How To Create A Household Budget, Templates Included

How To Create A Household Budget, Templates Included

Creating a household budget used to be a common practice within every home. People actually knew what they could afford, and how long it would take to save up and buy something. Many households were frugal, thrifty and budget conscious.

Today’s financial landscape is radically different. There is far less education about matters of household finances; in fact, there is every reason to believe that financial education is kept out of the education on purpose. Debt has become a way of life.  Many begin adulthood carrying debt through educational loans and it spirals onward from there. Mirroring our Governments, we are encouraged to spend well beyond our means. Borrowing money has never been easier (as the whole system would implode if debt ceased to be created!)

All of the stuff that we mindlessly purchase can become a prison sentence if we aren’t in control of our finances and focused on working our way towards greater financial independence.

The truth of the matter is, we DON’T have to live with such stress and high debt. We CAN CHANGE our mindset and habits and it begins with something as simple as learning how to create and manage a household budget.  There is no reason you have to go without, necessarily, IF (and only if) you can afford it!

Step 1: Include Your Wife/Husband/Partner/Kids

Knowledge is power so empower your family and include them in your budgeting discussions. By including them you’ll be teaching your kids how to manage financial resources, create a budget, developing personal banking skills and regulating credit card use. They’ll also learn about the financial obligations associated with renting and home ownership, making down payments, mortgages, insurance and so forth.  By being open with them about your household finances, It will most certainly give them an edge on adult life while also giving them a stronger sense of responsibility and respect for your families finances.

Step 2: Track and Audit your Spending

Keep ALL of your receipts for a set period of time and then sit down as a family and go through them. Enter every single expense into a spreadsheet or a paper ledge by category. Food, clothing, toiletries, fuel, gasoline, cell phones, entertainment take out, school, etc. Once this is done you’ll want to compare it to your income.

Coming face to face with your families more “wasteful”  spending habits can be rather shocking the first time you do it. Don’t be judgemental or accusatory as you complete this exercise. Instead use this as an opportunity to work as a family and focus on setting unified goals.

Step 3: Create: Daily, Weekly and Monthly Budgets

If you want to start saving money it’s essential that you get a grip of your finances on a tighter, more detailed time scale. The first step provided you with a realistic view on how you are spending your money. Now it’s time to get a good sense of how your financial situation looks over the next day, week, month and year.

Your budget will tell you at a glance what comes in (income) and what goes out (bills and major expenses, luxuries, food, etc).

With this knowledge you can set your goals realistically and make decisions on any changes your family needs to make in their spending. Working together for a common goal can be a positive experience and you have your budget and tracking to hold everyone accountable.

What if your budget doesn’t balance?

If you’re spending more each month than you have coming in, the next step is to look more closely at where your money is going and where you can cut back. Can you downgrade plans or services? Go without your cable TV package for a while?  Of course you can (and you won’t miss it after a short, short while.)  Can you sell something? Can you stop buying expensive coffee every day?  If you are still coming up short, you might need to discuss the feasibility of finding additional sources of income, or more extreme, downgrading accommodations or vehicles.

This can be a stressful situation and it’s important to not try to shoulder the worry on your own. Talk to people you can trust and gather a team of people who can help you get on top of things.

Budgeting Tools

There are free spreadsheet tools that make budgeting  really simple. You don’t need to waste money by purchasing costly budgeting programs or software because these free and simple tools work well.

LibreOffice is a free software package that offers programs very similar to Microsoft Office (word processing, spreadsheets etc) but you can download it for free.  I’ve also linked to some pre-made household budget templates that you can start using right away. You can learn more here: Libre Office Software 

Personal Budget Template

Household Budget Spreadsheet


GnuCash is personal and small-business financial-accounting software. It is open source meaning that it is completely free to download and use.  Although it is designed to be easy to use, it does take a bit of time to learn. The software allows you to track bank accounts, stocks, income and expenses. You can learn more here: GnuCash Software

Home Bank

HomeBank is a free personal accounting software program. It can help you analyse your personal finance and budget in detail. The software offers powerful filtering tools, beautiful charts and is relatively simple to use. You can learn more here: HomeBank Software

What Comes Next?

There are so many ways to save money, spend less and still live well.  Learning how to manage a household budget is an integral part of achieving your financial goals.  It also takes a FIRM shift in habits and mindset.

We are all bombarded with messages and mindsets that are craftily engineered to relieve us of our hard earned cash.  Make no mistake: much of the money you spend (poorly) marches from your wallet to the pocket of a large corporation as the result of someone with a PhD. in Psychology who has crafted target, precise advertising.  Shake your fists and rebel against this system. You know what’s best for you and your family!  Stop feeding the beast.

If you would like some inspirations for taking your budgeting to the next level with cost saving spending strategies, read our guide: xxx

You might also be interested in reading our article on Household Budgets: Analyzing Expenses, Cost Per Day Budgeting which provides a unique view on cost per day budgeting. Knowing what life costs you at a daily level is quite an interesting exercise! Additionally, if you want to learn how to eat well on a budget take a look at How to Eat Healthy on a Budget and How to Stock a Pantry like a Pro.

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