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3 Steps to Get Started With Any Personal Budget Program

Whether you’re new to budgeting or have been doing it for years, these three quick steps will guide your budgeting program toward success.

Whether you’re brand new to budgeting or have been doing it for twenty years, these three quick steps will guide your budgeting process toward success.

1: Choose your categories.

Fixed and Living Expenses Categroies

How do you spend and earn your money? Categories are crucial for budgeting. They help you stay organized and focused through the month, week, or any other time interval in which you’re keeping a budget.

At Tiller, we recommend keeping it simple with your categories. This is especially true if you’re new to budgeting.

One method of establishing categories is to use the fixed, living, discretionary, and giving model.

Fixed expenses are those that are the same each month, like your mortgage, car payment, or debt repayment.

Fixed expenses are those that are necessary, but might vary from month to month like groceries, gas, or utilities.

Discretionary expenses include spending that isn’t really necessary but makes life a little more enjoyable. Things like going out to restaurants, concerts, or other entertainment.

Finally, giving expenses is money you’re sharing with others like charities, non-profits or your church.

This is just one way to think about how you might organize categories for your budget. Tiller’s financial spreadsheet templates allow you to specify a group and a category, so you can keep it simple with a few basic groups like the above and get more granular with the categories in each group.

With up to 200 unique categories this allows for ultimate flexibility, but a pretty simple way to organize how you spend and earn.

Regardless of how you organize your categories, the key is that this is one of your first steps.

If you’re unsure, keep it simple, and refine later as you start to improve your budget.

Keep it simple, and refine later as you start to improve your budget.

2: Track your spending.

Type Transaction Categories 2

Once you’ve set up a way to organize your money into “buckets” you can now start track it within those buckets.

This is a major step in shifting your finances towards meeting your goals and staying on track with your budget.

As you track, you build awareness. As your awareness grows, you’re empowered with the information you need to make change.

Spend some time reviewing the transactions on your bank and credit card statements or if you’re using Tiller you can easily do this all in one place across all your accounts from the Transactions sheet. Assign a category to each of your purchases and money earned. Tally it up and start to build the big picture of where it’s all going.

As you track, you build awareness. As your awareness grows, you’re empowered with the information you need to make change.

We recommend going through this process for the last month up to today, or if that’s too overwhelming just start with this week and go forward. The more financial transactions you can organize into those categories, the more awareness you’ll see more quickly.

Have you started to see any patterns? Maybe you spend more than you thought you did on dining out at restaurants or see your shopping sprees at that cute clothing boutique downtown have gotten out of control.

Either way, you now have the information to make change.

3: Set an intention.

Tiller Budget for Google Spreadsheets

Why are you budgeting in the first place? You’re now empowered with information about your money, where it’s going, and how you’re voting with your dollars. Now what?

What are your financial goals and dreams? Why is budgeting important to you?

Start small and set one easy to achieve intention with your budgeting. Perhaps it’s “I’ll check in on and categorize my transactions twice a week.”

Once you’ve realized how easy this is, especially with Tiller, you can set another small intention. “I’ll reduce my restaurant spending by $10 next month.”

Perhaps then that $10 goes toward paying off debt or is put away toward a down payment on a house you want to buy one day.

The point of an intention is that it keeps you focused. You’ll start to see progress toward achieving your goals with these quick financial wins and stay empowered and encouraged.

As you get more comfortable with budgeting you’ll be able to set and achieve larger financial goals and ultimately be better controlling the tiller on the sailboat that is your life.

See: Tiller budgeting templates for Google Sheets

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Heather Phillips
Heather comes from a background of user experience design & customer support. She loves helping others learn, explore and discover better ways to use applications and products that improve their lives. When she’s not coaching customers on Tiller best practices, tweeting or writing blogs, she’s probably at a yoga class, out for a hike in the Blue Ridge, or off volunteering for a variety of non-profits.
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