Setting Up a Budget

One of the most important things you can do to start the process of going green in all aspects of your life is to set up a budget. If you are not managing your money properly then any steps you would desire to take to improve your life would most likely be unsuccessful or not as beneficial as they should be. For me, setting up a budget involved creating a spreadsheet to write down my income and expenses into. I needed to be able to share this budget with my wife and so I created it in Google Docs. This has been very beneficial to us and as I've improved it we've learned a lot about where our money goes and how much we spend on things, it also helped us identify problem areas in our spending. You can create the budget in any way you'd like, be it spreadsheet or on a piece of paper.

The things you want to do when you consider a budget is plan out your average monthly income and expenses and mark it off, that way you can see how accurate you are in your planning. For income I always round down so that I have a few cents more per month than what I plan. I also figure out all the places my money typically goes, consistent monthly bills. For these bills I figure the most I typically spend on them and then round up, usually making a nice round dollar number unless the bill is exactly the same every month. The reason I do this is that then I am over planning which will give me some wiggle room if things don't go exactly as planned. Once you have the layout of your budget, the income and the necessary monthly expenses, it is time to plan for your not so consistent expenses.

Non-consistent expenses would include spending, date, medical and gift money. For me I planned out different spending expenses for my wife, my daughter and myself. By planning these out I allow us to go get things we want without damaging our planned budget. Plus, by having a limit we then have to plan how we want to use the money we are allowed. At times this is difficult but you learn to live with it eventually. The date money is important, you need to be able to go out and spend time with your significant other if you have one. The gift money is calculated by figuring out the typical presents and amount you would want to spend on them for a year, normally birthdays and Christmas, I then add more in for the weddings, baby showers, etc. All this money you need for the year is then divided by 12 to figure out how much you have to set aside each month in order to be able to buy all those presents. The same is done for medical, you try to figure out how much you'll need to set aside so that you can spread it out through the year instead of scrambling to find funds when you have a sudden medical bill.

One of the last things, but one of the more important things you need to do with your budget is plan on saving some money. For me, through my bank, they have a savings account that has no charges if you meet certain requirements, one of them being to transfer a consistent amount of money every month to the account. This is what determined how much I send to savings, I eventually want to send more, however we have a very tight budget.

After creating the budget, and trying to make goals for it over the years that we have been married, we found out what some things were costing us and determined if they were really that important. One of our goals was when we had children we wanted my wife to be able to stay home and take care of them, so we had to cut back on some things and really reign in anything that wasn't well planned for. We were successful in this goal and she now stays home with our daughter. We found that we can comfortable live on about $75/week for food between 3 people, it took some time to find all the right places to go, but now most of our food on this budget is unprepared, meaning we make a lot of things from scratch, but this was a change I wanted to make anyway. We have found the food we buy and eat makes us feel better as well as being kind to our budget. Some of the things we found we didn't need were cable and formal home phone service. Being a bit technical I found ways to get home phones without the costs associated with it, and for the rest of it we use a pay-as-you-go plan that had some good rates. To make up for the lack of cable we eventually went with Netflix, their ability to stream to our Wii means we actually get our money's worth, which we calculate by figuring out how many movies we would have to watch from the dollar kiosks to meet or exceed the monthly fee. The only thing we didn't give up, because it provides so much entertainment for us is the internet, we can give it up if we have to but I do my best to make sure we have room for it as long as we can.

I do plan on posting my budget, but I need to make a copy and clean it up, putting relevant information in it. When I do you are free to copy it, distribute it, do whatever you want with it, I hope it will help quite a few people to see it. I don't claim it to be perfect but it does what we need it to. I hope you all understand a little bit better now the importance of making a budget when you plan to make your life a little greener.