Organizing and Managing a Budget

Organizing and managing a budget works much the same way as organizing and managing your time. There are several steps to take as you go about organizing and managing your money. First, I’ll review the steps to take to organize your budget.

Organizing A Budget

Track how you are currently using your money

For one month keep track of every bit of your spending. Keep and organize all receipts – even for cash purchases. If you didn’t get a receipt, write the amount down on a piece of paper in your wallet or on another receipt that you have. I’m a pencil and paper girl when it comes to tracking and managing my money but there are also apps that can help you with your money tracking. As I said, I am a paper/pencil girl so I have not personally tried these.

Think back on previous years. Do you spend more money some months than others? Many people spend more money during the holiday season or during vacation time. Estimate how much extra money you will want for those special times.

Be aware of how much money you have available monthly

Do you receive or allow yourself to withdraw the same amount of money each month?  If your income is irregular, can you estimate your expected income for each month and then estimate your average income? Having a grasp of these numbers will help you as you are organizing your budget.

Do you usually get a refund after filing your taxes or do you have to pay?

Categorize your spending

How much are you spending on:

• Rent or mortgage payments – include any HOA fees
• Utilities – including your phone and internet
• Household expenses – items you buy for your home
• Subscriptions – magazines, newspapers
• Hired help – lawn care, cleaning team, etc.,
• Insurances
• Auto expenses and/or other transportation expenses
• Groceries
• Entertainment, travel, and eating out
• Annual membership fees
• Personal care – haircuts, manicures, pedicures, etc.
• Clothes
• Gifts
• Donations
• Medical
• Paying off loans
• Fees – bank fees, credit card fees,
• Taxes
• Savings
• Anything else that is not listed here

Assign amounts to each category

As you are putting together how much you are spending each month, put that information into a category.

Decide how much you can spend in each category.

Start with categories that are currently set and not negotiable. These are your basic fixed expenses. If you pay rent, that is not negotiable. Most insurance fees are set. If you are paying off a student loan, that is also usually fixed.

Put those amounts down by the categories. Add them up and deduct that from what you have coming in.

Now decide how much you have available for the other categories. This can be a real juggling act and a real eye-opener.

Play with it until the outgo is less than income.

Prioritize

What do you need and what do you want?

You need a phone, but do you need all the bells and whistles?

You need to eat but do you need to eat out every day?

Get rid of what you don’t need.

As you analyze your spending you may find you are paying for things you don’t even use. You may have signed up for a free (for so long) program that you are now paying for but rarely using.

Organizing a budget takes a lot of time at the beginning. But once it is set up, it just needs monthly maintenance.

Managing Your Budget

At the end of each year reevaluate. Has the cost of some items on your budget gone up? Has your income increased? Reevaluate how much money you have assigned to each category and adjust it for the next year.

If you track and manage your money you will find that you have more money for the things that are really important to you. When you know where your money goes your life is less stressful. You don’t worry about overspending and late fees.

If you are ready to organize and manage a budget, or ready to work on any other organizing project join Diane Quintana and me in our Clear Space For You virtual clutter support group. The group will offer ideas, support, and gentle accountability for working on developing plans or projects.

 

Jonda S. Beattie, Professional Organizer owner of Time Space Organization, and co-owner of Release, Repurpose, Reorganize. She is based in the Metro-Atlanta area. As presenter, award-winning author, as well as a retired special education teacher she uses her listening skills, problem solving skills, knowledge of different learning techniques, ADHD specialty, and paper management skills to help clients.