How to make a budget and monthly budget templates (2024)

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There are many benefits to creating a budget. It can help you get out of credit card debt, build an emergency fund or even save to buy a house. Even if you feel satisfied with your financial reality, creating a budget can help you feel more in control of your personal finances. One of the easiest ways to start is by using a template. In this post, we’ll walk you through utilizing a simple and detailed budgeting template.

Simple budgeting plan template

Detailed budgeting plan template

• Step 1: Add up your monthly income
• Step 2: Identify and categorize your expenses
• Step 3: Get clear about your financial goals
• Step 4: Do the math and plan
• Step 5: Check in regularly and adjust
• What’s next: Reach financial goals

Step 1: Add up your monthly income

Start with your take-home pay, which is your total salary or earned wages minus taxes, withholdings for health care, wage garnishments and retirement contributions. If you have any other regular, dependable income, add it in.

If you work part-time, freelance, or otherwise have inconsistent income, starting with your expenses first might be helpful to determine how much you have to work to reach your financial goals.

What is disposable income?

Disposable income is the amount left over from your paycheck or other income after you’ve paid taxes.

Walkthrough: Adding income to your template

Start by clicking on the “Income Input” tab at the bottom of the spreadsheet. Here you’ll see the full list of income categories. This includes various income sources such as your regular paycheck, bonuses, etc. Fill out both the “ESTIMATED” and “ACTUAL” columns. Filling these columns out will automatically complete the “DIFFERENCE” column and show you a full picture of your income.

Step 2: Identify and categorize your expenses

When determining your expenses, you’ll want to categorize each item to know what you can adjust. You’ll probably know a lot of your regular expenses off the top of your head, but going through your bank account and credit card statements can help remind you of where else your money goes.

Start with your necessary fixed expenses — things like your mortgage, rent, utilities, car payments and other debt like credit cards or student loans.

These are considered fixed expenses because they’re unlikely to fluctuate, and reducing or eliminating them may be difficult or impossible.

Once you know your fixed expenses, you’ll need to determine your variable and “nice to have” expenses. Items like groceries, gas and entertainment are variable because they usually fluctuate from month to month and are areas where you may have some flexibility to cut back to save.

You can split expenses into needs (like groceries) and wants (like a gym membership).

Since some of your expenses will differ depending on the month, looking at up to six months worth can be helpful to get a sense of your average spending.

Walkthrough: Adding expenses to your template

Image: walkthrough-2

Next, click on the “Expense Input” tab at the bottom of the sheet. This tab is just to the right of the “Income Input” tab and clicking it should bring up a list of expense categories, including bills, transportation, entertainment and child-raising expenses.

Go through each category and fill out the “ESTIMATED” and “ACTUAL” sections. Again, the “DIFFERENCE” column will automatically populate.

Step 3: Get clear about your financial goals

Maybe your priority is to stop living from paycheck to paycheck and to have at least a few extra dollars to spare at the end of each month. Or maybe you’re ready to work toward bigger things like retirement or buying a home.

Think about your immediate goals and what you want to accomplish — and write them down.

It’s OK if your goals change over time. The important takeaway is that being specific about what you want to accomplish — and keeping those goals in mind — can help motivate you to stick with your budget.

Step 4: Do the math and plan

After entering your income, expenses and goals into your monthly budget spreadsheet, it’s time to take a step back and analyze your situation. How much money do you have left after covering your fixed and variable expenses at the end of the month? Ask yourself if it’s enough to save toward your goals.

If the answer is no, look for places where you can cut back and save money. Your “wants” category under variable expenses is the best place to start. Plan to cook more at home if you go out to eat a lot.

If you like going to the movies, try streaming at home. After identifying places to save, adjust the numbers in your budget template to see how it affects the bottom line.

If you still need room in your budget, you might have to adjust your fixed expenses by making major changes like moving to a less expensive living situation or refinancing your mortgage for a lower interest rate. You could also consider changing jobs or asking your current employer for a raise.

What is the 50/30/20 budget rule?

If you’re unsure how to plan your budget, you may enjoy trying the 50/30/20 budgeting rule. This rule simplifies budgeting by allocating 50% of your after-tax income to needs, 30% to wants and 20% to financial goals like savings or paying off debts.

Walkthrough: Understanding your budget summary

Once you’ve added all your income and expenses, click on the “Budget Summary” tab to the right of the “Expense Input” tab.

Your “Budget Summary” will automatically generate results based on the income and expenses you added to the budget worksheet. Here you’ll see a breakdown of your spending by category, your income vs. expenses and more.

Seeing your budget summary can also help you know if you have enough extra income to meet your financial goals or if you need to make changes.

Step 5: Check in regularly and adjust

Scheduling a regular budget check-in with yourself can help keep you accountable and on track. For example, consider taking 30 minutes at the same time each week to review your spending from the previous week and compare it with your projected spending for the month.

This will allow you to make any necessary adjustments each week if you’ve overspent on one item or another.

What’s next: Reach financial goals

Many Americans don’t have a budget or plan for their finances, but creating one can help you achieve your short- and long-term goals. It just takes a little time, a plan and your commitment to control your financial present and future.