Budgeting for Beginners

By | June 29, 2018

Do you want to start a budget, but just don’t know where to start? Everyone has to start somewhere, so let’s start with the basics! In this post, we will go over budgeting for beginners. Here are some tips to help you formulate a simple family budget.


The first place to start in the outline of your budget is with your income. Try to calculate your income based on your pay, or make a good estimate. Simply take a look at your net income over the last three months and estimate an average monthly income. If your income changes very little month-to-month, it should be pretty easy to figure out your monthly income.


Your next category should be expenses. Separate your expenses into general categories such as groceries and entertainment. Initially, you may estimate how much you spend each month in each category.

As you break down your expenses into understandable categories and numbers, remember that charitable giving or any giving away of money should be also listed as an expenditure.

Actual Expenses

Estimation gives way to “real” numbers when you write down your actual expenses during the month. This is the last section of your budget plan. Keep a running tally of your expenses for several months, and then look at where you are.

You can do this by visiting your online banking account often and writing down this information in a notebook, or using budget software. Some programs we recommend are:

Some Basic Principles

When creating a budget, you must distinguish between wants and needs. This can be very difficult, but it’s vital for a budget to function properly. Beware of convincing yourself that a want is a need when it isn’t – you may just be trying to find an excuse to buy the item. Real needs are things like clothes, food, and shelter; but designer clothes, gourmet food, and a palatial dwelling are more like wants!

Make sure your expenses do not exceed income. You may find yourself surprised the first time you do a budget and discover that you actually don’t make enough money to cover your expenses. If you discover this, you need to look carefully at your income section and see where you can increase it, and look just as carefully at the expenses and see where you can make cuts.

Once you make a budget, it is most important to set limits and stick to them. Sticking to your limits and recognizing your income vs. your expenses is very important and can ensure the success of your budget. If you apply these basic principles. you will be well on your way to saving money. I hope this budgeting for beginners tips help you start a budget so you can start saving today!