Great work estimating your income yesterday! Today, we’ll move on to the next step in creating a sound budgeting foundation: estimating our expenses.
Estimating our expenses is an important step — we all need to know how much we actually spend so we can start planning what we want to spend. But we also need to make sure that what we’re budgeting for is less than the income we’re bringing in. (We’ll worry about that later, though.) For now, let’s focus on estimating. And remember, this is a guilt-free zone — you’re just collecting info right now. The point is to just notice your spending trends and say, “Oh, I see.”
Today’s Assignment
- Estimate your expenses. You’ll need to take a look at past spending in order to estimate successfully. Head to your online bank account and take a look at what you spent last month. If you have multiple bank accounts, be sure to check those too so you can get the fullest picture of your spending. (If you’re already using the Goodbudget app, check out your Spending by Envelope report.)
- Without categorizing individual transactions, how much did you spend in total last month? How much did you give last month? How much did you save? Note: Some of your spending might not be “typical.” Be sure to still include those expenses in the totals above. Transactions that are unusual will always happen, and we want to work towards making space for them in our budgets. The goal here is to just accept the numbers we see in front of us.
- When you looked at what you spent, what struck you? What are your initial thoughts as you look at the numbers? Did you spend more or less than you thought? Did anything surprise you? Share your reflections with us in the comments below!
Note for couples: You can look up your past spending separately or together; just make sure you both take a look at what you find. By the way, if you have kids spending family money, remember to pull that up too.
Happy budgeting,
-The Goodbudget Team
223 thoughts on “Take a Look Back”
I wish I could honestly say that half the stuff I bought wasn’t really needed, but it seemed important at the time. Yes, I can do without many things but I’m not sure I want to. By the end of the year my average monthly spending has risen to $150 more than I take in. Obviously this is the time to get serious about living by a budget instead of by general awareness. I feel lucky to be in this class at this time.
We are completely overspending!
I am only spending on the absolute essentials. I have made a Travel envelope as I would like to take a holiday when I can afford it.
We are overspending on things that we could really live without.
I knew it was going to be closed, but I thought I would at least break even. I was shocked that I spend almost $400 more than I made.
Spending to live is expensive
We are both making bad mistakes in how we spend our money, being able to distinguish between wants and needs. We waste money on things we don’t need and over spend without noticing the outcomes.
My credit card debt is ridiculous. I need to build my credit rating back up in order to get a credit card consolidation loan. What I previously viewed as necessary, isn’t really. There are definitely some that need to be cut out. Some of those I have to check on how to unsubscribe when paid up for a year.
I acknowledged my credit card debt. There are things that I could cut out. I need to check my 4 in 1 plan to see if I can get a better rate. Knowing that once my mother’s & my cell phones are paid off that bill will go down plus as of the first paycheck of April 1 will no longer have a deduction taken out that I ended up not using. I see some hope where I felt hopeless. That feeling may go back and forth but I know that there is light even if it’s dim.
Well, lots of expenses are practical and had to be done. Doctor visits, insurance, manicure, food, petrol, house rent. I don’t want to say no to some expenses, like eatinf out. But they could add more to the budget.
I was shocked. I spent more than double what I made, at first I was like, how is this possible?!?! I am glad I am taking this course!