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Want to look at a realistic example budget to help you make your own budget?
I get it, starting a budget can be overwhelming. And if you’re a visual learner like me, seeing an example budget helps A LOT to get a clear picture of how to make your budget and organize your expenses.
The good news is, I’m sharing an example budget we used a few years ago with our real expenses, savings, and income. My sample budget might now fully match your expenses, income, or savings goals, but it should give you a solid foundation to build your own zero based budget.
The best budget is the one you feel confident and comfortable using. Your budget should reflect your goals, values, and biggest financial priorities.
I hope our budget example helps you do exactly that!
Why Does Everyone Need a Budget?
You might think that’s a bold, sweeping generalization, but I honestly believe that a budget can change your life and help you reach all of your financial goals.
What is a budget?
A budget is WAY more than a spreadsheet limiting how much you can spend.
It’s actually more of the opposite. A budget is a list of your goals, values, and priorities. And that means your budget gives you PERMISSION to spend money on the things you actually care about.
You can use paper and pen, a budget spreadsheet with google sheets or excel, or a budgeting app or software like Tiller Money automated spreadsheets. Read my Tiller Money Review for the inside scoop.
Your budget is a premeditated plan for how you WANT to spend your money. Of course you need to pay your bills, pay down debt, and meet other obligations like buying food and paying rent, BUT life is more than a list of bills.
For example, our budget focuses on ways to save money every month for the things we care about:
- Planning for emergencies (not fun, but totally necessary)
- Planning a stress free Christmas
- Home improvement projects
- A sinking fund to surprise my wife with fun gifts
- Buying a new house
- Hobbies and family fun
Every month, we set aside money to pay for all of these things ON TOP of paying all of our bills.
How a Budget Helps You Achieve Financial Goals
A really popular trend for reaching goals is a vision board or a dream board. I think of our budget in the same way.
Our budget helps us stay focused on what matters in our life AND our budget helps us track our progress as we chase down our big life goals. It’s so easy to get distracted by shiny things in life – new clothes, new cars, FOMO, seeing friends do things you want to do – and lose track of our own financial goals.
Starting a budget will keep you focused on your goals and keep distractions at bay. When you have a clear vision of what you want, you’re much more likely to keep going. Your budget will help you get there faster.
If you’re worried about going over budget or “doing it wrong”, that’s perfectly normal. Everybody who budgets goes over budget as some point. And you don’t need to compare your budget to anyone else, because it’s YOUR budget, and how we spend money can be really personal.
I hope my example budget helps you take the next step to start your own budget.
An Example from My First Budget
When we started budgeting, I scoured the internet for budget spreadsheets and tried to find the perfect sample budget to organize our finances. The bad news was I KNEW I was spending more than I made. The good news is I realized my mistakes and took active steps to fix them.
Like starting my first budget.
If that sounds familiar, I want to help you on your journey of starting a budget by giving you a realistic example budget from our own life. All of these expenses are from our budget, so are the income and savings. This budget reflected our real life goals at the time, and as our life has changed, so has our goals.
Hopefully this example of a budget helps you start your own budget today and end the search for the perfect budget spreadsheet. Besides finding a budget template like the ones listed below, using digital cash envelopes is another great option to help you stick to your budget and build long lasting budgeting skills.
Your budget should be flexible enough to change and adapt as your life changes too. Starting a zero based budget is the perfect way to start a budget that is organized and flexible. This is a snapshot sample budget to get an idea of what a zero based budget looks like.
If you want to try out a few different budgeting rules, these budget examples are my top recommendations right now:
- Zero based budget
- 30 30 30 10 budget
- 70 20 10 budget
And if it strikes fear into your very being thinking about creating a budget spreadsheet from scratch, I’ve got you covered. Grab a $5 budget spreadsheet from me. The monthly budget and annual budget are fully customizable to any situation or budgeting rule you want to try. They’re both designed as zero based budgeting templates and pretty dang easy to set up.
Read more about why I love this monthly budget spreadsheet to see if it’s a good fit for you.
Our Example Budget to Help You Get Started
Okay, let’s take a look at our real life budget full of our real expenses, savings, debt, and income from a few years ago.
Example Budget Disclaimers
Before you dive into looking at our actual expenses and our budget example, I want to give a few disclaimers.
