Today I want to show you that you can have the perfect budget in less than 10 minutes.  I shared a while back in this post my best secrets for creating a flexible budget.  I’ve had a lot of people ask just how I did it.  So I created a quick video that shares my best stuff!  Check it out here.

If you like to go through it step-by-step then keep reading.  Let’s start with the most important part of creating a better budget…

Budgets are here to help.

So many people I have talked with are afraid of budgets.  That’s silly. Budgets can help you succeed, hit your goals and retire comfortably.

Budgets don’t have to be complicated either.  In less than 10 minutes you should have a working budget to go off of.  

Here’s my no fail guide on how to create a flexible budget in under 10 minutes.

Step One:

Gather your bills.  I’m assuming you know where your bill information is kept.  So, if you can’t find them in less than 10 minutes then that’s not on me.

Grab a pen and paper or use Excel.  I prefer Google Sheets because you can update it and check it from anywhere.  I even use Google Sheets as our check register and it works fantastic!

Step Two:

Create two column for monthly bills and expenses, the first one will be the name of your expense and second column is for the amount.  You can even add another column marked for due date so you never miss a deadline.  Start filling in.

This section is for your monthly bills and your debt.  So to be sure to list out your credit cards, personal loans, car loans, etc.

TIP: It’s best to calculate the monthly amount for any quarterly or annual bills you may have.  You need to be setting it aside each month.  For instance, you real property tax is $822 due by December 31st.  If you are creating your budget in January then you need to take $822 divided by 12 months.  You would get $68.50.  You should be putting back $68.50 a month.  

Now let’s say your tax is still $822 but you’re creating your budget in February.  You will take $822 divided by 11 months to get $74.73.  You should be putting that amount into a savings account each month.

This tip will help those type of bills from creeping up on you.

Step Three:

Other monthly spending should be accounted for – groceries, gas money, eating out, savings, retirement, etc. The easiest way to see how much you’re spending is by logging into your bank account.  You can pull a month’s worth of charges and add them up for each category.

TIP:  You need to lower these amounts if you find yourself in the red at the end of every month.  If you’re spending $400 a month for groceries for two people then look at reducing it.  You’ll have to shop smarter.  I recommend keeping your grocery budget to $100 per person in the family.  So for a family of two that would be $200.    

Step Four:

Write down your income.  You need to know about how much you have coming in every month.  Don’t count on bonuses, just put your monthly salary down.  We don’t want to depend on money that isn’t guaranteed.  That’s why we leave off bonuses and commissions.  Just put your base pay in here.

Step Five:

You’re done.  Now you need to add up your expenses and income.  Make sure you aren’t spending more than you make.  If you have extra income left over then look at putting it to good use.  Pay down your debt and start to build up your retirement funding.