HOW TO BUDGET | Budgeting Tips & Spreadsheet

I’m going to show you how to budget along with some budgeting tips and in actual spreadsheets so the reason I chose to talk about how to budget is because it is so important to budget your money so you actually know what’s coming in and what’s going out every successful business on this planet has a budget and they know exactly what their income and expenses are and how much they’re gonna have left over at the end of every month obviously no one has a crystal ball but in my opinion what you measure gets tracked and what gets tracked can get optimized so let’s get right into it you guys so very simply the spreadsheet that I’m going to use is just a Google Chrome template so what you want to do is if you have a gmail account or any Google type of account you just click on those nine square dots in the top right hand corner click on drive and once you click on drive it’ll take you into this screen so you simply just click on the plus number here Google sheets let it expand and click from a template okay from there it’ll take you to this screen right here and you’ll see a monthly budget calculator so what I’m gonna do is I’m gonna open up a monthly budget sheet right here that we already started editing and I’m going to go over this spreadsheet and exactly how this will change your financial life so follow me if you can you guys this is very simple

so what you want to do is any

highlighted field is a field that’s going to be edited okay or that you have the ability to edit the rest of these fields are actually just showing you what your actual numbers were and the difference total for this month okay so this is a monthly budget meaning that we’re gonna say exactly how much we started the month with so I’m going to use easy numbers and say this month we started with $1,000 right now what we’re able to do is in this tab down here next to summary we actually have a

transactions tab okay so this

transactions tab is actually what populates all these fields that you see here and you can always add and remove columns but I just chose to leave the ones that

Google gave in this template because they pretty much cover what everyone has an expense as an expense and also what everyone has is an income okay so you following me so far you guys let’s get right into it so the nice thing about this is that this gives you your planned and actual expenses for the month and your planned and actual income for the month and then it shows you the

difference between your starting balance and your ending balance and also the percentage of the total savings that you’ve had and also the actual dollar amount so what I’m gonna do here is I’m only going to populate the paycheck tab just because we’ll keep it nice and simple and so this video is quick and that everyone can follow it if you want to go into more detail all you need to do is follow me on this one and just repopulate it for all the other

categories so let’s say we get a job that pays us every two weeks so right now we know that we’re getting paid every other Friday so let’s see that you know total we’re getting paid five thousand dollars in a month okay so we can see here that our planned income is five thousand dollars so far we haven’t realized any of that because I did not populate it in the transactions tab but the difference is showing negative five thousand so let’s let’s reconcile that it’s very simple so let’s say it’s the first of March 2019 so this video is from the future and I’m taking a time machine to come record it for you guys so we said that we make about twenty five hundred dollars every couple of weeks so I’m gonna put twenty five hundred dollars for my one paycheck the description is going to be Paycheck or it can be whatever you want to call it but the category is how the spreadsheet knows how to categorize it right so I’m gonna put this under paycheck now if we go back to the summary screen we can see here that our actual number is twenty five hundred because we got our one paycheck for twenty five hundred which you can see here and now the spreadsheet tracks that okay now let’s pretend it’s the end of the month okay or it’s the 15th because we get paid every couple weeks right I get paid the same amount so I put in twenty five hundred dollars I’m gonna call this paycheck again I’m going to categorize this under

paycheck and now see what happens boom so we plan on making five grand we actually realize five grand and we’re on track with our income budget right and the nice thing is that this changes in real time so you can see here that we plan five grand we realize five grand our starting balance is 1,000 our ending balance is 6,000 and it’s saying that we save this much money this month just because I haven’t put in any expenses yet makes sense now here’s the fun part okay this is where you really need to realize and actually understand how much money is coming in versus how much money is going out an easy way to do this is to check your credit card statements to understand an idea of how much per category you spend per month so if you’re going out to eat and you know you spend $10 everyday on lunch you know that you’re gonna be probably in the neighborhood of three hundred dollars per month just on eating out right so a good way to do that again is to check your credit card statements check your bank statements and also write down any transactions you may do in cash that way you know exactly how much money is going out to each category right so let’s go through a real quick example so food let’s say you’re that person that spends $10 a day everyday on lunch and then some on the weekends so you know that you’re gonna spend about $350 that month right say you’re a generous person and you give away $150 a month