Budgeting takes time to find a groove. It’s okay if you don’t have all of your expenses memorized or have a set dollar amount planned for every single expense. We’d been budgeting for 3-4 years by this point and learned a lot along the way.
These are only sample budget categories from our budget.
Your expenses, income, and goals are probably different from ours. You might live in a place with higher living expenses or have more debt than we did at this time.
We were on the verge of paying off $100,000 in 5 years, so our debt payments were WAY down. We’d already used our debt snowball spreadsheet to stay organized and pay off our debt faster.
Budgeting is personal, so use our example budget to shape your budget. But remember, you don’t need to copy every single expense. These were all of our expenses in 2017, including our income, savings, bills, retirement, and debt savings.
It’s important to prioritize saving money every month. It’s super easy to get caught in the trap of saving whatever’s left at the end of the month. Your money matters, and counting your ‘savings’ as an expense helps you guarantee you’ll save money.
Your budget can be as detailed or general as you want it to be. That’s the beauty of budgeting. For example, I lumped all of our savings goals into one line item ‘savings’.
In reality, I have a separate line item in our budget for each specific savings goal – emergency fund, vacations, Christmas, home improvements, etc. I use a simple savings fund tracker to keep all of our savings goals separate and organized. Same goes for our ‘subscriptions’ category in this budget example.
One of the biggest and most important expenses is rent or mortgage. Depending on where you live, this expense will vary a lot. According to My Mortgage Insider, a pretty standard rule is to spend 28% or less on your mortgage or rent. If you want to pay off your mortgage faster, you can always prioritize making extra payments.
Garbage pick up, water, heat, and air conditioning all fit nicely into a general utilities category. You can choose to lump all of these expenses into one budget category line item, or create a separate budget category for each expense. My preference is a separate budget category so I can track our utility spending more accurately.
Our budget has a separate line item specifically for our electric bill. Since this is a flexible expense for us, I like to see how our electricity use fluctuates throughout the year and what causes big spikes. For example, we bought an electric fireplace that is BEAUTIFUL, but using it daily during the holidays doubled our electric bill. Yikes!
We use Verizon and have unlimited data. Your carrier, the number of phones on your plan, and your data limits will all cause differences in your cell phone. I will admit that your cell phone bill is a great place to save money every month by shopping around.
For us, internet is an absolute necessity. It also helps cut expenses like cable and opt for a few streaming services. And with so many people working remotely, you need to have good, reliable internet. Once again, you could lump ‘internet’ into a more broad ‘utilities’ category if that’s your preference.
Alright, where are my streamers at? This is actually another great way to cut expenses. Most people have one or two streaming services, but it’s likely you don’t need ALL of them. You can also find a way to split services with friends or family. We pay for Hulu and Peacock while sharing Netflix and Disney+ with family. Thankfully this is a pretty small category for us.
Subscriptions could also include gym memberships, magazine or news subscriptions too. A great tip is to get rid of ALL subscription services and then add them back one at a time as you determine how much you’ll ACTUALLY use them.
And remember, budgeting is flexible. If you decide cutting subscriptions right now is a top priority to help you pay off debt faster or save money for a down payment on a house, you can slowly add them back after you reach your savings goals. In the end you might decide you and your budget are better off without some of them.
This is a budget category I’m most proud of in our budget. We spent a LONG time budgeting only $50 a week for groceries for a grand total of $200 a month. Of course that was when we first started budgeting and had no kids. We used the cash envelope method to help us save money and stick to our budget. An even better option is Qube Money, which is digital cash envelopes.
Now our budget is $350 a month for a family of 3, which still boils down to only $75 a week.
If you want to save money on groceries, learn how to get the most out of your food budget. Every dollar you save can help you make extra debt payments or transfer more money to your emergency fund.
For the longest time we completely stopped going out to eat. When we were focused on getting out of debt with our debt snowball spreadsheet, we prepped all of our meals at home and only went out for special occasions that we planned ahead of time. It’s honestly extremely easy to go over budget dining out if you don’t make a plan ahead of time.
If you LOVE going out to eat and have the income to support it, set aside money every month to try new restaurants and do the things you love. That’s what budgeting is all about.
It takes a lot of money to keep your house up and running. Outside of your rent, there are so many other housing expenses and we track ours in a generalized ‘household’ expenses.
