How to make a budget spreadsheet​

Well, okay. Maybe “exciting” isn’t quite the right word, but the humble spreadsheet is still one of the most effective ways to get your budget working for you. If you don’t already have one you’re comfortable with, there are plenty of spreadsheet options on offer. A lot of them even have built-in templates specifically for managing a budget. Microsoft Excel and Google Sheets, for instance, have a range of set-ups to help guide your budget-building in the right direction.

The main thing to realise up-front is that setting up a spreadsheet to handle your budgeting really isn’t nearly as difficult as it might look. You won’t need to study up and become a qualified computer geek to stay on top of your financial plans. What you will have to do, though, is make a few basic decisions from the outset.

The first thing you’re going to want to do is choose whether you’re making a weekly budget or a monthly one. Basically, this is going to come down to the way you’re paid. Weekly budgets make more sense if you’ve got weekly wages than if you’re paid at the end of the month, for instance. If that sounds obvious, it probably is – but remember that it might not just be your own finances you’re budgeting around.

That brings us neatly to the next thing you’ll need to consider. Is the budget you’re making only going to include your own income and spending? If there’s another earner in your household, it’s a pretty good idea to include their information in a combined budget. This, naturally enough, could easily effect your decision about budgeting weekly or monthly. If your partner’s paid by the week and you’re paid by the month, for example, it might make sense to make your budget a weekly one.

With those initial decisions squared away, it’s time to start entering the key details. The first things to look at here are your bank statements, whether you get them on paper or digitally. Your statements are some of the most important budgeting tools you’ll ever have, so it pays to keep track of them.

Most of the information you’ll need can be found here. Note down all the income covered in your statements, wherever it comes from. What you’re really looking for here is the money coming in that you can count on regularly. We’re talking about wages, pensions, rent payments (if you’re making any extra cash by letting out a room or property) and any benefits you’re getting. If you’re self-employed, on a zero-hours contract or have an irregular income for any other reason, this can sometimes be a challenge. In that case, you’ll often find your best bet is to average out your income over 3 to 6 months’ worth of bank statements. Once again, your banking paperwork comes to the rescue!

Now let’s take a look at the other half of your budget: your regular spending. Start out with the costs that you really can’t do too much to bring down. We’re talking about your rent or mortgage repayments, Council Tax and other essentials like energy and water (although there are a few ways to help with those – see our guide, “6 Easy Ways to Save on Gas and Electric Bills” for more). Once you’ve got those sorted, move on to your other regular expenses, like transport costs (whether that’s petrol, public transport tickets or both), grocery bills and any medical costs you’ve got, like prescriptions or private health insurance payments.

Next up, give some thought into the spending you’re doing on a less regular basis. This is where you record the cash you spend on one-off emergencies, repair bills and so on. This kind of spending can be difficult to account for – but again, averaging the numbers based on what you’ve splashed out in previous years is a good start. For costs that crop up only once a year or so, feel free to divide them by 12 when you slot them into your monthly budget, to keep things nice and simple.

How to save money on your energy bills

That’s pretty much your basic budget in a nutshell. The important thing now is to make good use of it. This is going to sound pretty obvious, but the main goal is to keep your spending lower than your income. If you can’t do that, then you’re going to be running up debts over time. When the balance of your budget seems to be tipping that way, it’s time to start looking for ways to either boost your income (like renting out an unused room, for instance) or to cut back on your spending. Look a little closer at those expenses you’ve been recording to see if there’s anything you could prune back enough to balance things out.

If you can get yourself into a position where you’re spending less than you’ve got coming in, you can start planning out a strategy for saving money. Again, your budget is a great help here. The trick to saving is to make a habit of it. Putting a little aside every month is generally a lot better than dumping in a big chunk of change only once in a while, particularly when you’re trying to plan ahead. The more consistent you are with your saving, the easier it’ll be to see it stack up - even if the monthly amounts aren’t huge. Most importantly, remember to include your savings in your budget spreadsheet. That aim is to record where every penny of your income is coming from and going – whether it’s spent, saved or given away. It’s called a “zero-based” budget, and it’s an incredibly valuable tool.

Free budget planner