Step #3 – Calculate food and personal expenses.

After you’ve made a plan and faced your debts, you need to start calculating your expenses. Start with your fixed expenses. Print out a bank statement and credit card statement for the last month. Use different colors and mark every food expense and personal expense. Once you start, you will see a pattern and decide how many colors to use or expense categories you want to use.

Photo by Jay Wennington on Unsplash

Food – I suggest breaking out food into grocery store and eating out. Food expense is such an easy place to overspend when you’re not budgeting and keeping track of it. I keep my Costco purchases in a separate category because I don’t get very often and it can derail my weekly grocery budget. So, I just keep it separate. I also budget separately for my kids’ school lunch accounts. Don’t be discouraged if this number is really high. When you’re aware, you can easily start to fix this if your current spending habits aren’t in line with your goals. Look back at your goals, and figure out if your food spending is keeping you from working towards your goals.

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This is not how I look when I go shopping. Haha. My kids are usually in tow and mad because I didn’t buy all the things.

Personal – I like to break the personal expenses into lots of categories. This is a good area to start using cash envelopes to get this spending category back in line. In the personal category, I include personal expenses like haircuts, gifts, cash, clothing, dog grooming, and items for the house (all the stuff I buy at Target). Just like using cash envelopes, I like to put the same amount away each month for these items. If I put away $40 per person each month for clothes, I have a good amount in that category when it is time to buy clothes. I try to buy my kids some clothes each season. The only time I completely clear out this category is when it’s back to school time. I do the same thing with haircuts and gifts. These amounts can hit all at once. But, I try to be prepared. If I set aside so much each month for these items, I have the right amount when you need it.

I’m breaking down my budget starting basics into six easy steps. If you spend 30 minutes on your budget each week, you will have a budget set up and ready to start at the end of six weeks. Then, I’ll help you keep it going and sticking to your budget.


Saving Money in the Yard.

Where I live, it is finally spring. We might have a few more random snowstorms but the snow shouldn’t stick or need to be shoveled. When the snow melts, I want to get flowers in there as soon as possible. I love flowers but we have definitely overspent in our yard before. Here are some tips on saving money in the yard.

  1. Buy perennials instead of annuals. Perennials will come back year after year. They are more expensive initially. So, I suggest buying a few each year. In no time, you’ll have a beautiful yard of flowers that come back year after year.
  2. DIY Maintenance. It’s so tempting to call a yard service and have them take care of your yard all the time. But, you can save a lot of money by doing it yourself. If you don’t want to do that, you might find a teenager that would bring their own mower and mow yours for a lower price then the yard services. We also fertilize ourselves and use Miracle-Grow to help our flowers grow bigger and faster.
  3. Water Less. We have several neighbors that constantly water their lawns and they look green all summer. We cut back a little and are able to still maintain a nice lawn. Watering less also cuts back on mowing requirements. Check the acidity of your lawn with a pH kit at the hardware store. The acidity could have more to do with the color of your lawn then the amount of water it receives.
  4. Container gardening. Getting some of your flowers out of the ground and into containers adds texture, variety and volume. Fill your own containers that you can reuse every year. The cute pre-made containers at the gardening store are fairly expensive.
  5. Refurbish old furniture. Do you really need to buy new outdoor furniture every year? Most of the time, new chair pads every couple of years will do the trick. But, secure the pads out of the weather during the winter. We keep our furniture for a long time and then replace the pads occasionally.

Bonus Tip: If you like fresh flowers but not spending the money on something that gets thrown away, cut flowers out of your yard and put them in a vase. Gorgeous and FREE!

As always, a penny saved is a penny earned. This year is a good time to look outside and see what areas you could save money on. Then, use your extra money to build your emergency savings or pay off debt.

E-mail me for my free budget consultations at erin@e3accounting.com


Set Financial Goals

Do you feel stuck? Are you not great with numbers or money? Do you not know where to start with a budget? I’m breaking down setting a budget into small 30-minute steps. If you follow these steps every week, I’ll have you managing your own budget in just two months.

  • Brainstorm. You will start by brainstorming a bunch of goals you could have. In other posts, I will show you pros and cons of certain goals. However, I’m not going to tell you which is the best goal. Here are some ideas but you should sit down and write your goals with your partner.
    • Emergency fund
    • Debt reduction or elimination
    • Save money for big purchases
    • Retirement
    • Insurance or Death planning
    • Live on less then you earn
    • Give to others
    • Find work you love
  • Prioritize. Once your list is complete, go through and pick out two or three goals that you and your partner want to focus on. Have you ever watched a three-year old soccer game? Each kid’s goal is the same to kick the ball, but they don’t really go anywhere. You need to work together with your partner to create a focus for your goals. The other goals can also be priorities but you need to start by focusing on a few goals at a time.
  • SMART. Now that you have some goals set as priorities, convert them into smart goals. This stands for Smart, Measurable, Attainable, Relevant and Timely. You need to specify what your goal is so you can measure it.
  • Plan. Now, you can plan. Break the goals into smaller goals. You are not going to specifically figure out where the money is coming from just yet. You are only going to break it up into smaller goals.

Getting started on a budget does not have to be time-consuming or exhausting. You can make your budget work for you. This week, our only focus is to figure out what our goals are and when we want to achieve them.


Debt Worksheet

Step #1 in a budget or spending plan is a debt worksheet. Get out a piece of paper and gather all the information about your debt. I like to have a chart to track my payoff progress.

Seriously, now is the time to sit down and face your debts. Finding how much you owe is a big step in making a plan. You don’t have to pay them all off. But, you need to pay off the ones that are high interest rates or high payments. Make it easier to pay for the debts you have by paying off these ones.

Here is my debt worksheet. Print two copies if you have more then five debts.