in gifts whether it’s to your little niece or your grandkid or whatever your life situation may be health and medical you know knock on wood we’re gonna be pretty healthy here and we only plan on spending 50 bucks a month on the home this category is typically gonna be like your rent so if your rent is 1250 a month you put that in there and anything that goes along with the home such as you know repairs and things like that you can throw under home or you can choose to categorize that under other or you can even make a custom category down here which is nice you simply just edit it and call it you know additional expenses right and that could be you know a catch-all transportation I typically consider this anything that costs money to get you from point eight point B so if it’s putting gas in your car and you know you spent 40 bucks a week on gas there’s roughly four weeks in a month you do forty times four okay I expect to spend right around 160 bucks this month on gas personal this could be anything this could be something for entertainment this could be something for you know that you need around the house it could be a Keurig you know it’s pretty much all encompassing for

personal items I don’t buy that much stuff every month so let’s just put 150 pets this is obviously if you have a pet so you want to take into consideration any veterinarian bills ongoing expenses like grooming food you know things like that typically what I do in a situation like this is that I take all my bills that I know the pet is gonna have over the year and I divide it by 12 and that way I get a monthly amount so if you have veterinarian bills and things that may come up let’s just budget right around 200 bucks a month for the pet right utilities let’s just say we live in a 2,500 square foot house you know water sewer gas electric you know whatever

let’s put 250 bucks here Travel I know that I want to travel on a really nice vacation once a year so I’m gonna save about $200 a month which is about $2,400 a year any debt so this this means interest that you have to pay from that debt so if you have student loans and things like that you want to put them up the amount of interest here so hopefully no one is in debt so I’ll just leave this at zero other this can be you know whatever you want it to be right so let’s just put an all-encompassing $300 here so we know that we’re planning about three thousand and sixty dollars a month for our monthly expenses and we know that we’re planning on receiving net five grand a month right and again you guys this is just an example so now you do the same exact thing as you did for your income so when we’re putting in our paychecks right here you do the same exact thing for expenses so if we know that our rent or our mortgage is gonna be 1250 a month we simply put that here you know the date we incurred it let’s say we owe rent on the first the month we paid 1250 we put it under the

category of home and boom look you got the

right here so you have 1250 1250 the difference being zero okay so now what is for the sake of time I would go through all the other categories or pretty much as anything any expense that I incur throughout the month I put this here so let’s say it’s the next day and I want to go to the movies and I put you know $10 I’m going by myself

right and I’ll put movies so under this category we can either put this you know under personal other however you want to classify it or you again you can even create an entertainment category I’m just gonna put this under personal and now you see I budgeted 150 I actually paid out 10 so far and that’s a

difference of being plus 140 does that make sense

but now let’s let’s take an example of where we go over budget right let’s say it’s the next day and I want to buy a $600 iPad right so I buy an iPad I categorized this under the personal expense and now look what happens boom I smoked my budget for the I by buying that iPad okay so I budgeted 150 I actually have 6/10 so 600 for the iPad $10 for the movie

I’m already over my budget by $460 and it’s only the third of the month right so you do this throughout the entire month so remember everything that you spend you want to track here not only is it excellent for holding you accountable and knowing that you have this

spreadsheet tracking everything you do to see if you’re actually falling within your budget it actually shows you where you’re spending most of your money on so if you go into this actual category right here you know that okay my my rent is my rent you know I paid that it’s great my difference is zero and then you look over here and you say holy smokes for 60 what’s going on here

oh it’s because I went back in here and I I bought the iPad I bought the movie I did this I did that and you can actually see where most of your money is going so hopefully you guys found this pretty powerful again all you need is a Google Drive account to be able to change your entire financial life so why wouldn’t you want to do that so knowing how to budget is extremely important because I’m as I mentioned in the beginning of this video it helps you act like a business it treats your purse

finances like a business you know exactly how much is coming in and you have a very good idea of how much is going out per month which allows you to realistically budget and it allows you to allocate every single one of your dollars into investments or assets that’ll help you actually build your wealth over time so thank you so much for watching you guys I really hope you got value out of this video please like this video and please leave a positive comment it really helps YouTube

recognize my channel and actually helps me become an authority on actually knowing what I’m talking about so ultimately share the video with a friend who needs that budget we all have that friend that’s driving a brand new car has a Louis Vuitton belt looks like a million bucks and is freaking broke so send them the spreadsheet actually don’t spread send them to spreadsheets they probably won’t talk to you again because those kinds of people don’t want to be hit in the face with reality but again the numbers don’t lie so knowing how to budget will absolutely change your financial life thank you so much and have a prosperous days.

More to read