto Pilot!!!

I am a huge fan of automation and developing fool-proof systems for success. There are many ways to put your spending plan on auto pilot and I am going to quickly list three options for you to consider.

(Option 1 – My Personal Favorite)

  • Open a Capital One 360 checking and savings account to use as your secondary bank.
  • Once inside Capital One 360’s website choose “External Links” to link your primary bank account (whatever account you are currently using).
  • After you have completed the process to link your primary account—select “Automatic Savings Plan” and click ADD.
  • Enter requested automatic savings information (amount to transfer, from account, to account, how often to transfer).
  • You can create as many automatic savings transactions as you need.
  • Set up automatic bill pay from your primary bank account according to your spending plan.

I like Capital One 360 for a few different reasons but the main reason I use and recommend this option is because this bank makes it incredibly easy to separate your savings and automate your finances. If you already have an account with them then I’m sure you know why I am such a huge fan.

Capital One 360 also has a really cool refer a friend program where if you open an account you can receive a $50 checking bonus and a $25 savings bonus and the friend who referred you will receive a $20 bonus for being a pal and hooking you up!

If you choose this option to automate your spending plan please click on my referral link here to open your account with at least $250 and I will get the $20 bonus. Once your account is open you will get your own referral link and you can be a pal to others!

Capital One 360

(Option 2)

  • Set up your automatic savings plan in your current bank according to your spending plan.
  • Set up automatic bill pay in your current bank according to your spending plan.

*Note: The reason I am a big advocate of opening a secondary bank account is because if the money is not readily available to you then you will be less likely to spend it. It is too tempting to simply transfer money over from your savings to your checking if you see it just sitting there. Again, I believe the best approach is to separate your forever money from your spending money.

(Option 3 – Can Be Used Alone Or Combination With Other 2 Options)

  • Sign up for automatic 401(k) or 403(b) deductions with your employer. If you know that you have a tiny problem with discipline and self-control then this might be the option for you as your savings will be deducted from each pay check automatically on a pre-tax basis. #foolproof

Step #5. Revise When Necessary

Your needs will change and so will your budget. Do not get discouraged if you find that you are not following your budget to the letter. Your budget is your spending plan and as we know, things do not always go according to plan. The most critical part of the budgeting process is staying within the parameters you set. If you spend more on food one month than your spending plan dictates…no big deal! If you spend $4,600 one month and the parameters that you set state you can only afford to spend $4,000 a month then that might be a big deal! That means either you robbed yourself (stole from your forever money) or you used credit (which is worse than stealing from yourself in my opinion).

Sometimes you will have months where you spend more than your monthly spending ratio (i.e. during the holidays). I handle that by budgeting a certain amount for gifts each month and having that amount sent automatically to my Capital One 360 savings account called “Gifts”. Too easy!

So if you are serious about controlling your money then I want you to set a day aside where you set your parameters, prioritize your expenses, select a printable budget planner that you like or build your own if you are in to that, automate your plan, and revise when needed. That is the simple formula for successful budgeting. Good luck on your journey!

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