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How to Budget

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How to Budget

Know Your Why

When you have a clear focus as to “why” you are creating and following a budget, then you are more likely to stick with it. What’s most important to you? It can be anything! Your family, your time, hanging out with friends, saving for retirement, or even having nice things. Creating a budget gives you control over your finances so you can direct your money towards your "Why".

Be Honest With Yourself

Finances are 80% behavior and 20% head knowledge (Ramsey), which means that knowing how to budget is a small piece of the pie. Being motivated will allow you to stick with behaviors to develop good habits for a lifetime.

Make a Plan

Creating a budget is one of the first steps you must take in order to become financially prepared. There are many different methods of budgeting that work. It's important to find the method that is right for you. Want to discuss budgeting with your MoneyCoach?

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Budgeting Basics

Budgeting Methods

Budgeting methods will help you become financially savvy. Use a combination for best results.

Smartphone Apps

Every Dollar App and Good Budget App are zero-based budgeting apps designed for budgeting monthly expenses. 

What Is a Zero-Based Budget?

The concept of a zero-based budget is simple: income minus outgo equals zero. If you earn $3,000 a month, you want every item that you spend, save, give, or invest to all add up to $3,000. That way, you know where every one of your dollars is going. Not knowing where money is going is the biggest roadblock to being financially sound. With money flying out the door unchecked, you could look up one day and find you have no money—and no clue about where it went!

How to Make a Zero-Based Budget:

  1. Write down your monthly income.
  2. Write down your monthly expenses (bills).
  3. Write down your other expenses.
  4. Subtract your income from your expenses to equal zero.

Budget Worksheet

You may prefer to maintain a hand written budget sheet. Click on the link below to access the student budget worksheet. You can create a budget for weekly, bi-weekly, or monthly incomes. The budget worksheet is easy, just write down your expected expenses in the "Budgeted Amount" area and enter the amount you actually spent in the "Actual" column. Then subtract "Actual Expenses" from your "Net Income" to determine your "Net Disposable Income" for the month.

During College Budget (.pdf)

Post College Budget (.pdf)

Budget Worksheet (.xls)

Envelope Method

The envelope method can be used with cash or a debit card. Having large amounts of cash on hand can be risky. The debit card variation is recommended. Each month pay your bills as usual but set a specific amount aside for discretionary spending (groceries, eating out, gifts, etc.).

How to start the envelope method

  • Make a list of all your current expenses
  • Organize by category: rent, utilities, entertainment, personal care, etc.
  • Create an envelope for each category
  • When you get paid, fill each envelope with the amount you budgeted for that category
  • Pay for your expenses out of the appropriate envelopes
  • At the end of the month, put all unspent money into a savings account


  1. The debit card variation uses envelopes for tracking but does not put cash inside.
  2. You may need to modify your categories and amount allocations for the first few months.
  3. If a monthly system is not right for you, you can also try a weekly or bi-weekly envelope system.

Calendar Method

This budgeting method can be used to keep track of income and monthly bills. A calendar with larger spaces to write on typically works best.

  • (Create a Calendar "folder" named "Bills").
  • Add your income into the dates you get paid.
  • Add all bills and expenses to the date.
  • When you pay your bills, cross it off the calendar.

Tip: It's best to determine your calendar budget before the new month begins.

The calendar is a great tool for those with minimal expenses. You can also use it to track uncommon expenses that don't occur each month such as tuition or holiday spending.