How do I Set Up a Family Household Budget?

Set up a family household budget and enjoy being in control of your money.

Set up a family household budget and enjoy being in control of your money.

Setting up a family household budget can help you control where your money goes. Budgets don't have to be a drag on your lifestyle, and when used properly, they can actually improve it. Controlling where your money goes and learning to live within your means is one of the essential elements to living a life that is financially stable and relatively free of money-related stress. If you play your cards right, as an added bonus you may actually free up extra cash for doing things and buying stuff you may not have been able to afford before.

Prepare an annual budgeting worksheet using a computer spreadsheet program or notebook. Your worksheet will consist of columns for expense headings and rows for inserting cost entries.

List all expenses by type and assign them to a heading on the worksheet. Start with fixed weekly and monthly expenses such as groceries, fuel, rent or mortgage, insurance, dance lessons, etc, and proceed with biannual, annual and occasional expenses. These may include tax preparation fees, auto and real estate taxes, birthday and holiday gifts, vacations, expected car or home repairs and other expenses. Be as detailed as possible, as these expenses can eat up budgeted funds very quickly as they are often overlooked.

Assign an annual cost to each expense type. Of course, you'll need to estimate some of them, but that's okay as long as you have some credible figure in-mind. You'll need to do some simple math calculations to convert weekly, monthly and occasional costs into annual totals.

Add up all expenses to get your total annual expenditures.

Figure your take-home pay to arrive at an annual figure and compare it to your annual expenditures. If expenses are less than your income, you're in pretty decent shape. If expenses outweigh income, you'll need to go back and figure out where you can make cuts in expenses.

Divide your annual expenses by 12 to derive your monthly budget and transfer the information to another spreadsheet. You may also find it helpful to create a weekly budget by dividing annual totals by 52 and transferring the info into a weekly budget sheet.

Create another blank spreadsheet with the same headings and use it to track payments on a regular basis. You'll use this spreadsheet to monitor spending and compare it to what your budget allows.


  • Consider using a computer budget program if you are uncomfortable with spreadsheets. The benefit of doing your own is that you may involve the entire family in the process, making the budget a team effort that everyone is aware of and responsible for.
  • Add payment information daily to save time at the end of the week, month or year. Saving receipts or jotting down expenditures on a small notebook will aid in the process, and it shouldn't take more than five minutes per day for entries.
  • If you create your own spreadsheet, you can add automatic math calculations to certain cells to ease figuring. Go to the "Help" menu in your software for details.


  • Don't forget to add savings, emergency, retirement, college fund and similar entries to your budget headings and assign a dollar amount. You may have head the term "pay yourself first," and this is part of that philosophy. The goal is to tailor your budget to allow you to have extra money, not tailor your income to the budget. Doing so may get you into financial hot water in the future.
  • Don't rely on job bonuses, raises, tax returns or other expected windfalls. Relying on money that isn't guaranteed can spell disaster if if doesn't come through. If you do receive extra money, invest it, save it or pay off debt to put yourself in an even better financial situation.

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About the Author

Matt McKay began his writing career in 1999, writing training programs and articles for a national corporation. His work has appeared in various online publications and materials for private companies. McKay has experience in entrepreneurship, corporate training, human resources, technology and the music business.

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