Budget Basics

This section is devoted to assisting individuals with basic budgeting information. It provides answers to frequently asked questions on budgeting basics.

What is a budget?
A budget is a step-by-step plan that will assist in paying all your bills for any given length of time.

How do you put a budget together?
A budget is made up of a few key items. Those two key items includ income and expenses.
Income: The amount of money that you expect to make/take in, in a given amount of time.
Expenses: The amount of money that you expect to spend in a given amount of time.

The following links assist individuals in putting a budget together:
The Managing Your Money Guide is an easy-to-follow how to guide to developing a budget, spending and savings plan to help families achieve financial goals and manage their financial resources. To purchase this $.75 eight-page guide, please contact the MSU Extension Bulletin office.
The Managing Your Money Worksheet, is a 6-page, free electronic worksheet from the Michigan State University Extension office that helps individuals determine family income, debt, major expenses, and fixed and controllable expenses. Fixed expenses are your expenses that constantly stay the same every month. An example of a fixed expense is housing costs. Controllable expenses are your expenses that are always fluctuating in and out of your budget. An example of a controllable expense is your food bill.

Why should I use a budget?
Budgets assist individuals with obtaining control of their financial future. When individuals put a budget together, they begin to get a clearer picture of their current financial situation as well as preparing for future financial decisions.

Why are clarifying values and setting goals important in defining when I am putting a budget together? Defining Your Financial Directions: Clarifying Values and Setting Goals:
When you are trying to put a budget together, one of the main things that impact budgets is an individual’s needs and wants. A need describes things that you have to have to survive while a want describes items that you don’t have to have, but greatly wish to obtain. Everyone’s needs and wants may be different, but clarifying these can help you to define your financial direction. The Defining Your Financial Directions bulletin assists with these important decisions.

* Worksheet 1a: Money and You... What's Your Style?
* Worksheet 1b: Money and You... Answer Key
* Worksheet 2: Your Financial Dreamsheet
* Worksheet 3a: Net Worth Statement
* Worksheet 3b: Sources of Information to Develop a Net Worth Statement
* Worksheet 4: Smart Goal Worksheet
* Worksheet 5a-b: Setting Financial Goals

How do you track your income and expenses and develop a spending plan?
Tracking Income/Expenses and Developing a Spending Plan:
There are a variety of ways to track your income and expenses and develop a spending plan. This fact sheet will describe those various ways as well as provide you with background information on this process.

* Worksheet 1a: Spending Plan Worksheets... Monthly Income
* Worksheet 1b: Spending Plan Worksheets... Fixed Monthly Expenses
* Worksheet 1c: Spending Plan Worksheets... Controllable Monthly Expenses
* Worksheet 1d: Spending Plan Worksheets... Periodic Expenses for the Year
* Worksheet 1e: Spending Plan Worksheets... Monthly Summary
* Worksheet 2: Spending Plan Adjustments
* Worksheet 3a-b: Tracking Options for Expenses
* Worksheet 4a: Spending Plan Worksheet... Controllable Expense Log
* Worksheet 4b: Spending Plan Worksheet... Controlable Expense Log, pg 2
* Worksheet 5: Monthly Calendar for Making Payments or Tracking Expenses

Additional Budgeting fact sheets from project Furthering Families
Income Loss: How to address the stress and prioritize needs - When income loss occurs in the family, how do you address stress and prioritize needs financially? This fact sheet addresses both the financial and family stress issues associated with income loss. It specifically examines need prioritization as well as techniques to move forward following loss.

How to Change Personal Resources into Income
How to Change Personal Resources into Income provides ideas and guidelines for families to create a larger amount of discretionary income in their life. In addition, it describes how families can utilize their personal assets and resources and adapt those resources into a source of income.

What To Do When Bills Pile Up: Sharpening your Survival Skills
Through sharpening your survival skills, this bulletin provides tips and resources to assist families in making the most with the resources and income that they have. It helps families look at how to efficiently manage situations when the bills pile up and assists in sharpening the survival skills of families.
Frequently asked questions:
Have you ever wondered what the current costs are of raising a child?
Expenditures on Children by Families provides you with current information to assist you with this question.

For information regarding curriculum on budgeting resources, please click on the Curriculum listing at the top of this page.