Budgeting

It's a nasty word isn't it?

It doesn't have to be! But you do have to find what works for you. Since the beginning of the year I have read books, articles and blogs on the subject and there is a lot of information out there. There is budgeting software and budgeting books - it's hard to know where to begin.

One thing I do agree with all of them on is that I should be living on 80% of what I make. While I'm not yet there I am trying - I am pushing myself to save more and spend less!

After months of trial and error I have come up with the easiest and simplest budget for us. It may not work for you but I figured I'd share what we do.

I have decided that breaking stuff down into every single category just doesn't work for us. I had started with a clothes budget and a movie budget and a toys budget and going-out-to-eat budget but it became too much. When we went out we would have to divide in our heads what came out of what part of the budget and what we had left in what category and some categories we would over-use and some we wouldn't use at all. Too much work!! I have enough work already with 3 two-year-olds :)

So instead I divide like this:

Mortgage _________
Tithe _________ (you are giving away 10% right?)
Debt _________ (this is total debt monthly payment)
Utilities _________ (phone, cable, electric, gas, water, trash - all of it)
Savings _________ (this too should be 10%)
Food _________
Gas _________
Insurance _________
Diapers _________
House _________ (this includes our alarm, HOA and other repairs)
Car _________ (includes payment and repairs)
Medical _________
Other/Free _________

The last category is basically everything else. While I know most people suggest breaking it out and assigning a value to every dollar I just can't right now. This is my basic starter budget. Someday when I get better at this then maybe I can do it different but right now if I spend the clothes budget on eating out I don't care as long as I don't go over budget in total and DON'T use a credit card.

I also don't have a clothing budget because that does not come out of our general funds. I use the money I make selling clothes to buy more clothes. Sometimes if we have extra I'll use that too but no, I don't believe that we'll never buy clothes again!

What about you? Do you break everything down? If so, what is your best tip for managing it?