Putting Together a Budget: Part I

Salam 3alaikum sisters,

I had a request to show how I put together the budget for our house. A budget is definitely an ongoing process and needs to be adjusted each month. This first post is going to cover how I first developed the budget.

Step 1: I bought a ledger book to keep track of our finances. I bout the one called "columnar pad" from Wal-Mart. It is not available online but you should be able to find something similar in most stores that carry office supplies.

Step 2: Write down how much I THINK we spend on each category. My categories included:

• Rent: monthly for our apartment 
• Electric: our only utility payment, but you may also have water and gas 
• Comcast: internet bill
• Insurance: car insurance is required
• Phone: our cell phone bill
• Car Gas: gasoline, monthly average, you may have a car payment as well
• Food: include groceries and eating out, I keep note of restaurant amount as well
• Fun: like travel, movies, etc
• Netflix: monthly fee
• Gym: monthly fee
• Clothes: new clothes budget
• Laundry: detergent, dryer sheets, and coins for machine
• Heath and Beauty: medicines, make up, shampoo, conditioner, etc.
• House Items: organizational, decorative
• Savings: we are trying to save a certain amount each month

I put the name of the category in the first column then the amount I thought we would spend in the second column. You may have more or less categories than this.

Step 3: Track actual spending for a month. I keep all of our receipts together and every few days I update out budget. I separate each receipt into categories and keep a running total for each category. At the end of the week I check the bank statement online to make sure I didn't miss any receipts.

At the end of the month I will toss out all the receipts except those that I might need for warranty or return purposes. 

Step 4: At the end of the month, add up all your spending totals and compare to the predictions at the beginning of the month. This will give you a better idea of how you are actually spending your money versus how you think you are spending it. For example, we estimated the first month that we would spend $300 on food and we actually spent closer to $400. That is a big difference... 

Step 5: Use your actual spending to estimate your next months budget. Where can you add and where can you take away? For example the next month we set our food budget at $350 and made an effort to eat out less often. 

Note: Don't forget to add one time expenses into your monthly budget. For example you may know that this month you will need to change the car oil, maybe your husband needs a new pair of dress shoes, or you need to pay your zakat. Go ahead and add that into the budget at the beginning of the month so you can be prepared for the expense.

In part two, inshaAllah I will talk about some other budget options that may work better different situations.

Home Management Binder

Salam 3alaikum girls,

I am in the middle of putting together a "home management binder" to help me organize all of the papers and schedules and information floating around my house.

Right now, I am just putting together things from around my house (free, yay!) to create a makeshift binder until I figure out how much use I will get out of these binders before investing more permanently.

So far I have 2 plastic brad folders and one normal plastic folder.

The brad folders look like this:

{via amazon.com}

One brad folder holds our receipts, budget, goals, account info, travel plans, and calendars (school, cleaning schedule, tv shows lol). It is green, like money O_o
The second brad folder holds online shopping account info, meal ideas, coupons, recipes, the grocery list and store ad flyers. It is orange... like an orange. Yes I'm so creative.
The normal folder holds our apartment info, lease agreement, and documented contact with the landlord/maintenance staff, and emergency information like family addresses, phone numbers, doctors names and numbers, etc. It is purple. Because I had a purple folder.

Along with normal notebook paper I am using a few plastic page protectors and some binder clips to hold lists and receipts and such I also have some tabs for the sections. Coupons, grocery lists, and calendars are stored in plastic pages. I have some plastic pages also to store any recipes I come across in magazines or online. I can just clip or print them and shove them in the book for later.

The 10 colored tab pages, 16 plastic page protectors, and 8 binder clips of varying size were $3 total at the Dollar Tree, so it really wasn't a big splurge to get this party started. Everything else I had laying around the house.

When I get a good system going inshaAllah I plan on adding more "official" printables instead of drawing all over notebook paper. Also I may buy a real binder.

Would you all be interested in my sharing the printables here? I know homemaking binders are becoming more common.

I think the first one I will make will be for my cleaning schedule inshaAllah. Right now I have it all written on scrap pieces of paper and stuck in the binder which isn't very helpful.

Do any of you use a homemaking binder to keep organized? Do you use some other method? I would love to hear about it inshaAllah!