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May 1, 2020 · Leave a Comment

How To Complete A Budget Review

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Budget· Budget Tips· Debt Free· Debt Free Tips· Saving· Ways We Save

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Reviewing our budget is a crucial step to making sure we are on track with our financial goals. Whether you are paid weekly, biweekly, or monthly, if you want to make sure you are achieving your financial goals, reviewing your budget each paycheck is a must. Here are the four simple steps I use to complete our budget review

How To Complete A Budget Review

Before you get started on reviewing your budget, it’s essential to have a budget set up in the first place. We follow a zero based budget by paycheck using this ultimate budgeting workbook.

How To Complete A Budget Review

By completing a budget review, we know if we have stuck to our budget or if we overspent. But going a step beyond that, performing a budget review will help you know how to adjust your spending for the following paycheck, and help ensure that your spending aligns with your financial goals.

Determine Your Actual Expenses

We set up our budgets with the best intentions of how we plan to spend our money. But not everything goes according to plan. Sometimes there were extra expenses we just didn’t see, other times we had spent well below what we allotted in a specific category.

How To Complete A Budget Review

To determine your actual expenses, go back through every single one of your expenses throughout the course of your pay period, and add them up by category. To learn more about the method I use, you can head over here to read more about how to track your expenses.

The biggest difference between how we use our expense tracker and the more traditional use is that I add up each category individually and color code our categories using these Stabilo Highlighters* for fast category identification.

Once you have an idea of how much you spent over the course of the period, compare it to what your budgeted amounts were. If you were over budget, look back on the expenses and determine what the cause was.

Compare Your Budgeted Amount With Your Expenses

Look back at what you budgeted for each category and how it relates to what you spent. Did you overestimate and have money left over from this category, or did you overspend and have to pull from other categories? Reflect on which way your spending went and why.

The why is the biggest part here. As I’m reevaluating expenses for the next month, I want to know if there was some weird fluke – like social distancing measures – that can explain why I only spent $68 of our fuel category and not the $300 I would normally spend in fuel costs throughout the month.

Re-Calculate Your Budget With Your Actual Expenses

Go back to the zero-based budget you set up. Even if you overspent in certain categories, don’t get discouraged.

First, it can take between 3 – 6 months before you get the budget just right.

Secondly, just because you overspent in some categories doesn’t mean that you overspent on your budget overall. Yes, sometimes this is the case. But it isn’t always the case.

Run through your paycheck budget sheet again, this time with the real numbers. How did you end up for the month? Did your spending help you towards your overall financial goals?

How To Complete A Budget Review

What If I Overspent?

Evaluate why that might have been. Some months it seems that Murphy’s Law is just hitting in full force and we’re doing all we can to stay afloat. It is perfectly fine to feel overwhelmed during this time. Take a breather, and look at your next budget as a fresh start.
If the extra expenses were things you could have budgeted for, now is the time to make note of it so that you are better prepared in the future.

Rather than taking from any savings that we have set aside for various sinking funds and any savings goals we are trying to reach, I take the amount we overspent off the top of the next paycheck. So if we overspent one paycheck by $200, the next paycheck we get I am budgeting it with $200 less than what we actually receive to make up for that overage.

How To Complete A Budget Review

What I Underspent?

If you underspent, it’s a little simpler. That extra money can go towards any financial goals you currently have, whether it’s reaching savings goals, investing, or paying off your debt.

Re-Evaluate Your Spending With Your Budget

The final part of a budget review is to determine whether you need to adjust your categories for the following month.

Look to see if there are any changes you can make to your budget for the following month, and how those changes can help you achieve your overall financial goals.

If you find you are consistently overspending on food, try to evaluate why. I am more likely to increase my grocery spending when I’m over budget from feeding two teenaged boys versus spending more on groceries because it was a busy month and I wasn’t paying attention to what we had on hand each week and shopping from my pantry first.

