Recently a tragic event in my local community has brought to my attention that not as many woman as I thought, have a say or any control of their own personal or family finances, which I have taken for granted. I am fortunate enough to be in an equal relationship where mutual respect and appreciation is a key to the survival of our marriage.
My husbands preference is to not see the bills as they come in and fall due, as this impacts his anxiety and usually keeps him awake at night, so early on in our relationship our accounts were joined and I took over running the daily ins and outs of our finances.
So today I am sharing with you the best household budget worksheet, which I’ve set up! And we are going to discuss how important it is for you to have your own household budget and have some input into the family finances, which should be of mutual benefit to you and your partner.
The purpose of a household budget worksheet!
A household budget should be in place to avoid living pay cheque to pay cheque. With so much debt in society today and the threat of interest rate rises, the potential for all this to negatively impact on your families ability to meet its financial obligations is real.
For example if you only pay the minimum repayments on your mortgage and don’t have any savings at the end of the month, how are you going to afford any interest rate increase if they go up? Similarly, if you are renting, are you happy to rent forever?
Or do you have a longer term goal of owning your own property? Do you dream of travelling, or have an item you are saving for?
How do you know how much you will need to put away to reach those goals?
A household budget worksheet setting out your monthly in’s and out’s from a monetary perspective will be able to set you on the path of meeting these goals.
Putting a budget in place allows you to see all the wages, salary and any other income items you get in a set period depending on your pay cycle. Then when comparing that to your expenses in the same cycle, whats left after you take the expenses away from your pay will show the excess you could potentially save in that period, or highlight any shortfall you are somehow going to have to make up for.
My family budget is done on a monthly cycle as both our pay cycles are on a monthly basis, which means we need to be pretty vigilant with our savings! We both get paid on the 15th of the month and it looks like all our Christmases have come at once, but without tracking our expenditure on a weekly basis, by the time the 30th of the month comes around we would be living on fresh air if it weren’t for a budget.
Separate or Joint Bank accounts?
I am not going to tell you how to run your finances, these are decisions that need to be made mutually between you and your partner. I underline the word mutually because you both need to have input into how your family finances are run. If a decision is made to have separate accounts, make sure you are both able to openly discuss the balances and what you need money for to meet your joint expenses.
Money unfortunately means control in a lot of situations.
We are hearing more frequently in the media instances of denial of access to finances, or a partner having total control over the cash in the family.
This is a form of domestic abuse.
If you are in a situation where you have no visibility over the total cash inflows and expenses of your household, and this isn’t by your own choice, I urge you to consider the health of this relationship and seek help. Turn to a friend, email me at firstname.lastname@example.org, or if you would prefer to be anonymous please check out the White Ribbon Website.
If you are the primary carer, and perform the domestic duties, and you don’t have access to funds or need approval for cash to be spent on the day to day necessities by your partner who “earns the income” this is not acceptable.! You work hard raising those kids, you work hard keeping on top of the household duties, you do work and therefore you need access to money to meet your households basic needs.
There is a difference between needs and wants, and I learned early on in Year 7 social studies that the two shouldn’t be confused. A need is defined as something that is a basic requirement including food, shelter, warmth, clean clothing and health care. A want is something that isn’t necessary but we desire or wish for it. (I would love to have a manicure every 3 weeks, but alas this is a want and shouldn’t be confused with a need. My husband would love to play golf every week, this is a want and not a need.)
If you can’t provide these basic needs, or need to seek approval for cash to cover them, this is not a positive relationship! I know some instances where cash is dished out as an allowance, but that “allowance” doesn’t come close to covering these costs. Know your worth and know you deserve better!
In my household our preference is for a joint bank account. It makes managing the household budget a lot easier. Both our wages go into this account and all our expense come out of this account. Any excess we have to put towards savings, goes into a completely separate account, that we still both have access too. As I said earlier my husband doesn’t like to know what goes on with the money, but he does have one requirement and that is that money needs to be in the account. This is a pretty reasonable request, if he needs to get petrol, he wants to know cash is there. So we always keep a buffer in the account. Everything else goes into savings. We have a mutual understanding that big purchases need to be discussed, and our savings sit in a separate account so that they can’t be accessed through an ATM or by our debit card.
Setting up a Spreadsheet!
