Intro to Budgeting

Budgeting is such a broad term that when you're just getting started it can be intimidating. To sum it up: budgeting is just telling or knowing where your money is going and when. How you track this and decide what goes where is budgeting! You may already do this but there's always room for improvement. Before I started I have no idea how I was prepared for rent or bills every month.


I started searching all over pinterest and came across different techniques. I created a google sheet (spreadsheet) that was a long list of me tracking money in and money out (subtracting). I had each month, the far left being the date, middle an explanation of what it was for, next to that is the amount of that transaction and the right column being a running total. 

Long story short: It takes a few months to find out what works for you and there's tons of ways to budget but these are what I have found to work best for me!

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I would recommend your first month of budgeting to just track every single expense- groceries, coffee, meals, gas, rent, etc. 

Then, from there you can start to set limits for how much you will plan to spend on food, gas, electricity. (create however many groups you need.) Simply writing this down, or having a spreadsheet worked for me.
I had gas, allowance (for clothes or coffee), rent, utilities, credit debt, and groceries. Thinking it all through and deciding how much you have left over or need each month.


Along with this step you could even go as far as only taking out cash for the amount you can spend- thus limiting yourself to no impulse buys or really thinking about what you need to use that for.

Next step is to decide what your priorities are. Obviously home, water, food, gas, car and such come first. After all the necessities what comes next? Debt, saving goals, investing? That is where it comes to what your goals are.

I followed Dave Ramsey's (book and podcast) first 2 steps that were save $1,000 for emergencies and then throw any extra money at debt using the Debt Snowball Method (blog about that as well). It helped me a lot to have set money aside for emergencies and not try to do 5 different things at once, and it keeps you motivated! My next steps are now to save 3-6 months of expenses and I'm also saving for traveling. This is currently a "simple" budget that I give to my friends as a template to start! Just an idea of what mine looks like!

A few tips: 

having a separate savings account with a different bank than your checking. This makes it harder for you to transfer money over. I opened a Capital One 360 savings account and I loved being able to have multiple sub accounts for saving accounts with set goals and this also had a small interest (growth). This worked for me for about 2 years.
Now I recently opened a Simple checking account and it does something similar where you can have smaller goals that you put money in- but this one is just one checking account.

Lastly,

don't stop! Keep trying different strategies, simply being aware of where your money is going will make a HUGE difference and feel a lot better.  It took me at least 4-6 months to find what style of budgeting (google sheets tracking and debt snowball) worked best for me!