Or maybe your numbers are higher, and you don't need to worry about anything under $250 or $500. Maybe you're on a tight budget and need to track down to $50 per category. How many categories do you really need? The fewer the better.įor example, when I look at my categories, if we aren't spending at least $100 per month in each category, I tend to lump it into a larger category. Regardless of why and how you budget, keep it simple. But I do like to know how much our cars are costing us, so it's worth my time to track car-related expenses separately. I'm not likely to spend $100 at the post office any time soon, so that's fine to lump that expense into a larger category. Since I want to track how much our car costs us - above and beyond periodic repairs - I created a separate category for car-related expenses.įor me, it always comes back to the reason I'm budgeting - to control spending.
#Budgeting you need a budget registration
But it includes the small fees - registration fees, state inspection fees, license fees, emissions inspection fees, etc. It doesn't include major repairs, which I'd put as part of a rainy day fund. I never do.įor the car registration fee, I have an overarching category for car expenses. If I ever need to look deeper into exactly what went into that category, I can. So I have a generic fees category that they all get tossed into. I don't need to track all these fees individually to achieve the goals I've set for our budget. And we pay $25 a year for our dog's pet license fee. As an attorney, I have fees related to my law practice. Instead, I just have a general fees category that covers everything from car registration to postage. Do I want a separate car registration fee category? I could take that approach, but it would further complicate my budget. How do I deal with that expense in the budget? It's not an insignificant expense, but it's only going to come up once every two years. It was $134 for each year, so I spent over $260 to renew the license plate on my Camry for two years. So this expense only comes up every two years.
In Virginia, you can renew two years at a time.
I need to have a good idea of where I stand in the middle of the month, as I make spending decisions.įor example, how do you budget for one-off expenses? That question came up for me this weekend. For me, it's not good enough to review my budget once a month. And I also need to know exactly how much money I have available to spend. So I need to have enough details in the budget that allow me to control spending. I do need to have a good enough idea of where our money is going. To do that, I need to understand, to a point, where our money is going. For my family - and I think for most people - a budget is a way to control spending. If you understand that, you'll have built-in answers to many of the questions that come up during the budgeting process.įor example, how many categories should you track? Which expenses are most important for you to track? Which tools, if any, should you use - YNAB,, Quicken, Excel, or an old-fashioned pencil and paper?īefore you can answer these questions, you need to consider why you're on a budget in the first place. You have to understand why you're budgeting in the first place. This is probably the most important tip I can give you. (If you get to the end of the list and have other great tips for budgeting like a Zen master, shoot me an email to let me know.) 1. So with that in mind, I want to share with you these 7 tips that guide my approach to budgeting. They do diminish the headaches that can come with trying to track every dime you spend. These shortcuts do not diminish the effectiveness of our budget. In the process, I realized that there are certain shortcuts I take with our budget. In fact, I had to reset YNAB and start from scratch. It had been several months since I looked at our budget. I want to control our spending so that there are no surprises at the end of the month. I’ve been very focused on budgeting lately. This weekend I fired up my copy of YNAB (You Need a Budget). Sometimes I'll go months without a formal budget, and I always wind up regretting it. I tend to go hot and cold with budgeting. Recently, this has been at the forefront of my mind as I've worked to refocus our family budget.
#Budgeting you need a budget how to
How can you budget like a Zen master without tracking every dime you spend? How do you budget for those oddball expenses that pop up from time to time? As someone who goes in budgeting spurts, I’ve learned the hard way how to make our budget work. This content has not been provided by, reviewed, approved or endorsed by any advertiser, unless otherwise noted below. We may, however, receive compensation from the issuers of some products mentioned in this article. You can trust the integrity of our balanced, independent financial advice.