Break Down a Budget

so that we can help make handling your personal finances a whole lot easier.

Breakdown Down a Budget

Chapter 3: Budget Breakdown

Real-life budgeting should be a little nuanced. We’ve not only got to consider our income and our set bills (fixed expenses) but our spending along with those expenses that don’t come up monthly.

Take a moment to watch the video and read more to construct your budget.

Video Transcript

The DNA of a Budget

There are three types of expenses to consider when building your budget. They are: fixed, variable, and non-monthly expenses. 

So, the equation from Chapter 1: How To Start a Budget really breaks down into:

Income – Fixed Expenses – Variable Expenses – Non-Monthly Expenses = Money for Goals

Plan, Plan, Plan

Non-monthly expenses and emergency funds are part of budgeting wisely. Each takes effort, intentionality, and planning. 

For non-monthly expenses: Estimate how much you need and divide it by the number of months you have to save. 

Emergency funds help you not reach for a credit card or line of credit when expected events hit. They help you keep enough cash on hand to cover deductibles or minor incidents. For emergency funds: Try to save six to nine months of funds to cover any essential expenses. 

Your Chapter 3 Checklist:

Budgeting 101 - Changing Spending Habits Next Step

Budgeting Help for Spenders 
Once you know what those habits are, you’re empowered to change them.