Have you ever used a spending plan? This is a great tool which can really help you see where your money goes every month. It really helps you track your cash flow and honestly, can be very eye opening.
If you are struggling with creating a budget, this can be the perfect way to get started. You can track your spending over a month (or even two or more). It will help you learn where you may be overspending. The form may also show you why you may be living paycheck to paycheck.
To make it simple for you, we’ve created a Free Spending Plan Spreadsheet. What is great is that it does all of the calculations for you (less chances that you will make an error that way)!
1. Enter the pay period at the top of the form. Record your income in this line. If you and your partner/spouse are paid on the same schedule, total your income together. However, if you are paid on different schedules, then each of your income amounts will be recorded separately.
2. Go through your bank account to find your expenses. Look at all of the outflows of money for each pay period. Do not leave ANYTHING off. If you know you spend cash, make sure that you include that in the various categories. It is important that you leave NOTHING off of the list. You may think it is too small to be included. Keep in mind that it is the small items which add up.
For instance, you might spend $150 at the grocery store. However, you also had 3 other smaller trips where you spend $25 more. You will record $175 under groceries.
3. Now track your “left over money”. As you entered the expenses into the sheet, you will notice that your left over money is automatically tracked. This helps you see what money is left after you make each payment during each pay period. If the ending amount is negative, it means you are spending too much during your pay period. You will need to find a way to make an adjustment going forward. This happens by holding money back from one pay period. It may also mean carrying forward money to use at a later date.
You now have the expenses to include on your monthly budget! The spending form helped you determine where your money goes each month. As you complete your budget, you can make spending adjustments. You might find that you are spending far too much dining out and need to make a change. The form may also show that you have money left every pay period which you should be applying towards your debt.
You may not like what you see, but now, you know what changes you need to make so that you can work towards achieving your financial goals.