How to budget for the month and year: a guide with examples

2024 Author: Malcolm Clapton | [email protected]. Last modified: 2023-12-17 03:44

The financial plan will help you not to be left without money at the most crucial moment.

The main task in drawing up a personal budget is not just to reduce debit with credit, but to correctly distribute spending so that in the last week before the salary you do not have to borrow or live from hand to mouth.

You can plan your budget in special applications or any spreadsheets - the principle is the same.

How to budget for a month

As a rule, the main part of the salary is not paid on the first day of the month, but on the 5th, 10th or 15th. Therefore, it will be more convenient to plan a budget not for a calendar month, but for the period from paycheck to paycheck, for example, from March 10 to April 9.

Income

First, you need to record all financial receipts in order to understand how much you have at your disposal. All sources of income should be taken into account: salary, bonuses, part-time jobs, money from renting an apartment, and so on. In case of unstable earnings, it makes sense to form a budget when you will know exactly how much you have, for example, on the day the money is credited to the card.

Expenses

The first should be written down the items of expenditure, which cannot be dispensed with in any way. This list will look something like this:

1. Groceries (including lunch at work if you eat in the cafeteria).
2. Communal payments.
3. Directions.
4. Mobile connection.
5. Internet.
6. Household chemicals.

Naturally, the list of mandatory payments will be different for each person and for each family. The fare can be replaced by the cost of gasoline. People with chronic illnesses will consider spending on medications. The same list will include loan payments, a kindergarten fee, and so on. At the same time, the traditional trip to the cinema on Saturdays and similar items of expenditure are not required.

Make it a rule to save money in a "stabilization fund" every month. This can be a fixed amount or a percentage of income.

The amount remaining after the deduction of mandatory expenses can be accessed in two ways:

1. You distribute money for entertainment, clothing, and other amenities.
2. You divide the remaining amount by the number of days in the month.

With the first method, everything is clear: you determine that you will spend 3,000 rubles on a movie, the same amount on clothes, and so on. The second method is worth considering in more detail.

Let's say you have 15,500 rubles left, and there are 31 days in a month. This means that you can spend 500 rubles daily. At the same time, the obligatory expenses have already been taken into account in the budget, so this money is calculated only for pleasant spending or force majeure. Accordingly, if you spend more than this amount per day, then you go into negative territory, and at the end of the month you will have to tighten your belt tighter. If you do not spend anything, then within two weeks, save 7,000 rubles, which can be spent on something big.

The money remaining at the end of the financial period can be spent or postponed. The first way is pleasant, the second is rational.

How to plan your budget for the year

The annual financial plan will need to be regularly adjusted for both expenses and income, so all columns in it need to be created in duplicate: the forecast and the actual indicator.

Income

If you have a steady income

With a fixed amount of earnings, you simply enter the salary and other stable income in the income section. The only thing that will interrupt the usual course of things is vacation pay. Usually, before the vacation, they give money for the days during which you will rest, but then you will miss a certain amount in your salary. But in general, at the forecast stage, especially if you are making a budget for the first time, it will be enough to use only the salary for all months.

If you have a fickle income

With irregular receipts, there are three ways to forecast income:

1. You are sure that you will receive a monthly amount sufficient for a living, although you do not know its exact amount.

Calculate your average income and use it to calculate. If you earn more than the projected amount in any month, move the surplus to the piggy bank. You will get into it if you earn less than average.

2. You do not have a permanent income, and you are not sure what will happen.

It is better to take the minimum income as the basis for calculations. In this case, budget planning will become an asterisk problem, but there will be no financial surprises either.

3. Part of your income is stable, but it is difficult to predict the exact amount of earnings.

For example, you receive a fixed salary, and the availability of a bonus depends on many factors. Then it is worth planning the budget so that a stable income covers all the primary needs, and you will spend on the rest according to the situation.

Do not forget to take into account the income that you receive irregularly: quarterly bonus (every three months), tax refund (once a year), and so on.

For example, let's take a situation where most of the income is stable - this is a salary. The minimum premium is 3,000 rubles, and we will use this figure in our forecast. We also note that for the anniversary in August, they must give at least 20,000 rubles: parents promised 15,000, friends will probably give at least 5,000.

Expenses

When planning expenses, write down the obligatory expenses in the columns of months: for food, utilities, travel, mobile communications, household chemicals, and so on. Please note that in winter utility bills are higher due to heating, and you will spend more on mobile communications, for example, in May, as you are going on vacation. These changes need to be included in the budget.

So, the example shows that in March the heating season ended, so the last increased payment for housing and communal services is scheduled for April. May vacation is also reflected. The budget planner plans to go to visit grandma for three weeks. Tickets have already been purchased, so there is no point in taking this waste into account. Housing and communal services are considered according to the standards and will not change.

At the same time, our hero will not spend money on travel for three weeks. And he cut the cost of food in half: he will eat at home for a week, and will also take on part of the cost of food from his grandmother.

The next step is fixing mandatory but irregular expenses. For example, in May you need to re-register OSAGO, in November - pay tax for an apartment and a car, in May you have a vacation, in August - an anniversary, and in December your gym membership ends. Separately, consider the need to buy gifts for the holidays.

Large expenses can be planned in two ways:

1. Find the entire amount from the monthly budget.
2. Divide it over several months.

The hero of the example used the first method for planning expenses for the anniversary and the second for OSAGO.

It remains to take into account the savings in the budget and calculate the balance. In the example for entertainment, according to the forecast, 8,020 rubles remain (258.7 rubles per day).

Budget adjustments

Every month after receiving income from all sources, the budget will have to be adjusted in order to determine the amount that is really on hand. As information becomes available, it is also worth considering changing costs.

The person in the example received more than he bargained for.

He also spent a little less on food and mobile communications, and a little more on housing and utilities. As a result, after all the obligatory deductions, he still has 12,535 rubles (404, 3 rubles per day) in his hands, which is almost twice as much as the previous result.

It is worth remembering that even if you are extremely disciplined in adhering to a financial plan drawn up with all the details, circumstances can seriously adjust the budget. Losing a job, raising and raising wages, having a baby - all this will require major changes in the financial strategy. But even a poorly prepared budget is better than none at all.