Creating a budget can be difficult, but it shouldn’t have to be.

Knowing your finances and being aware of your money and where it is going is essential in life.

You need to take control over your cash, or else your life can be ruined by it.

If you spend more than you make, you end up in the negative and the debt just piles on.

When this happens, it means that your debt to income ratio is way off. It’s a horrible place to be (trust me.) Remember when we first got out of the Army life and struggles just began? 

Budgeting saved our behinds that month, and every month thereafter.

The only way out of the debt hole, at that point, is to take back the reins and tell that money where to go.

It could be as simple as you needing more income to accommodate the spending, or maybe you need to trim off a little excessive shopping. This is what a written budget helps us to learn and determine.

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Of course, to find this out, you need to first decide upon a budget.

a budget is telling your money where to go instead of wondering where it went. dave ramsey with my husband

Photo of when my husband met Dave Ramsey, the author of Total Money Makeover. If there is anyone out there that knows finances and how to pay off debt, it’s this guy. His valuable programs have helped thousands of people all over the world to pay off their debt and become financially stable.

Fun fact- My husband didn’t even know who Dave Ramsey was when he met him, just knew that I was a fan.

Okay, back to the matter at hand, creating a personal budget for YOU!

So, let me help you to make a budget today and take control of your life.

First- What is the definition of budget?

A budget is pretty much just a fancy word for “plan.” The purpose of a budget is to help decide where to spend your money. Making one is as simple as writing down your income and expenses and figuring out how much money to spend in one area and not another.

Not so scary now, is it?

I’ve included in this post a download for a FREE set of budget worksheets to help you take control of your personal finances.

how to make a budget 5 piece free download bundle set personal finances budget tracker printable
Completely FREE download, just click the button below!

This 5 piece set should come in pretty handy with tracking your money and expenses.

Now on to the task at hand, creating a budget, for you.

How to Make a Budget

step 1

Write down your total income for the month.

This is your take-home pay, after taxes and standard deductions.

If you’re sharing income with a spouse then make sure to include their income as well.

Track every source of income, don’t forget side gigs, paid hobbies and social security checks.

step 2

List all of your expenses for a month.

Prioritize them as you list them, starting with the most important bills. Work your way down to the least important.

Rent/mortgage, electricity, water, heat, food, gas, entertainment, etc.

Everything you would expect to normally pay, include it on this list.

step 3

Subtract expenses from income.

By doing this, you’re able to see what is referred to as a zero-based budget.

Your income minus your expenses should equal zero.

If you’re over, meaning that you have more expense than income, you’re in debt.

The best solution is to cut unnecessary expenses and increase your income.

If you’re under, then you have more income than expenses. Leaving you with extra disposable income to throw towards debt or savings.

Increasing car, house, or minimum payments on credit cards, can help to reduce the interest you pay in the long run. It also helps to get them off your plate much faster.

step 4

Track your expenses throughout the month.

Stay on top of all your monthly expenses and income for the next few months, to make sure you can account for every dollar.

If you can’t account for every dollar in your finances, then you’re going to need to look for the leaks in your budget.

Sometimes it can take a few months to fine-tune a budget because these leaks are hard to find until they come out.

Heck, I just posted my January income report, and shared how I just found a leak that’s been costing me $1.06-$5 a month for the past 36 months! And this past month alone it cost me $202 in overdraft fees!

So don’t feel discouraged by leaks, they happen to all of us.

But the more you can catch, the more you can stop.

[Related] The Worst Advice We’ve Ever Heard About Budgeting

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