Part of running your household includes keeping track of your money…both what comes in and what goes out. When you know that you have enough to cover all your living expenses and are able to put something away for a rainy day, you are less stressed and more confident in your spending.
So what are some good ways to keep track of your household budget? It really depends on your personality and whether or not you are a paper kind of girl or prefer digital tools.
How do I manage my household budget?
First and foremost, before you start crunching any numbers, you need to find out if you and your spouse are on the same page in terms of where your money should be spent.
For example, you may love going out to eat and think that allocating a large amount of your budget would be a good idea. But if your husband prefers to eat at home more often so that you can put more money into your retirement plan, then you’re going to have some negotiating to do.
You’ll also want to talk about any goals that you might have that require money. For example, I desperately want to get a new living room set. Our old one is rather worn, and you sort of sink down into the couch when you sit, rather like falling into a pit. My husband, however, is concerned that our oldest car isn’t going to last much longer, so he would like to save up for a new-to-us car.
Working together to prioritize our goals helps us not feel resentful of each other and to be more fully aware of where our money is going.
What are your household budget priorities?
When making your budget, you need to put all of your important living expenses at the top of the list. This would include things like your mortgage payment, food costs, utilities and so on.
After you make sure all your living expenses are covered, then you can start adding in any savings that you want to do, and any debt payments that you make each month.
Lastly, you can divide any extra money into categories for fun or saving for big projects that you want to do, like a new car or that new couch you want.
How do you keep track of your spending?
Keeping track of your spending is an important part of making sure that your budget is working. After all, you wouldn’t want to spend your month’s worth of grocery money on something else and then leave your family short of food money.
If you like paper systems and being able to see the big picture all on one piece of paper, you can use this free household budget form to record all your income and expenses for the month.
While I’m a big fan of pencil and paper, sometimes I feel like using it for a budget is cumbersome, because if any changes need to be made, you have to go erase and re-add all the figures.
Spreadsheets are useful for making budgets. This handy Excel spreadsheet from Frugal Family Home is perfect for keeping track of your household budget.
Even though at heart, I’m a paper girl (love my paper planner!), I like using budget software, specifically the EveryDollar software from Ramsey Solutions.
EveryDollar is free to use, and it’s really easy to make a budget and keep track of all your transactions. I can access it from my laptop or my phone so that I know exactly where we are in terms of spending at all times.
There are several other budgeting software programs available, such as Quicken, YNAB and Mint. Find the one that you are most likely to stick with and use it monthly.
For expenses like groceries and even clothes, it’s a good idea to use cash because it gives you a limit on what you can spend, so you don’t make impulse purchases that you can’t really afford.
Keeping track of your household budget is really a necessary part of taking care of your family. Even though it’s a bit of a chore, your family will be much better off in the long run by investing time in financial goal setting and budgeting.
For more household budget tips, you’ll want to read these smart spending habits for the stay-at-home mom 🙂