How To Plan A Home Budget

When running a household all by yourself, if one does not keep track of how much he/she is spending, it would become extremely difficult to manage. The difficulty is compounded when we come to acknowledge that many people do not even know how to calculate their monthly expenditure and savings. Where is the money earned going, how much is it, is it a recurrent expenditure, i.e. will it be repeated every month, or is it an unexpected expenditure and will not be repeated – all such questions need to be answered. Calculating the budget not only gives an estimate of how much a family is saving, but also give them an idea of what they should do with the money that they save. Read on to know how to calculate your household budget.

 

 

Your salary slip will give you the correct estimate of how much your salary is actually being used by you for your needs. The amount that you need to pay as income tax, the amount that goes into your provident fund will be deducted from your income to give you the correct estimate of salary that you get into your account. Once you know the amount that actually comes to you, you will be able to gauge your expenditure better. If your partner is working too, his/her salary slip will also give you the exact in-hand income that he/she is getting. Add the two figures to get the exact amount of money you may have at your disposal.

 

Surely, you have a lot of bills that need to be paid – bill for the packet of milk delivered at your doorstep, for water, electricity, rent, insurance premium and so on. Add the amount that you have paid or have to pay for all these things together and deduct it from the sum total of the salaries of you and your partner. This would give you the amount that you must have used for stuff around the house.

 

After you have paid the bills, the next major source of expenditure will be the supplies that you have to buy every month or so. It will include the groceries, household supplies, toiletries, eating out and entertainment. Make sure you know the exact amount that every item costs, since this will be a major source of expenditure every month.

 

If you have to reconfigure your computer, it may cost a lot, but this expenditure will not be a part of every month’s budget. If you have had to repair your vehicle, include its expense too. Under unexpected trips come various things – like sudden trips to the native place, hospital bills, money you spent to buy a gift for someone who celebrated a birthday or got married etc.

 

These occasions arise every once in a while, thus they can neither be classified into the category of ever-present monthly expenses or much less into the category of unexpected expenses. Add the money you spent for a special function, a festival or a birthday party or a family get-together.

 

After adding the expenditures in the categories mentioned above, deduct it from your total income and you will know what you are saving. Now that you have figured out how much you are saving, maintain it and, if possible try to increase this amount.