Here’s a few household items we budget for in ‘household’:
- Toilet paper and paper towels
- All the soaps – laundry, dish, hand
- Cleaning products
- Small appliances and furniture
It honestly covers a lot of basic living expenses and I personally don’t want to track each of these items individually. It seems like too much. I’ll say it again, make your budget work for you by personalizing how you categorize your expenses. You might be somebody you likes having a separate budget category for each household expense.
We don’t budget a single dollar for medical expenses. When medical expenses pop up, like a medication or doctor appointment, we pay for it out of pocket or get reimbursed through our HRA.
You could also pay for medical expenses with an HSA. If you want to learn more about a health savings account, check out this Starship HSA review and see if it’s a good fit to help you pay for medical expenses and get triple tax advantages.
If you have monthly medications, this is a great place to track them with your budget.
We haven’t always had a clothing section in our budget. But over time we realized we value updating our wardrobe even in small ways, so we added it back into our budget. It’s $50 total, for both of us, so it doesn’t buy a lot. But it adds one more layer of flexibility in our budget.
If we were really strapped for cash, this would be one of the first budget categories to go. Once again, your budget is all about being intentional and should always focus on your biggest priorities. If that’s clothes, make sure it’s in your budget!
A lot of money goes into childcare, and depending on how you do your budget, this could be one of your biggest expenses. The biggest chunk of money you’ll spend is for daycare. We’re really lucky and our daycare is only $600 a month. That’s INSANE! If you live in a high cost of living area, this is going to be MUCH higher.
You can also add in childcare expenses like diapers, wipes, baby clothes, and babysitting expenses into your childcare budget category. Another good strategy for all the extra kid expenses is to try to fit them into other budget categories to save money.
For example, you can fit baby clothes under your clothing budget without making a completely separate budget category. A lot of baby supplies can also fit under a general “household” budget category with items like soap, shampoo, cleaning products.
One of the best decisions we made was to buy all of our vehicles with cash so we can live with no car payment. We’ve saved THOUSANDS of dollars over the years and have been able to use car payment money for our savings goals instead. But if you currently have a car payment, you can add it to your free debt snowball spreadsheet to help you pay it off faster and be closer to being debt free!
This is an unavoidable expense, but you can still save money on your car insurance. When we first got married we decided to pay for car insurance for 6 months at a time instead of monthly. You’ll save money and develop great savings habits.
Our favorite way to track this is with our Sinking Fund Tracker. We divide our total car insurance by 6 and transfer that money to savings every month. That way we know we’ll have enough to pay for car insurance in one lump sum.
Putting gas in your vehicles is such a flexible expense and depends a lot on how much you travel each month and how long your commute is. If you’re not sure how much you should budget for gas each month, look back at your bank statements or budgeting tool like Tiller Money. If you don’t want to do that, you can always make your best guess.
My first budget I planned $200 for gas. It turns out that was pretty close. Some months I went over budget, and other months I was way under. It might take a few months, but you should be able to figure out a decent average dollar amount you plan to spend on gas.
And always remember, budgets are meant to be flexible. If you need to increase your gas budget because you travel a lot to visit friends and family, that’s perfectly fine. Just remember to lower expenses elsewhere to offset the extra spending, especially if you’re using a zero based budget.
If you don’t have a pet, skip right along to the next budget category. We have two dogs who eat a bag of dog food every month and half or so. We budget $100 a month for dog expenses, which covers food, toys, flea treatment, and treats.
The other big pet expense for us is dog sitters. We don’t always like to travel with our dogs, and sometimes it’s impossible. So we found a few good dog sitters who LOVE to snuggle our dogs and we use our dog budget to pay them. Dog sitters and vet visits are the only time we ever go over budget for our dogs.
It might also be a good idea to stick a little money in a pet sinking fund. It’ll help pay for vet bills, pet sitters, or small emergency pet expenses.
For most people, you can put a big $0 in your education budget category. But for us, we’re both teachers and set aside a few dollars every month for lesson plans from Teachers Pay Teachers and lab supplies for my wife’s chemistry lessons.
It’s frustrating and annoying that we have to pay for classroom supplies out of pocket, but we want a realistic budget that reflects what we ACTUALLY spend money on. I’d rather budget the money and not use it
This is a HUGE priority in our budget. We first started investing for retirement about a year after we got married, in our late 20s. And we started small at $50 a month each to invest into a Roth IRA. It was $500 to open an account, and we set up an automatic withdrawal from our checking account.
