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Creating a bucket target is one of the easiest ways to start budgeting. I mentioned previously about creating your “Need to Have” bucket and your “Want to Have ” bucket. In each of those buckets are things that naturally fall into the categories. Housing, transportation, groceries, utilities, loan/credit card payments all fall into this category. The amount you allocate into this area depends on what your goals are and what your lifestyle is.

These allocations can change as you move towards reaching your goals. For example, a few years ago, I was in the beginning stages of closing a business, for which I had taken out debt against. I was paying those debts down, along with two children in full-time daycare. Thankfully, I had a husband whose income was supplementing mine as we were both working full-time. We were able to make it work, even though there were times when we thought bankruptcy would be the easier way out. We stuck it through and are at the point now where we can see the light at the end of the tunnel. Of course, the light is simply because of being consistent with spending and an eye to the future. Even when things were tight, we were saving. As our incomes have grown and the bills have gotten smaller, we have tried to stay on the budget we had when things were tight. We’ve shifted the bills we pay to savings and taking care of other debts, like our mortgage. Paying off our mortgage means freedom to us, so for us that is a priority. For others, paying off a mortgage may not make sense or even be reasonable. I get that, which is why I even bring it up. I want to help you on YOUR path. My path is my path, I’m simply here to help you find what makes sense to you. From time to time I will bring up examples and stories of my own journey, but please do not take that as baked-in-stone advice.

So, back to the bucket allocations. Below is a simple tool that can help you get on top of where your money is going. Budgets do not have to be complex, they are simply helping you analyze where you want to spend the money you work so hard for. I’m linking this Excel spreadsheet on my website so you can try it out if you choose. To use the spreadsheet, simply fill in your information, target %, and the items that fall into your buckets. Even if things are tight, always remember to budget something in your “Want to Have” bucket, otherwise you will feel far too restricted. I always recommend targeting the “left over” amounts to push towards savings. This helps when you have expenses that haven’t been budgeted. In the example below, I indicate there is a car/car insurance, however there isn’t a budget for monthly maintenance, that needs to come from somewhere, preferably not a credit card. Using a budget like the one below pays down debt without incurring more, while encouraging savings to help when the unexpected happens.

Good luck. Give it a try, even if this isn’t the right budget format for you, you may find that it puts you in the frame of mind to start taking control of your financial life. If you have any questions, please don’t hesitate to reach out.

Thank you for coming along with me on this journey – <3 bobbi

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