Consumerist's 9-Step Beginner's Budget

Are you a budget novice? Constantly overdrafting? Never have enough money to buy what you really want? Wish you could get your shit together? We’ve got a sexy free Excel document to share with you.

We used to be like you. By the time we were done bouncing checks we thought we were “keeping track of in our head,” all our credit cards were in collections, we had to do all of our banking in person, and no bank in the state would let us open an account. Eventually we stopped being a crackhead and put together a basic budget based on what we remembered from that accounting class we flunked.

After trial and error, we developed a pretty good Excel system. We never overdraft. We can plan ahead for big-ticket items. Our savings are in the five digits.

Inside, we’re sharing with you what we learned the hard way. And in 9 easy steps, you’ll be managing your money instead of your money managing you—without spending a dime on a fancy-pants accounting program…


• A strong desire to take control of your personal finance destiny

• Excel

Step 1: Do you have a checking and savings account? If you don’t, get one from your local bank. Or apply for one online through HSBC Direct, or INGDirect.

Step 2: Download and open this

Date: The transaction date.

Check No: The check number, if applicable.

Description: What the money was for, i.e. “milk,” “movie tickets,” or “congressional bribes.”

Debits: How much money is going out

Credits: How much money is coming in

Total: How much money is in the account, in total, for that time period.

The TOTAL field is a simple formula: =SUM(X:Y)+Z

This sums a range of transactions together (from x to y), then adds the Z value, which in this case is the previous month’s total.

This TOTAL is real time. When you make or plan a credit or deduction, you’ll automatically know how much money is left in the account, and how it will affect future balances. This is one of the system’s most powerful features.

Note: Transactions are either debits or credits, never both at the same time.

Step 4: Enter totals. If you already have a checking and/or savings account, put the current available balance for each in ROW 3, under TOTAL. Find this out by checking your account online or calling your bank. If you don’t have online banking set up yet, now is an excellent time. Contact your bank for details.

Step 5: Enter your monthly paycheck in place of the number next to Payday, under the CREDITS column. Copy and paste this number throughout all the months. Do the same if you have any other regular sources of income, like a stipend, dividends, or that pot of gold you’re always finding under the full moon.

Step 6: Enter your monthly debits. We set up a few examples, like electricity, heat, food, Netflix, and cable. We use the yellow paint bucket to show payments that we expect to make. Ones that don’t have a specific date they’ll be processed on, we place at the end of the month until they get processed.

Note: We recommend setting aside at least 10% of what you earn towards savings. Change the “Nest Egg” number to reflect your income or delete, as appropriate.

Step 7: Enter any expected future one-time credits and debits, such as pending checks, gifts, trips, DVDs you plan on getting, whatnot.

We highlight checks we’ve written but haven’t been cashed yet in purple. When the check actually processes, we change the date to the processed date and remove the highlight.

Click to enlarge.

Note: You may probably have more credits and debits to keep track of. If you need more rows, just highlight the amount of rows you want to insert, right click, select insert, radio button “entire row,” hit enter.

Step 8: Review. First thing to do is make sure all your TOTALs are correct. Right click on each one and make sure the blue highlight box is for the dates it’s supposed to be. Make sure the green box is on the previous month’s total.

Are there any negatives in future checking dates? This means you’re going into the red, bucko. Limit your spending to compensate. See if certain expenditures can be moved around. Deposit money in from savings.

Step 9: Update your budget at least once a week. What did you buy this week? What money came in this week? Put it in the system. Again, eyeball future dates and make sure nothing is going into the negative. Adjust spending as necessary.

If your bank offers online banking, you can reduce errors by copying your transactions directly from their interface.

a) Go to your account.

b) Download transaction history.

c) Specify the date range.

d) From the download software selector, choose “.CSV” which stands for “comma separated value.”

e) Open with excel

f) Highlight the transaction history

g) Data -> Sort -> Date column ascending

h) Cut and paste the result into your budget

Tip: Cutting and pasting, and even day to day use can get the number formats changed around. To keep everything the same, you may need to periodically highlight the debits and credits columns, right click, hit format cells, and select accounting. This puts nice parentheses around all your debits.

If you don’t do online banking, keep all your receipts and put them in a box. Empty the info from the box into your system once a week. Throw the receipts away (unless you’re saving some for taxes).

! Warning ! Make sure you’re either entering info based all on receipts, or all from your online banking. If you mix and match and try to play catch up later, you’re likely to miss something and get off between your system and what the bank says.


Should I keep track of cash expenses? It’s up to you. We find it easier just to keep track of ATM withdrawals but you may find it helpful, especially if you’re really trying to monitor ALL your transactions, to create a third set column for “petty cash.” Treat it just like the other accounts. Just make sure that you aren’t tabulating your petty cash spending against your checking or savings account.