As our income has increased, we’ve increased our monthly contributions to help our retirement accounts grow faster.
Automating the process has made investing into our Roth IRA seamless and simple. I just log it into our budget every month, and let it grow with compound interest.
If your employer offers a 401k, I HIGHLY recommend investing into it. And a lot of employers offer a company match if you contribute a certain percentage, which means you’re getting FREE MONEY. Do whatever you have to do to invest up to the company match.
As teachers in Minnesota, we’re required to invest money into a Teacher Retirement Association (TRA).
Life insurance is an expense you hope you never need to use. But I also don’t want to leave my wife and daughter behind grieving AND missing a big chunk of our income. We have a cash value whole life insurance policy and term life insurance.
If something happens to me, we have enough life insurance coverage to replace most of my income for a lot of years. That means my wife won’t have to stress about money to cover our basic expenses.
Our entertainment budget covers really specific spending categories. It gives us a lot of flexibility to include our hobbies and social priorities into our budget, which we love.
Here are a few expenses that fit under our entertainment budgets:
- Community (hanging out with friends)
- Blogging (yep, gotta spend money to make my blog run)
- Summer volleyball league
- Sporting events
These are all important to us, especially going on dates and spending time with friends. Each of these is a separate budget category in our annual budget spreadsheet, but for simplicity sake I lumped them all into a general entertainment expense category.
When we got married, we set a goal to pay off $100,000 of debt in 5 years. And with a lot of effort, extra jobs, and intentional budgeting we did it. Our debt snowball spreadsheet helped give us a vision and realize that our crazy goal was totally possible.
You can split this up a couple different ways in your budget. In this example budget, I lumped all of our total debt together AND extra debt payments. When you’re paying off debt, making extra payments will help your debt snowball accelerate your debt repayment and help you get out of debt faster.
If you’ve got a lot of debt, check out my Debt Free Playbook, designed to help you organize your debt and pay it off ASAP.
If you have extra money at the end of the month, making extra debt payments is a perfect way to use your money. One thing we did was split extra money between debt and savings so we learned how to save money while in debt.
Another budgeting non-negotiable for our family. Since a budget is a reflection of your values and priorities, we knew it was important to always tithe and give some money away.
At a bare minimum we give away 10% of our income as a tithe. We even tithed while in debt, and it’s become one of our most popular blog posts.. It might seem like a lot of money to give away instead of saving or paying off debt, but it was and still is absolutely worth it to practice generosity and tithing.
In this example budget, we actually tithed MORE MONEY than we spent on debt payments. And we STILL paid off all $100,000 of debt in 5 years.
Who said allowance is just for kids?
When we started giving each other a personal allowance, it transformed our budget and our entire mindset about budgeting. It created freedom and flexibility in our budget like nothing else could.
Here’s how it works.
You set aside a specific amount, say $50, that you can spend guilt free however you want. This is especially great for couples. I never have to check in with my partner on how I spend this $50. I can go out for coffee, buy new dungeons and dragons dice, or save up and splurge on the latest Jordan shoes.
Our personal allowance has fluctuated between $25-50 for our entire marriage. It doesn’t need to be a lot to provide freedom and flexibility.
Miscellaneous and Flexible Spending
A good budget has built in flexibility because you can’t predict your monthly expenses. Some months random expenses pop up. Instead of forcing yourself to cut expenses in another budget category, a miscellaneous spending category helps you weather small, extra expenses.
A great example is getting invited to a birthday party for a friend. You might not have budgeted for going out to eat or buying a gift, but a miscellaneous budget can swoop in to save the day.
Setting Up Your Budget
When you sit down to start a budget, take time to think about your biggest goals, values, and priorities. Those expenses absolutely need to be reflected in how you spend your money every month. And I hope this budget example helps you do that.
Remember, there’s no perfect budget, even if you look at 50 examples of budgets. Take what works for you and adapt it.
If you need a starting point, grab a monthly budget spreadsheet or annual budget spreadsheet for $5.
A great next step is to read about why I love this monthly budget spreadsheet and use it as another example budget to help you get started in your own budgeting journey.