How to Budget Your Household

Calculate your combined income and average monthly expenditures for your household budget.
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You may need to make a few sacrifices when planning a household budget, now that you are hitched or living with your partner. Guys, forget the nightly excursions to the local watering hole. Ladies, you may choose to settle for a half-dozen pairs of shoes per year instead of owning every color shoe under the rainbow. Creating a budget for two people takes time and commitment. You will also have to occasionally adjust your household budget to make it work.

Step 1

Get out your latest pay stubs. Calculate how much you and your partner earn per month. Place all of your monthly bills in one pile.

Step 2

Make a list of your monthly expenses. Divide your monthly expenses into fixed and variable expenses, as recommended on the worksheet. Write down fixed expenses, such as rent, car payments and insurance, for example. List variable expenses, such as both cell phones, heating, clothing and gas expenditures. Disregard the $125 you spent for a Swedish massage last month. Scan last month's expenses in your checkbook to figure expenses for which you are unsure.

Step 3

Subtract all of your expenses from your income to figure your potential savings or losses each month. Plan to cut your monthly budget if your expenses are too high, which they sometimes are.

Step 4

Purchase budgeting software for your computer. Install the budgeting software. Read the tutorial in the budgeting software so you better understand how to use it. Enter your monthly expenditures into the budgeting software. Look for monthly expenditures that may exceed the averages for that particular expense. Study the budgeting software's recommendations for grocery expenditures, for example, which should perhaps be 10 percent of your budget instead of 15 percent.

Step 5

Adjust your monthly expenditures according to the budgeting software's recommendations. Cut variable expenses such as entertainment, shopping and dining out, including that six-pack of beer you drink every Sunday during football season. Pare your expenses down so you can save or invest the amount you desire.

Step 6

Set your new monthly budget in your budgeting software and on paper. Keep close tabs on your monthly expenditures so you do not exceed your budget. Adjust your budget if any fixed expenses increase, such as car insurance. Cut back on other expenses if you want to maintain the same monthly budget with the additional expense.

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