If the opposite is true, and you are spending less than you budgeted, run a test month where you budget less in that particular category. Circumstances change, as do spending habits, and in the end, it is better for that extra money to go to your next financial priority.

Finally, check your calendar to see if there are any upcoming expenses that you need to start budgeting for now.

How To Complete A Budget Review

To See How I Perform A Budget Review

For those of you that are curious, I showed how I walk through a budget review on my YouTube Channel. You can see it here:

Do you perform a budget review? What are some steps you include in your budget review that I didn’t cover here? Let me know in the comments below!

How To Complete A Budget Review

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makingcentsmatter

makingcentsmatter
Payday is today! Actually, payday was Friday the 1 Payday is today! Actually, payday was Friday the 12th because we completely forgot today is a bank holiday in the US. The feeling of being paid and not needing it is a nice one.⁠
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Here's what our paycheck needs to get us through for bills until March 14th. For a full look at our budget over the next month, head over to my budget with me on YouTube: https://youtu.be/rb8uyi1-rNc⁠
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#monthlyincome #monthlybudget #monthlybudget #zerobasedbudget #payday #budgetwithme #budgeting #budgettips #budgetcalendar #frugalliving #savingmoney #paycheck #makingcentsmatter #debtfreejourney #debtfreeprogress
This weekend was focused on a pantry shop and meal This weekend was focused on a pantry shop and meal plan creation! This meal plan to get us to our February payday. We also picked fast meals, because it's a busy two weeks between doctor's appointments,. Academic Decathalon, dance, and drama. I'm unsure we'll be able to shop on payday, hence the extras.⁠
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Total spent: $112.39 for items to get us through this and lunches.⁠
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Keep in mind, just over $112 for 12 meals isn't sustainable for our family, just in times when we need to stretch the last bits of our monthly income. I really wish $112 was enough to feed two teenaged boys in our household.⁠
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The point being... do what works for you, and your situation based on your location. Don't try to fit yourself into someone else's situation!⁠
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#mealplan #mealplanning #frugalliving #frugalmom #makingcentsmatter #savingmoney #monthlyincome #budgeting #budgetmom #groceryshop
January's real numbers:⁠ .⁠ House: $511.13⁠ January's real numbers:⁠
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House: $511.13⁠
Citi: $720⁠
D NelNet: $100⁠
K NelNet: $100⁠
K Chase: $150⁠
Explorer: $343⁠
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Extra Payment to Citi: $500⁠
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Noteworthy... our car payment had a late fee assessed because the mail was SLOWED down over Christmas. Three headaches later, and we potentially have online banking finally set up with them. It is still a headache. And we are never taking another car loan out with this bank!⁠
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How was January?⁠
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#makingcentsmatter #debt #debtfreejouney #debtfreeprogress #debtfreecommunity #realbudget #savingmoney #savings #frugalliving #frugalblogging #budgeting #monthlyincome #zerobasedbudget #financialgoals #personalfinance #personalfinancetips #financialfreedom
Sometimes in order to see progress, you need to ta Sometimes in order to see progress, you need to take a step back.
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I'll be honest, I didn't think that we got this far in 2020. With everything going on - and more importantly, everything NOT going on - we didn't keep up with this every month. We just threw what we could at our goal. I'm simply amazed at how far we came.
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Things are still hectic, and I'm simply mentally exhausted between remote learning, extended remote learning, offset quarantining children... it goes on and on.
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But I also cannot wait to see what strides we will make in 2021.
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#makingcentsmatter #debtfreejouney #debtfreeprogress #savingmoney #savings #frugalliving #frugalblogging #budgeting #monthlyincome #zerobasedbudget #financialgoals #personalfinance
This is what school looks like when it's a hybrid This is what school looks like when it's a hybrid model, and your house does not have unlimited space. I was standing in our kitchen when I took this picture, the kids behind me making lunch.
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Our district is carefully monitoring our local infection rates, and we are currently in a hybrid form. That means they divided the district into two groups; half are in school on Monday and Tuesday, the other half on Thursday and Friday. They are offering an all remote option, but Verizon for some reason supplies our house with speeds so slow that it would shock a tortoise. Remote was a no-go.