Here is my template of The Best Household Budget worksheet, which you can download it for free! Play around with it as you need, and add or delete columns that personalize the budget to your own needs. The pink columns are where you input your monthly income and expected expenses. Feel free to add or delete the description columns as you need. The total columns are formula generated, and shouldn’t need updating. (If you add a new row, you will need to sum the column at the end.)
At the moment the budget is set for monthly. However, if you feel you need to budget more on a weekly basis, feel free to personalize it to best suit your household.
If we look at it, the top rows reflect all monthly income, including, wages, rent income, investment earnings, other earnings. And this is subtotaled to represent the total income expected for the month.
Now for the expenses, and this can be a little harder especially when starting out! I have listed the most common items, and what we use in our household. This includes, annual insurances, mortgage repayments, car repayments, monthly groceries, school expenses and extra curricula expenses. These descriptions can be amended, so make it your own. Each column is subtotaled down the bottom to show you the expected monthly outgoings.
Budgeting for expenses gets easier over time, so don’t expect to perfect it straight up. If you know you spend $200 a week on groceries, put that $800 in for the month. Then at the end of the month go through your bank account statements and see where you money went. This will enable you to see what your actual expenses where versus what you thought they were.
If you pay your gas and electricity quarterly, put in the average quarterly expense based on your experience, then adjust as you need too.
Once you take away your income subtotal from your expense subtotal, you will have either a positive figure, this will be excess that can go towards savings, or you may have a negative figure which means you need to somehow cut some expenses for that month and tighten the belt, or dip into the savings you have from previous months. A good example of when the budget shows you may fall short is when insurances and registrations are due, these are big lump sums that happen once a year, and if input correctly you will know when to expect them and so savings from previous periods will be used to cover that month of negative spend.
Below this positive or negative figure is the balance of total cash in your bank accounts. This will be NIL if you have no savings to begin with, but hopefully with time and use of the spreadsheet you will see this figure increasing. This figure needs to be updated at the end of each month to accurately reflect you actual cash savings position, and should agree to your total bank accounts with cash in them, to truly reflect what you have saved (or haven’t saved.)
Check in regularly!
A household budget isn’t something that is set and forget! It needs constant maintenance and updating to work properly for you. Particularly when you are getting used to it and gaining a feel for what goes in and how often certain expenses occur, e.g. rates may be quarterly, insurances annually. At least look at it in line with your pay cycle and update appropriately to make sure its accurately reflecting your e households situation.
Then choose a point, say at the end of the month, to true up your budget. So for example if you had your budget set for June, and expected a savings of $1,000 did this in fact happen? Or did you only save $500? Was there school excursions that came up unexpectedly, or some household maintenance that was urgently required. Then match this back to what is actually in your cash accounts. So at the 30 June did you bank account reflect a cash position of $3,000 savings from last month plus the $500 from this month with a total cash savings at 30 June of $3,500.
My budget attached above, has this running line so that you can project your savings, but also allows you to monthly true it up, and see what you are saving as the months tick by. Its the variance at the bottom which will show how much you were out by, and depending on how big this variance is, you may want to check it out further.
Take control and get budgeting!
To take control of your own personal wealth you need to plan for it, and you do that through budgeting. If you currently have no control over the finances, become familiar with my spreadsheet, play around with it, do some modeling and then sit down with your partner and show them how budgeting can benefit both of you in the long run to achieve some goals you have set. The spreadsheet could show you that within six months you could save enough for that holiday you deserve. By working together on the household budget you might find you both actually enjoy doing it and work towards achieving something financially together.
If you do have access to the cash, but you don’t know where it all goes by the end of the month, itemizing the expenses as per the Mumsonline spreadsheet, will tell you exactly where the money goes, and you will be able to see that maybe those monthly nail/hair appointments are costing you those few extra gifts at Christmas the kids are asking for.
Having a budget can only benefit your household, and although finances can be stressful on many families maybe working together on a budget will help improve your personal relationship, and also your relationship with money!
So what are you waiting for? Download the spreadsheet and get budgeting!!
I’d love to know how you went with the spreadsheet and hear any feedback, so please feel free to comment below.
If you have realized that you need to top up your income with some side work, check out my article on how to earn money and work from home these might just be some options that can help you out.
If you run your own small business check out why you should undertake a SWOT analysis here and see how it can help you with your business strategy.