How Do I Create an Itemized Budget?

Creating an itemized budget can help control spending by giving you a better idea of where all your money goes. If you're the kind of person who cringes at the thought of budgeting, you're not alone — and you'll need to change the way you think about budgets before creating one. Not only does budgeting ensure that you have enough money to pay for necessities, but it also can free up cash to use for savings, vacations and buying all that cool stuff you've been wanting.

Prepare a spreadsheet using a spreadsheet computer program or notebook. The spreadsheet will have multiple vertical columns for each expenditure type with horizontal rows for date and expense entries. This spreadsheet will serve as your master monthly expense list used to create your budget.

Itemize weekly, monthly, annual and occasional expenditure types, placing each in its own heading row at the top of the spreadsheet. Examples may include: car payment, rent or mortgage, fuel, dining, groceries, utilities. Don't forget to include an entry for holidays, birthdays, vacations and other expenses that occur throughout the year.

Place monthly fixed expense amounts in a row under the expense heading. Fixed expenses are known amounts that you expect to pay every month.

Estimate your annual or occasional expenses, such as gifts for holidays and birthdays, insurance premiums, tax accountant fees, vehicle registration renewals, etc. Divide the total amounts by 12 to arrive at your monthly cost, and write the result in the row under the applicable expense heading. You'll need to be creative to arrive at some amounts (such as gifts), but just be sure to put something in there.

Track your variable or unknown expenses, such as fuel, groceries, dining, coffee, beer and wine, for one month. Try to save receipts or write down daily expenditures and add them to your spreadsheet every night. You'll place each expense on its own line, starting with a date, under the column of the expense heading.

Add all expenses at the end of the month and multiply by 12 to get your annual expense report, and multiply your weekly take-home paycheck by 52 to arrive at your annual income. (If you are paid bi-weekly, multiply by 26, and so on). If your annual income is more than your expenses, that's super. If not, you'll need to revisit certain expenses and see where you can make cuts.

Create your actual itemized budget spreadsheet in the same way. By now, you'll be able to fill in each column with an amount you know you can afford. To change the annual budget to a monthly one, divide all amounts by 12. To change it to a weekly budget, divide all amounts by 52.


  • You may use budgeting software after you've created a spreadsheet if you wish to continue to track expenses.
  • It's fine to modify your budget as you go along, but try to stick with it as closely as possible.


  • If your budget is very close to what you are making, use caution and shave more off your expenses. Things may look good on paper, but unexpected emergencies can cause financial trouble.
  • Don't count on tax returns, company bonuses or gifts as income. Situations may change, leaving you in a difficult financial position.