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The Easy Budget Tool

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Some people think the word “BUDGET” is a four-letter word.  Simply saying the word sends shivers down the backs of couples as they imagine the slugfests that will ensue.  Many young people aren’t scared of the word, but they just believe that budgets are too much work and something they can start later.  The truth is that doing a monthly budget is a necessary process where you free up your money and minimize the guilt of spending, which I enjoy… a lot!Budget Tool Quote

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My wife and I started doing a budget at the beginning of 2014 and it helped us cut back our spending and pay off almost all debt by the end of the year.  We were even able to finally finish our emergency fund!  All of this happened without feeling like we sacrificed anything!  In many ways, it actually allowed us to feel better about spending instead of always feeling the guilt of buying something and not knowing if you really had the money for it.

If you are ready to take control of your money with an awesome budget tool, keep reading!

We tried many different pieces of software and websites to handle the budgeting for us, but could not find anything that broke out the expenses the way we needed and easily showed where we stood by category.  Many of the programs were restrictive while still being a manual process to enter.  Others did it automatically, but put every Target receipt as groceries instead of allowing us to easily separate the expense into the appropriate categories.  So, being the problem solver I am, I created an Excel spreadsheet that allows me to track expenses and set a monthly detailed budget.

There is a budget tab and a checkbook tab for each month to track your progress through the year.  The checkbook tab is an updated and easy version of the old school checkbook ledger used to track expenses.  The ease of online banking has made this a flawless process that only takes 5 MINUTES A WEEK!

The 7 benefits of budgeting

  1. Where did my money go?  Chances are you don’t realize how much you spend on fast food or Starbucks or convenient store candy stands or….. you name it.  My surprise was how much we were spending on groceries each month.  This easy budget tool allows you to just enter the expenses in one section and then you automatically see where all of your money is going.
  2. Cut the crap!  After you figure out where your money is going, you will start being more cognizant of how you are spending.  You won’t be forced to pinch pennies, but you will subconsciously question buying something that has no value or you realized you are spending too much on.
  3. Turn money into a fun subject instead of an argument.  A scary stat from Utah State University (found here) states that couples that fight about money weekly have a 30%-40% increased chance of divorce.  That number increases by 125%+ if it is a daily argument.  The problem usually comes from one person dictating how the money should be spent for the couple or neither person in the relationship watching it at all.  My wife and I started sitting down each month to create the budget together.  We go through each category we created (you can modify the detailed budget to create your own categories) and agree on a dollar amount we are allocating to it.  Then, it is almost a game to track and stay under the budget.  The reward is usually more money in savings and even better…… more to spend on experiences and items we really enjoy!
  4. Budgets mean spending more!  Going through the budget, always over estimate what you think you will spend in each category unless it is a fixed expense.  Any funds that you have left will go to savings and spending!  Heavy up on a certain category each month and have fun.  And since you put it in the budget, the spending is 100% guilt free.
  5. Saving for opportunity.  I still call it my emergency savings (thanks Dave Ramsey!), but I really think of this savings fund as my opportunity fund.  After I have enough to survive three months in an emergency, then the rest of the fund can be used for true opportunities.  I try to keep six months of living expenses in this account, which means I have three months that I can spend on business or learning opportunities.  The budget has a tool for you to track what you need to survive so you can create your own emergency savings.
  6. Progress is the best motivation.  By doing a monthly budget and tracking expenses against it, you will be able to see the progress as the year goes on.  If you only save a few hundred or even just a few dollars a month, it will add up over time.  Looking back to where you started after a few months will be very motivating since you can clearly see the trend.
  7. Did I fall victim to the Joneses?  This is something I talk about in my 6 Success Mental Makeover post last week.  We all have the tendency to compare ourselves to others and try to keep up.  If you are doing the monthly budget and can’t reduce your expenses enough to be covered by your income, then you have fallen victim to the Joneses.  If that is the case, you need to take drastic action now.  Going further into debt waiting on your income to catch up is a strategy that will likely lead to bankruptcy.  As your income increases, it is human nature to increase your lifestyle which means your expenses also increase accordingly.

Are you still reading this?  If so, you realize the importance of the budget.  Enter your name and email above to receive your free MyDailyMark budget tool.  I will send you the detailed version that I use each month.  Given that different people want different things from a budget, I am providing a few additional resources for you:

  • Is it more than you want?  If you are wanting to do a budget, but the detailed version is bit more than you want, I have provided a simple version of it here: MyDailyMark Basic Budget
  • If you are ready to create an awesome budget, but need help!  Visit this page to get more detailed how to videos on operating this budget and how I manage my expenses weekly.  More Detail
  • Like the idea of a budget but want to see the alternatives?  No problem! I found that my budget tool was more effective for me, but everyone is different.  The most important piece from this post is that budgets are important and you need to find what works for you.  Here are a few other budgets I have used with some success in the past:
    •– Detailed breakout of all accounts that stays up to date automatically and tracks some expenses.
    • Quicken Software– Commonly accepted as one of the best budget software systems with a lot of features.  Can be difficult to learn at first and costs $40-$70.
    • Dave Ramsey– He has some powerful budget tools on his website and even better advice in his books and podcast.  If you are looking to get out of debt, he has some realistic and powerful advice for you!
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