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This set-up has taken some trial and error to get to where we currently are. Because no matter how prepared you are and how much you've planned, once you're in the weeds, actually doing it, there is no telling how your best-laid plans will work.
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Our home is a 1800sqft one-story, open living area, 4 bedroom, 1 bathroom, ranch-style house in a very rural area. It has no home offices. No guest bedrooms. Yes, that is a desk in the corner of our dining room. 🤣
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Each kid gets their own color bin for their school work. This includes school-issued Chromebooks and other standard items they need to get work done - headphones, pencils, and so on. When we are done for the day, we clean up everything, place them neatly in these bins, and place them in cubbies (on my current left) at night while the Chromebooks charge.
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I do NOT bother to clean up at lunchtime. It would take us more time to clean up and reset everything than it takes us to eat lunch. So we only pack it all up for the day and call it done.
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During the day, I sit between my younger two and field any questions they may have, troubleshoot technical issues we all have, and be the overall bouncer when things get off-topic. My high schooler will occasionally emerge from his bedroom, which opens to the kitchen. So he is close by when he has questions.
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Please remember that with all things in life, you need to work with what's available to you. And there is no shame in that. Don't ever feel like you're not doing good enough because it's not picture perfect. Work with what you have available to you, and you'll do amazing things.
School is in session, the garden is slowing, and I School is in session, the garden is slowing, and I’ve finally realized I haven’t shared our payoff numbers for July or August. Yeah……
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Please keep in mind, we are paid monthly on the 15th, but we don’t go by a “monthly” budget. So I have to go back and look at these numbers based off their due dates in the calendar. Because our pay falls in the middle of the month, I can’t tell you what portion of our income went to debt. It’s going to vary paycheck to paycheck anyways because our priorities vary with each check. Nothing is ever the same month to month, and pay to pay.
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That said, inJuly we paid off $2,694.43.
In August we paid off $1,673.40.
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The difference here is that our priorities shifted between the two months.
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During August, we were doing more prep for whatever school would look like this year, and we had some savings goals make their way to the top of the list as well.
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Of those goals, in August we made progress!
EF Reimbursement: $146 / $1,200
Checking Buffer Reimbursement: $227 / $500
Vet Sinking Fund: $40 / $200
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Remember this is a journey, not a race. There is no point wearing yourself ragged and still making no progress. Make progress where you can, and celebrate it. Even if it’s $5.
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It’s progress, and that’s what matters!
While I wait for the canner to finish the last rou While I wait for the canner to finish the last round... I rearranged our recipe binder. It's only taken me 8 or so years. 🤣😶😭
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I miss the days when zucchini was my problem. Now it's tomatoes. I can only find so many ways to use up spaghetti sauce! So the next 50lbs or so will be chili base and unseasoned sauce.
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On top of this school is starting with a hybrid in building & online system. And I'm seriously slacking on some things I need to do. I'm not good at juggling multiple things and the balls are falling. But I keep reminding myself... be patient. This too shall pass. This is only a phase. So I pick and choose what's the most important, focus on that and go from there.
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So if you feel overwhelmed with your current phase, remember, this too shall pass. It's okay to rearrange priorities. It's okay to take a breather.
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This too shall pass.
If you didn't start finding interesting ways to ge If you didn't start finding interesting ways to get rid of the squash, can you say you even planted any?
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Good news, I'm almost caught up! Bad news, the garden has more.
Super busy here... but I wanted to share that wins Super busy here... but I wanted to share that wins can come in super small packages. I thought I'd spend $380 to clean the band instruments in this house. I ended up spending $234. So the remaining $146 can go to reimbursing what I pulled from our EF.
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No matter the win, celebrate it!
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What are some wins you have had lately?
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