How To Make A Stress-Free Household Budget And Actually Stick To It

by Team Scary Mommy
Originally Published: 
how to budget
Peter Dazeley/ Getty

Running a household is like running a company: you can’t just wing it when it comes to your finances. As tedious as making a budget sounds, it’s actually really important for your family’s financial well-being. In fact, according to the latest online search data available, nearly 4,400 people search for how to make a household budget on a monthly basis. So if you’re not sure where to start, you’re not alone. In order to figure out how much money you can spend each month — on everything from food, to entertainment, to car payments — you have to know how much money is coming in. In other words, you need to know how to make a budget.

RELATED: How To Budget In College: A Crash Course In Managing Your Money

If you’ve never done it before, and are not sure how to make a monthly budget, it’s actually not as hard as you think. Or maybe you were good at making and sticking to a personal budget, but now that you have a family, you have a whole household budget to consider, and that presents a challenge. And if you do already know how to budget (mazel tov!), that doesn’t mean you necessarily know how to stick to a budget. Unfortunately, all the spreadsheets in the world won’t help if you’re not actually taking what you’ve learned from creating your budget and putting it into practice to use your income more responsibly. So whether you’re new to the process or an old pro, here’s how to make a budget and actually stick to it.

Step 1: Write Down Your Income

First things first: make a list of all your take-home reliable monthly income sources. This includes everything from the wages from your job, anything you make from side hustles, alimony, child support, and any other steady stream of money you have coming in on a monthly basis. If you are self-employed, or have an income that differs from month-to-month, try to come up with an average income and go from there. Typically, a Google Sheets spreadsheet or Microsoft Excel file should work for this, but if you’d like to get fancy, there are plenty of free downloadable spreadsheets and worksheets available online. This may seem like a lot of hassle, but once you learn how to make a budget, your financial life will be much easier — or at least more organized.

Step 2: Add Up Your Essential Fixed Expenses

Now that you know what money you have coming in, figure out exactly how much is going out each month. Start with the fixed expenses. Things like rent, mortgage, car payments, credit card debt, insurance and student loan payments go in this category. These are essential expenses that are the same every single month, and rarely vary. This is not where you would list your electric bill, groceries, or even gas costs as they change so much month to month. Remember, even an extra $100 in expenses can tip your budget one way or another.

Step 3: Add Up Your Essential Variable Expenses

Next comes the bills that you know you’ll have every month, but the exact amount changes. These are essential things like utilities, food, household expenses, gasoline, medication, public transportation, shoes and clothing. Then assign each category a specific amount based on your past experience, rounded to the nearest $10.

Step 4: List Nonessential Expenses

Not every expense is something that comes up every month. In this category, make a list of some of your nonessential expenses, like entertainment, vacations, your holiday budget, eating out and hobbies. If something needs to go from your budget, it’ll come from this category.

How much should you budget for entertainment?

You may think that entertainment is the unfortunate first victim of making a budget, but you don’t have to give up on it completely, merely adjust it. Per Quicken, you should budget about 5 percent of your income to entertainment expenses, that can be adjusted accordingly depending on your household income and size.

For an annual household income of $72,000, you should budget about $300 a month to entertainment. Between Netflix and Disney+ subscriptions, that can add up super quick, so think outside the box and take advantage of free activities and events in your area. Check out your local library for kid’s events, make use of national public parks for hiking and other nature trails, and find movies in the park for fun family outings.

Step 5: Calculate Your Net Income

Now that you know what’s coming in and going out, figure out how much you’ll have left each month once all your bills are paid. Add up all of your monthly expenses and subtract it from your total monthly income. Ideally, the resulting number will be positive. Either way, write down that number.

Step 6: Adjust Your Expenses

If the number you came up with is negative, it means you’re going to have to adjust your budget accordingly by making some cuts — starting with the nonessential items. Not sure where to start? “Evaluate your spending using a ‘wants vs. needs’ analysis,” The Balance reports. “Reduce or eliminate spending in those ‘want’ areas to make more room for the things you need’ to spend money on.”

Ways to cut back


You need internet for work and school. Do you need six ESPNs? If you’re trying to dig yourself out of a hole, this is usually the best way to do it. Think of it as temporary. If you can replace that $75 cable bill (that’s conservative) with $25 for Hulu and Disney+, you’ll save $50 a month. Supplement with YouTube and an OG antenna. Sports Is your kid on “elite” teams instead of school, community or YMCA teams? The cost difference is considerable. Again. This doesn’t have to be permanent. They might be skilled athletes, but if they’re not in it for the long-haul, it’s really not worth the extra money. Cell Service We’re not suggesting you get rid of your cell altogether. But, can you lessen your bill? Most families don’t actually need “unlimited” plans. If you’re mostly scrolling while sitting at home or work, you can use your WiFi. Also, check out providers like Mint. If you pay for three gigs of data, you aren’t cut off or charged more after you hit 3.1 gigs. Your browsing is slowed. That’s not a big deal if you’re using WiFi, anyway.

Step 7: Track Your Spending

Now that you have a budget, keep track of your expenses every day. Yes, every damn day. It may sound extreme if you’re new to budgeting or are just too busy with work, kids, and life in genera, but it’ll help you get a better idea of exactly how much money you’re spending. Compare your budget to your actual expenses and make any adjustments necessary.

Not sure how to stick to a budget and where to start keeping track of your expenses? “Take notes and research ways you’ll be able to do even better next month,” according to Women’s Day. “At month’s end, add up your actual spending and compare it with what you planned. Use this information to create the next month’s spending plan.” Ideally, you’ll get into a regular cadence a few months down the line and will have a better understanding of your family’s financial needs and goals.

Step 8: Look Into Budget Apps

Tracking your spending every single day when you’re also balancing work, life, kids, and everything in between is easier said than done. Thankfully, you can outsource the tedious part of this to a handy app on your phone. Luckily, there are a ton of free or low-cost budgeting resources out there for you to choose from. You just have to find the one that works best for your lifestyle and needs.

Here are a number of the most popular ones:

Mint: The Mint app is extremely user-friendly and works great for couples who want a budget app they can use individually as well as for the family. According to The Balance report, “Mint automatically categorizes transactions from linked credit and debit cards and tracks them against a budget you can tweak and customize to your needs.” Mint is free to download and use.

PocketGuard: PocketGuard is like your own personal financial consultant right in your pocket. Per Nerd Wallet, PocketGuard “crunches the numbers to show how much money is available after accounting for bills, spending and savings goal contributions. All users can view how much money is left ‘in my pocket’ for the day, week or month. PocketGuard is also free to download and use.

GoodBudget: Using back-of-the-envelope math, GoodBudget allows users to apply a budget to specific categories like transportation and food. “As the month goes on, you can take money out of each envelope for each expense,” Forbes reports. “Stop spending in that category once you’ve emptied the envelope–or before, if you’re smart.”

This article was originally published on