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How to Create a Budget Template from Scratch

How to Create a Budget Template from Scratch

Just as every person has a unique lifestyle, every budget must be designed to meet that lifestyle.  While many already designed templates can be modified to meet your needs, it is good to know how to quickly and easily build your own budget template using a simple spreadsheet.  Here are the steps you’ll need to complete in order to build your own spreadsheet based budget.  You can read through this article as well as watch our video on how to create a simple template.

Choose Your Spreadsheet Program

It used to be that Excel was the only viable spreadsheet program to use, but that has changed dramatically over the past several years.  Now there are a number of free alternatives to choose from.  For a complete Microsoft Office replica, you can download OpenOffice.org for free and have access to a spreadsheet program that can save its files in Excel format and that Steps to Create a Budget Templatecan also open Excel and other files.  Or, if you don’t mind working online, check out Google Docs, where you can access, save and download spreadsheets in either Excel or OpenOffice format.  At Google Docs you can save the spreadsheet under your username and access it from any computer that has Internet access and a browser.  Once you’ve chosen your spreadsheet program, it’s time to start creating your budget template.

Start by Listing Budget Categories

The easiest way to start your template is to begin by listing top level expense and income categories.  Make sure you know how to add rows to your spreadsheet and reorder it so that you can keep making changes as you think of new categories.  Start by putting your income at the top, followed by expenses.  You should have some type of organizational method in mind when making your list of expenses.  For example, you could list the categories alphabetically if you desire.  In our case, we prefer to list the categories based on the size of the expense.  After a few minutes of thinking about expense categories, here is what our spreadsheet looks like:

Add Detailed Expenses Under Each Category

The next step is to add a row for each expense under each of the categories.  For example, for housing you can add a line item for your monthly rent or mortgage, as well as your homeowners or renters insurance, and any other expenses relating to your housing costs.  Do the same for other categories.  We recommend adding a margin or indenting these detailed expenses to make it easier to read.  We also chose to make the main categories in bold.  The hardest part about this step is trying to remember all of the expenses for each category.  Don’t worry if you forget some of the budget items, as you can always modify and add new expenses as they occur.  Here’s what our budget template looks like now:

Step 2 of Budget Template

Add Columns for Monthly and Annual Expenses and Totals

Now it’s time to get your budget spreadsheet ready to enter your expenses.  At this point, you must determine how you would like to finish your budget.  You could create a budget that tracks your actual expenses each month of the year, or you could create a somewhat averaged budget, that allocates annual expenses into a monthly figure so that you can compute what your average month’s budget looks like.  It really depends on what you are trying to do.  If you’re just trying to get an estimate of how much money you should be saving each month then you could just add two columns.  One for monthly and one for annual expenses.  For annual expenses, you would create a formula for the monthly amount that just divides the annual expense by twelve.  In this case, we’ll make a budget that is meant to be updated each month with actual expenses, so we’ll add a column for each month.  In this step, we’ll also put in totals and borders.  When finished, our budget template will look something like this:

Step 3 of Creating a Budget Template

Note that the “income minus expenses” field is really a calculation of your budget surplus or deficit.  Once you have this step completed, its time to customize your template.

Add in the Final Touches to Your Budget Template

Now that you’ve got most of the template completed you can add in some final touches.  These include adding a title at the top as well as any calculations you want to create.  For example, you could add a percentage calculation for each expense category.  You could calculate it as the percent of total income that you spend on each category, or it could represent the percent of your total expenses.  Determine which figures are most important to you and make some calculations.  Some common budget calculations are as follows:

  • Add up all discretionary expenses and calculate what percent of your total budget they represent.
  • Make a column after each month that shows the percent increase or decrease from the previous month.
  • Add a row at the bottom that shows your budget surplus or deficit as a percent of your total income.  This is equivalent to what percent of your income you should be able to save each month.
  • Create a column at the right of your template that shows an average of each expense.
  • Create a row at the bottom of your spreadsheet that shows how much you’ve improved your budget each month in terms of dollars and percents.
  • Really, the number of calculations you can make here are endless, so focus on what drives your budgeting the most.

Now that you have completed your budget template, it’s time to start tracking your expenses and adding them to your template.  You’ll need to constantly modify it to accomodate one off expenses and to include expenses that you forgot to include in the initial design.  Have fun and save money!

{ 7 comments… add one }
  • Nick April 11, 2012, 8:29 pm

    Thanks for this info. I also like to change the color of the input cells on my budget templates so that they are differentiated from the calculated cells. It makes it easier for me to know which budget items need to be filled in and which are calculated.

  • Lee Hunter April 12, 2012, 10:44 pm

    This is pretty basic stuff but not something that everyone can do themselves. I like how you’ve added the screenshots of the budget template as it’s being created. I am working on my own free budget spreadsheet and will share it here when I complete it.

  • babydollw April 27, 2012, 3:47 pm

    I found this article very helpful but I agree with above that this is all pretty basic for most people. My husband though who is a contractor needed to learn these tools as he grew in business and now he even makes up his bids with a free spread sheet system that came built into our laptop.

    • Chris April 27, 2012, 7:14 pm

      That’s the great thing about spreadsheets. They can be used for almost anything – making bids, making budgets, analyzing financial trends, etc.

      I’d guess that I open a spreadsheet for personal use at least twice a day.

  • Kayde May 9, 2012, 1:13 pm

    I have always found spreadsheets to be a little over whelming. I have never thought about making a template myself. It always seemed too hard, but now I feel a little more comfortable with making one up.

  • sundcarrie May 23, 2012, 10:16 am

    This just gave me a great idea thanks again. I have not been doing the greatest on budgeting lately and I am feeling a little guilty about it. I have always wanted to design my own sheet to fit my lifestyle but I am not a genius with all the formulas or with the ability to get things organized. So I think I will just design a flat expense sheet and start putting all of my expenses in one sheet for the month of June and all of my income on another sheet to see where everything is going. I already know we are not over spending I usually have at least $300 at the end of the months to put in savings but I know I could do better.

  • Tom S August 30, 2012, 11:07 pm

    I appreciate the free budget download and the super simple instructions on how to do it. Most sites are just trying to sell me their products. Seriously, thanks!


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