Organize it: Family Finances Day 3

You have made it to day #3 of the series, CONGRATS!  We are almost through putting the systems in place.  Stick with it! #peptalkfortheday

Step 1:  Open Quicken (or your software) and you should see your downloaded transactions.  This happens when you initially set-up the accounts.  Hopefully you were able to do the "Web Connect" feature so your transactions download automatically.  If not, comment below and we can brainstorm another solution.

Quicken guesses at categorizing your expenses, but you will need to run through your transactions and ensure that your Categories are set the way that you want them.  This will be a bit time consuming, but this will really help your accuracy in determining your monthly budget.  If you are already feeling a bit overwhelmed, please fight the urge to download ALL your transactions from the last XX years, and just focus in on the last calendar year.  At another point, you can import and categorize the other transactions. 

Step 2: Use your new software (i.e. Quicken) to see what you spend each month by category.  In my version of Quicken, I can use the "Category Summary" and see what I am spending each month.  Or, you can use the "Spending Over Time" to see what your yearly budget looks like.  Just take a few minutes to run through the reporting features and find which one fits your needs best.

Step 3: Use these reporting tools to set a budget for your family.

Income categories will/can be:

• Salary
• Salary Spouse
• Other

Expense categories will/can be:

• Auto (Car payment, gas, insurance)
• Childcare
• Cell Phone
• Charity/Tithe
• Clothing
• Entertainment
• Gifts
• Groceries
• Dining out
• Mortgage
• Savings
• Household
• Medical
• Bills (cable, gas, electric, water, etc)
• Misc expenses

This list of categories is just a place to start.  The good thing about doing your own budget, is that is is YOUR OWN BUDGET.  You may have 50 categories or maybe only 15.  Try to cover all of your monthly/yearly expenses (for example, if you know you have a big payment coming up in a certain month - then make sure to include that in your expenses so you can plan accordingly).

A fun, cute printable would make creating a budget easier, right?  That's what I was thinking.  So, here you go!

Click to Download

A few things to remember:

• Budget by making wise estimates (Your Auto:Gas will fluctuate each month so it's not important to get the number dead-on... because you won't be able to.  Just make an estimate)
• There will be times during the year when certain categories will be higher - gifts/household will be higher in December, Clothing will be higher at the beginning of spring/fall.

Talk this through with your significant other and make sure you are on the same page.  If you do not have a budget and this is your first attempt, you will probably be surprised by your spending habits.  We were surprised by how much we spent on groceries, eating out and clothing.  Since we know those are our "hot buttons" we have devised a system to keep closer tabs on those categories.  I will go into that later on.

Okay people, that's it for Day 3.  Whew.  We made it.  I hope you are following along and implementing these new strategies.  Are you?  I'd love to hear from you about your progress OR any issues that you are having.  I heart success stories.  I heart progress.