Ramsey Solutions has all the tools you need to get a great budget! You can make it as easy as you want and as complicated as you prefer. (every dollar)
Monarch Money, Simplifi and EveryDollar are financial apps with varying levels of complexity. I personally use Quicken for Desktop because I can have a snapshot for my personal and business as well as a variety of reports for past performance.
FREE: Download the app from your current bank or move your accounts to a bank that offers budgeting or financial management software. Many now allow you to connect outside banks and brokerage accounts to reflect your total net worth snapshot.
Basics:
Decide what you want your life to look like.
Then with everything you spend your money on, ask yourself if this gets your closer to or further away from what you really want. A budget will feel like a prison if you use it to tell you what you have to GIVE UP. If you see it as a tool for building your financial freedom, you see how it will help you GET what you want.
Write it down
Information floating around your head isn’t helpful. Grab it and trap it on paper. Your budget is your cashflow statement: write down all your current income (from all sources) and all your current expenses/obligations. Per Dave Ramsey, give every dollar a name.
Track everything
When you write down everything you spend and everything you earn, you start to pay attention to your cashflow. You can more easily identify where you are leaking money and what activities are earning you money and which are costing you. After a week, you will have heightened awareness. After a month, you will understand your financial picture and be more in control. After a year, you will know exactly what gets you closer to your goal and what keeps you from it.
Revise regularly to fit your life and your goals.
Review how the plan is going, make adjustments, leave room for life. Making your money work for you instead of you for your money is the key to financial independence.
Budget Bucket Breakdown
10% Giving
Detachment = Good Stewardship. Money flows to the person who takes care of it and manages it well. By committing a percentage to serving others, you are releasing your jealous grip on money and allowing it to begin the flow of money back to you. Money can’t stand still. It needs to always be growing and building. Giving a tithe develops confidence and trust in a good God who doesn’t need your money, but desires your trust. Giving deepens your heart and your ability to grow. It develops the ‘Enough’ muscle.
20% at least for Financial Freedom Fund
Commit to setting aside a minimum of 20% of your income to buy assets (like stocks, real estate and businesses) to build your net worth and achieve early financial independence.
Needs
Budget the non-negotiables first–and question even those to see how to spend smarter. Needs would include: housing, food, transportation for example.
Wants
Wants would be the non-necessary line items that you want to have/do but you could live without while you are building your wealth. Wants are good! You just have to manage them and ensure that they are not getting in the way of your freedom.
When you have filled your buckets and there is still money, throw it back into the financial freedom fund or paying off debts. If you don’t put your money to a task, it will leave and you won’t know where it went!