One of the most common misconceptions about budgeting is that is takes a l-o-n-g time. Most people who do not learn how to make a budget do so because they believe they don’t have the time to budget. But, if your budget is doing its job you should be able to budget without a major disruption to your schedule.
While some people work for different reasons, most people work to pay the bills. Some even hate or begrudge their jobs. Yet they continue to put in 40 plus hours a week to earn money to pay the bills. However, for most people, taking 20 minutes a week to budget could dramatically reduce their expenses which would also decrease the need to earn so much money. Remember, a penny saved is more than a penny earned.
Photo by Aaron Geller via Flickr
Time commitment every 2-3 years: 1-3 hours.
Collect receipts every time you spend money. If you don’t get a receipt, just take a receipt you already have and make a note on the back of the receipt. Include the item purchased and total cost.
Time commitment per transaction: 0 seconds if they give you a receipt and 20 seconds if they don’t.
If the average person makes 10 purchases a week where they don’t get a receipt, it will cost them 2 minutes of their week.
Yes, call it a date. When you’re on the same page with your finances, your marriage will be better.
Have one person enter the information and the other read the information from the receipts you’ve been collecting. In our case, we budget on the computer using Moneydance. You Need A Budget is also a good computer budgeting program. My wife reads the charges and I enter them.
Time commitment per week: When the computer is on, you can enter all our receipts in about 15 minutes.
At the end of the month, you’ll need to review your budget and make changes if necessary (i.e., you overspent on a category). When you start to get a handle on budgeting, you’ll need to decide how you want to use unspent money.
There is no point in keeping a budget unless you plan to change spending habits based on your monthly spending totals. Review the budget and make the necessary alterations.
Time commitment per month: 10 minutes.
Each month use the same amounts in each budget category. For simplicity just take the same budget and use month to month. There is no reason to reinvent the wheel. On occasion, however, changes must be made. They might be significant changes like the loss of income or minor changes like family visiting for a week. Reallocate some dollars to cover the new charges.
Time commitment 1 hour per year.
If your budget is taking more than 30 minutes per week, it is way too complicated so it will be hard to stick to your budget. Setting an alarm for 25 minutes and complete all of your budgeting in that amount of time. When the clock is ticking, we always seem to work more efficiently. After you master 25 minutes, try doing it in 20 minutes. Once again, when put to the text you’ll find a more efficient way to budget.
What tips do you have for budgeting efficiently? Do you think it is possible to budget in less than 20 minutes per week?