I have read so many articles on how to do a personal budget, and I’ve learned a lot of great (and not so great) tips on how to do it. I’ve written about how I actually do my own budget, because I don’t want to waste your time with a system or tips that are too time consuming to actually use. So here’s how I budget my money!
Slight disclaimer: This budget is my personal budget, and does not include tuition. But this is a great guide for how to organize your spending money.
How Much Do You Spend?
I actually didn’t know how much I spent when I set out to make a budget. So I chose one month where I would put my money on checking account, and only use my debit card for purchases. This way, I could check the transaction history and I’d have a convenient log of everything I bought that month. If I had to use cash, I would write it down separately. At the end of the month, I added together how much I spent on gas, groceries, entertainment and whatever else, and figured out if that was a reasonable amount. My car gets okay mileage and my internship isn’t far away for me, so I only spend about $100 on gas a month. But when I realized I was spending too much on food, I was able to scale it back to a more reasonable budget.
What About The Next Month?
I like the debit card system, because the writing-every-single-purchase down was too much even for an organized person like me. At the beginning of the month I chose how much I would spend on the following categories:
Shopping (thrift stores are my weakness)
Car "Just In Case" (JIC)
Since I live at home in the summers, I don’t pay rent (thanks Mom) and my grocery budget is smaller because I cook with my family. The Car JIC is because I have a car from 1999, and sometimes it needs to be fixed. If I budget monthly for it and don’t need it, I’m basically saving for when it needs a $400 ignition coil replaced. The emergency is really any weird cost I may need and can’t predict: it’s been used for medicine during a cold, birthday gifts or a really good deal online. My entertainment is larger because I have a boyfriend, but we typically switch off who pays for dates or dinners. So I’ll pay one night and he’ll pay the next, so it basically evens out.
How Do You Afford It?
I work a few jobs, and I am lucky that I have some savings in case I need them for a real emergency. I looked at my debit card (I love that thing) and I could see how much I earned in one month from each of my jobs. I added it up, and could see exactly how much I made after taxes. Since my hours were regular at my jobs, I could count on that amount every month. I also like to always budget to spend less than I make, as a cushion for if any categories go over budget, and so I can hopefully add the extra in the ‘Savings’ category.
Typically I’ll aim to do a check-in on myself halfway through the month, so I can see if I’m on-track or overspending. I always try to come in under-budget because I’m basically paying myself for a job well done with any extra I save during the month.
I hope you can utilize the system I use. I’ve found it to be very helpful, and I really like using my debit card to keep track of spending without my needing to write everything down.
Feel free to comment any tips of your own or if you have any questions!
Hi, I'm Riley! I graduated from college in December 2016, after working to earn over $100,000 in scholarships and aid.