Welcome to my 6 part series on creating a family budget. You can read the entire series or use the handy links below to navigating to a particular lesson. Thanks for reading Trees Full of Money! If you haven’t already done so, please consider subscribing to my free email newsletter or RSS Feed.
Table of Contents:
- Part 1: Introduction: Why You Need a Budget
- Part 2: Budget Spreadsheet: Download My Free Budget Spreadsheet
- Part 3: Step by Step Instructions for My Budget Spreadsheet
- Part 4: Tips for Reducing Your Monthly Expenses
- Part 5: Tips for Increasing Your Income
- Part 6: The Envelope System of Budgeting
In the last two articles I showed you how to download my free Excel based budget spreadsheet and how to set up your first budget using my system.
If you haven’t been around the last few days, and you’re interested in learning about my budgeting techniques, you can get caught up on all you need to know by starting here.
If you have been following along, print off a copy of the “rough draft” budget you typed into my budget worksheet in yesterday’s lesson.
Is there anything on the worksheet that “jumps” out at you? Are there any categories that make you think “holly smokes, I’m spending $700 per month groceries and eating out”?
Tips On Cutting Your Budgeted Expenses:
As I mentioned in a previous article, the most effective budgets evolve over time! If budgeting were an easy task, everybody would be rich!
Evaluate each spending category on your printed worksheet as you work your way through your budget. Highlight the areas where you feel you can possibly reduce your expenses. The following examples explain how my family and I were able to reduce our monthly expenses by hundreds of dollars per month.
Tips for Saving on Your Electricity Bill: Though careful research, my family and I were able to significantly reduce the amount of money we spend on electricity each month. I have assembled some of the best energy saving tips in my article 36 ways to reduce your home’s energy use.
Tips for Saving on Your Gas and Heating Oil Bill: Following my energy saving tips mentioned above will also help you save money on your heating oil and/or gas bill. Additionally, I’ve written extensively on how to take advantage of pre-buying oil and gas contracts.
Tips for Saving on Your Grocery Bill: I am horribly inefficient when it comes to purchasing groceries. Even while we were rapidly paying off our non-mortgage consumer debt my family and I were still spending a disproportionate amount of money on groceries and eating out. Thankfully we have developed a plan to spend less money in the grocery store and I am very optimistic that our new plan will work!
Tips for Saving Money on Gas: Check out my great list of easy ways to increase your car’s gas mileage and save money at the pump!
Tips for Saving on Your Cable Bill: One of the easiest ways to save money is to cut out all non-essential utilities from your life. If you’re barely getting by and face a large amount of debt, you should strongly consider dropping cable, high speed Internet, and other “non-essential” services.
One thing I did discover is that cable TV and satelitte companies will often extend promotional rates to regular customers. One time I called up my cable company to cancel our high-speed Internet service (it was a package deal with cable). When they asked me why I was canceling, I told them dial up service would be more than adequate for my needs and would only cost me $10 a month instead of the $44 they were charging me.
To keep me as a customer, they offered me their current promotion of “free high speed Internet service for 6 months”. I gladly excepted their offer, especially since I couldn’t even get dial up Internet because I had already canceled my landline phone service!
Tips for Saving Money on Toilitries and Other Everyday Items: If you know how to shop right, you can save a tremendous amount of money on everyday personal items (soap, deodorant, toothpaste, mouthwash, shampoo, etc.). Perhaps the best way to save money on these items is by utilizing a technique know as “The Drugstore Game”. I first read about the Drug Store Game on the blog Get Rich Slowly. The article was actually a guest post by Cathy of Chief Family Officer fame:
The Drugstore Game involves combining manufacturer and store coupons, and taking advantage of a store’s best deals. When played at the highest level, the Drugstore Game requires only a couple of dollars out of pocket each week to keep you and your family stocked on necessities like toiletries, paper goods and even groceries. –Cathy, Chief Family Officer.
If you’re interested in saving money on everyday items, I urge you to read this article!
Tips for Saving Money on Childcare and Baby Sitter Expenses: One of the best methods I’ve seen young families utilize to save money is to swap baby sitting time with other families. Several families in my area take turns watching each others kids allowing each family time to run errands, organize the home, attend doctor’s visits, etc.
After crunching the numbers, my wife and I decided that having one of us stay at home with our young daughter wasn’t as far fetched as it initially seemed. If you’re on the fence on becoming a single income household, I recommend that you read this article.
Place Your Family Budget Into Action:
After making an honest assessment of your budget and identifying any areas where you may be able to reduce your expenses, its time to put your budget into action!
I can assure you that over the first few months, you are going to make many changes to your budget worksheet. You’ll find that you actually spend much less on some budgeted items, while you spend much more on others!
The ultimate goal is to maximize the surplus you have at the end of the month so that the money can be utilized in other areas of your financial life. When it comes down to it, the only way to do this is to develop a workable budget (which you are now well on your way to doing), OR increase how much money you make!
Tomorrow we will go beyond my budgeting techniques to look at ways to increase your monthly take home pay! See you then!
THANKS for reading my personal finance blog! You can learn more about my site here or you can jump right into the juicy stuff by reading my family's own detailed debt free success story (which has formed the foundation of this site). Please consider signing up for my free email updates!