Some of you may wonder if I practice what I preach when it comes to budget advice. The answer is a resounding yes. Thanks to the advice of a friend, I maintained a budget long before I met my wife and established a family. Over the years the categories have been tweaked as budget items came and went, but for the most part a staple group of income and expense items have remained. To help you through the creation or modification of your personal budget, here are some of the categories I use to ensure money is available for the items I need.
I have broken this down into several sub-categories for easier reference, so there are titles for fuel, car insurance, and monthly car payments. Two additional categories, repair and miscellaneous automotive, are available for population when needed. For example, money gets placed in the repair category when a scheduled maintenance, like an oil change, comes up on the calendar. I utilize the miscellaneous automotive category for car washes, registration and license renewals, and the occasional traffic ticket.
Unfortunately, the entries under this category still remain on my budget; however, I am trying my best to eliminate them. In addition to the general credit category I also have entries for my home equity line of credit and student loan. Why isn’t the auto loan listed under this heading? To be honest, I have no idea. At the time I may have felt placement of the loan under the automotive heading would prevent me from forgetting a payment.
I break this heading down into several categories – gas and electric, cable, telephone, and sanitation. At one point in time, the sewer and water were entered as separate categories because they were respectively paid on an annual and quarterly schedule. In the town where I now reside, water and sewer get placed in the gas & electric category.
These sub-categories take up a large part of my budget. In addition to headings for myself, my wife, and the children, I also have lines for church donations, weekly Sunday newspaper purchases, entertainment, birthday gifts for my family and others, holiday purchases, and groceries. Household items are separated into two categories – one for major repairs and the other for cleaning products, small decorations and fixtures, and outdoor items. The categories for my family members are used for spending cash as well as deposits for clothes, shoes, and other items needed for growing children.
Whether you utilize these headings and sub-categories is up to you. Test some of them out in your own budget to determine if they’re useful for future applications or will end up taking space on the ledger that can be used for other important entries.