How to Set Up a Budget…Determine Monthly Spending

When setting up a budget you need accurate numbers. If you don’t have accurate numbers your budget will be a burden instead of a help. Today we start the process of determining your actual monthly spending.

Knowing how much you are spending beyond your monthly bills is a must for an accurate budget. So it's time to gather up all of those receipts.

So far in this series we have covered the importance of a budget, how to determine your monthly bills and now today we will be working on spending beyond the monthly bills.

Think of all the things you spend money on each month beyond the bills you pay.

This may be money spent as cash or on your debit card.

Don’t include the spending on your credit card, that amount is covered in your monthly bills and later in the series we’ll talk about credit cards separately.

Ideas to Get Started

Here’s a few items people often spend money on each month, just to get you started.

Groceries, hey you gotta eat.
Dining Out
Entertainment, things like movies, going on outing, kids activities, family activities
Car Maintenance
Gas for the Car
Household Items
Spending Money

Pretty much anything you need to purchase outside of your regular bills will be include in this section of the budget.

Calculating Spending Accurately

When you don’t keep track of how much you spend, it’s easy to underestimate how much is really going out. I think it’s just a tendency most of us have.

I know when we didn’t have a budget, I never realized how much money we spent on eating out. Wow, that was a big shock so many years ago when we finally did make a written budget.

To determine your spending on everyday things, I would like you to save every receipt for a month. Or gather up as many receipts are you can from the last month to get an accurate idea of how much you are spending in each area.

If you use your debit card instead of cash, you can look over you spending from last month.

If you use cash and a debit card, you’ll need to save your receipts from this month or at least a couple of weeks to get an idea of your spending habits.

Knowing how much you are spending beyond your monthly bills is a must for an accurate budget. So it's time to gather up all of those receipts.

As you are gathering receipts for a month, don’t change your spending. We want to know your usual spending patterns, so you don’t end up with a budget that too strict.

Just start collecting receipts when you purchase.

If you purchase a cup of coffee keep the receipt. If you go to the movies keep the receipt. Collect all of those receipts in a basket or envelope.

At the end of the month you’ll be able to figure out how much you spend a month on groceries, out to dinner, entertainment, clothing or what ever you do.

Just for Fun…

For fun you may want to guesstimate how much you are spending in each category. You may be surprised at how much or how little, you spend in a month on certain things.

Gather up those receipts and when you have them ready come back to this series and we will continue on.

This is really an important step to setting up a budget you can live with. While it can be tempting to just estimate what you are spending and move on. Don’t.

Gather those receipts or look over your bank records from last month so you’ll know how much you are really spending.

It will make a big difference in making an accurate budget you can live with. Really it will.

Have you missed any posts in this series? You can find links to all of them on the budgeting page.

Want to see more money saving related ideas? Click Here!

6 thoughts on “How to Set Up a Budget…Determine Monthly Spending”

    1. We set up a spending file for our household spending and that one seems to fluctuate the most. Some months we spend very little other months we end up spending more. We now have a little buffer of money in that category, so it does make it easier to stick to the budgeted amount.

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