Making a Budget One Step at a Time

B-U-D-G-E-T.

The six-letter word that tells me I can't buy those shoes if I want a date with my husband this weekend. Yes, the BUDGET. The binding, creeping, scheming thing that is always in the back of my mind, scaring away all the great impulse buys.

Okay, so it's easy to see a budget as a scary thing; something that restricts your spending when you really, really want to go out with friends, or buy that new pair of perfect-fitting jeans. Although creating and maintaining a workable, functioning budget can seem like a daunting task, it can be made into a small and simple chore that needs to be done at the beginning of every month-like polishing the wood furniture. It's been my experience that, after getting married and sharing finances over the last few years, creating a budget is actually one of the fastest and easiest ways to save money. And don't be fooled: you CAN save! The most important thing is to remember to make saving money a priority when it comes to your budget, and promising not to touch that savings account.

While I realize that every family is financially different (different BAH amounts, small vs. large families), I'll be using my own budget* to create a basic budget format, an easy to follow step-by-step guide on how to create a basic working household budget for military families.

Before starting, I recommend dividing all family expenses into three different categories (or however many you'd like, just keep it simple): Bills, Household, and Leisure/Savings. The Bills category includes just that: all bills including car payment, car insurance, phone bill, cable/internet, credit card payment, water, etc. The Household category includes groceries, gas (vehicle), and things like beauty/hygiene products. The Leisure/Savings category (my favorite) is for what's left over after bills and groceries, which is divided into money sent to savings and money for entertainment, i.e. eating out, seeing a movie, clothes shopping, date night, etc.

After dividing up the household expenses for the month, all that's left to do is the math! Here is an example of what my monthly budget will look like on paper*:

Husband's income + my income + BAH = $5,000*

Total Bills expense (including rent) = 2,500*

Total Income (5,000) - Bills (2,500) = 2,500*

Total Income after Bills (2,500) - Total Household expenses (700*) = 1,800*

This leaves my husband and I with $1,800 after all true expenses have been deducted. To be realistic, my husband and I would put around $1,000 of that into our savings account, and let ourselves have $800 as spending money, or extra disposable money for the month. No matter how much we have left over, I try to put at least half, if not more than half, into our savings account. Even if it's a hard month and a lot of things come up, like two flat tires we have to replace or one of us gets sick and misses a few days of work, EVEN IF there is only 100 left for that third Leisure/Savings category, we'll put half of that into savings. The important thing is to stick to your commitment to save, because a dollar saved is definitely a dollar not spent. And some months we might go without eating out as much, or without going to see a movie or having a date night, but in the end it's worth having a little more in our savings account.

To save money is a commitment, and something that you'll have to stick to. Trust me, I have my obstacles (that perfect hobo bag!), but having a budget helps manage those impulse buys, and builds your savings account more and more every month. Best of all, a budget is something that can be changed and molded to fit your own family's' needs, creating a specific budget for each individual situation. By following these guidelines, you'll be saving in no time! Just remember, saving money is like exercise: you have to stick with it to see the results!

Happy Saving!

* Indicates dollar amounts have been changed for privacy reasons.