Gathering all the figures relating to a household budget is the first step in creating a workable snapshot of your income and expenses. Once you have rounded up your list of typical household budget items, you can enter it into budgeting software to help determine where your hard-earned money goes each month. Household budget items include every penny you spend and every penny you earn in a given time frame. Most budgets are set up on a month-to-month basis, and encompass everything from expenses for the family pet to end-of-year bonuses.
Start with your income. Even though it looks good on paper, you cannot live on your gross income, so jot down your net, or take-home, pay. When considering income sources, do not forget year-end bonuses or goal-oriented monetary rewards. While the latter two may be unknowns, you can use a ballpark figure gleaned from previous experience.
Pencil in your car payment in the finance payments section along with any other financed obligations. Your dreaded student loan belongs in the fixed-payments category, as does the mortgage on your house, credit card payments and any personal loans.
Entering monthly fixed expenses is a large portion of the budgeting equation. You should record your car insurance; homeowners insurance and property taxes; gas and electric bills; cable or satellite television bills; landline telephone payment; ISP bill; cell phone bill; life and medical insurance premiums; and monthly savings commitment in the column designated for fixed expenses.
Record cash outgo for family vacations in the planned expenses category. You should also list monies set aside for holiday gift giving and birthday presents in this category. List these costs in the month you will expend the funds. For instance, if you plan to journey "over the river and through the woods to grandmother's house" for Thanksgiving, jot down the cost of the home-for-the-holidays trip in November’s budget.
Register just about everything else you spend money on under variable expenses. Just a few of the most common variable expense budget items are gasoline, clothing, entertainment, memberships, continuing education, prescriptions, dining out, groceries and yes, this is where you slip in those pet care expenses. Another typical household budget item that is often overlooked is daily cash outlay. Keep a small notebook handy to record such incidentals as parking fees, tips, soda machine purchases and that occasional candy bar indulgence. After all, these purchases do eventually affect your bottom line, which is what creating a budget is all about.
Cheryl Withrow is a writer in Michigan’s untamed Upper Peninsula. Following a teaching career she served alternately as editor of the "Washington County News" and the "Geneva County Reaper," and as associate editor of "Bay Life" magazine. Withrow holds a Bachelor of Science in business with a major in accountancy from Wright State University and a Bachelor of Arts in English from Ohio University.