If you’re new to budgeting, or you’ve been budgeting for a while and you’re curious what someone else’s budget looks like, I understand. I get curious myself. But most of the time, we never get the answer to “what’s in your budget?” because we either don’t ask, or we don’t want to talk about it.
That can be frustrating if you’re trying to get a handle on what a real budget looks like. So to help you out, I’m going to spend the next two weeks walking you through my budget, starting today. Are you ready?
My family uses YNAB for our budget, and if you go to https://www.chriscookley.com/YNAB to sign up, you and I will both get a month for free. Who doesn’t love free?
Our budget is broken up into five category groups. There’s a number of ways you can organize your budget, either by category type or frequency of use, and we do a little bit of both. Primarily, we organize by frequency of use. What does that mean?
I define frequency of use as how often that budget category gets used. So my budget category groups are:
Everyday are categories we might use on any given day. Things like groceries and gas are Everyday expenses.
Monthly is pretty self explanatory, these are our monthly bills. Electricity, water, cell service, etc.
Recurring are regularly scheduled expenses that don’t happen every month, so for example our recycling is billed every three months, same with our pest control. Amazon Prime gets billed one a year. Those go into Recurring.
Debt is debt. All we have in debt is our mortgage, and while technically that could be a monthly expense, I like to keep debt separate. We used to have our student loans and car loans listed in debt as well, but thankfully those are gone.
Savings is for saving money. Crazy, right? We have categories in there for various different things we’re saving for. We’ll cover those at the end of the series.
Can you see how we use both frequency of use, and category type? Everyday, Monthly, and Recurring are frequency of use groups. Debt and Savings are category type groups.
For my fellow nerds, here’s the breakdown.
This is what percentage of our income gets allocated to each of the five groups:
|Category Groups||% of Overall|
Over the next five posts, I’ll be looking in depth at each of my five category groups, showing you exactly what categories are in my budget, and what percentage of the budget those categories make up.
I hope this helps you with building your own budget! Our budget has been the most important piece of our financial transformation. Without it, we would have never paid off so much debt and put ourselves in the position we’re currently in. I know a budget can help you achieve your goals, too.