What if my TOTALS get off from what the bank says? First, check to make sure your SUM equations aren’t selecting the wrong dates. 9 times out of 10, that’s the culprit. Secondly, go over your transactions between your system and the online itinerary (or by phone) to make sure you’re not missing anything. Third, check to make sure you entered the proper account TOTALS in step 4. As a last resort, you can enter a credit or debit as necessary to get your number to match the bank number. Call it something like “oops” or “magic money.”

FINAL WORDS: If you’re already using Qucken and are amortizing you 401k or whatever gives you a boner, this setup is not for you. It’s for rank noobs, novices, people who have never put together a budgeting system before. We could tell them to go buy Microsoft Money, but if you’re having trouble managing your money, you probably can’t afford that, eh?

For the rest of you, use this system properly, and you will never have another overdraft. You’ll know how much and when money is coming in and going out. All your financial details will be arranged in an understandable system. You’ll find yourself with greater control over your life, less frustrated, and happier, clearing space in your brain for the important things in life, like figuring out how to make more money. — BEN POPKEN


Edit Your Comment

  1. dohtem says:

    Heads up, the link to the excel is broken.

    Funny enough, I was just looking at a free app last nite that might do what I need. It’s called Money Manager Ex. I’ll try your method and see how it goes.

  2. mike1731 says:

    Another option would be to utilize a PC program like Quicken or Microsoft Money to track things. Quicken has a budget program that will automatically build you a budget based on past spend, or you can manually enter your balances. The key to success with quicken is to not go crazy with accounts — don’t set up everything as a expense category, at not least at first. Keep it basic, maybe 10 or 15 categories, and set time aside to play with the reports.

    As a household of two accountants, it’s taken us a while to get the hang of the reports, in large part because we were too clever by half setting things up. But with a smaller scope and less detail, the automated banking links work wonderfully and you can manage your daily spend in 5 – 15 minutes / day entering all bills, payments, making payments to creditors via the bank, etc. Pretty slick. Only downside, I don’t remember how to write checks now days without thinking about it.

  3. Ben Popken says:

    @dohtem: Fixed.

  4. Shutterman says:

    Those Masonic Lodge fees are always important.

  5. I use Yodlee to manage my finances. Its online (I can access it from anywhere), and automatically updates all of my accounts for me (and sorts/graphs my expenses)…

    Its a great program…

  6. Craig says:

    You might also want to look at the free Pear Budget, which is the same idea but with four years of refinement.

  7. LatherRinseRepeat says:

    The Microsoft Office site has a lot of free templates also. They have quite a few personal finance templates, for different versions of Office. I found a handy load ammortization template that is useful for playing with numbers and trying different what-if scenerios.

  8. Johnie says:

    Seriously… why not spend a couple bucks on Quicken or MS Money? Once you go Quicken, you never go back.

    It downloads all the information from my banks and creates a budget for me. You can create all types of reports too.

    • Adisharr says:


      I second MS Money or Quicken. These Excels sheets are nowhere near as complete and usable unless you have very simple requirements.

  9. Or apply for one online through HSBC, or INGDirect.

    HSBC=BAD Stay far, far away.

  10. skittlbrau says:

    @Rectilinear Propagation:

    I’m curious, as I’ve been a happy HSBC Direct customer for over a year… Why HSBC = BAD? (Beyond the fact that all banks have some pretty poor service)

  11. The_Truth says:

    I think the argument of not using quicken is that if you are in need of serious money managment then you probably cant afford it.

    For me I use an excel spreadsheet, much the same as this one, although even more simple layout, but a few more advanced formulas.

    Everyday I check my BofA account and update onto my spreadsheet any transactions. At the end of the month I move all of my keep the change that was taken from my main checking into an ING account.(5% match plus 5%(ish) interest equals about $60 free moneys a year!)

    My ING account recieves two deposits monthly as well as the savings cash, this is done automatically by ING.

    My spreadsheet shows me, my costs for the month and my predicted end cashflow at the end of the month. I transfer what evers left over into ING as well.

    Stopping overdrafts is easy, give yourself a $1000-$2000 buffer in your main checking account. This can be your base point to withdraw all that spare cash to at the end of the month.
    As an added layer of protection, chuck an additional 1000 into a regular savings account (preferably with the same bank), so as to cover any serious screw ups.

    Having said all that, I honestly believe unless you are actually willing to step up and take control all of the above is pretty useless :-)

  12. dohtem says:

    @Rectilinear Propagation: How do you make a comment like that and not give a single reason why?

  13. capitalass says:

    Are those numbers real? Who can eat on $50 a month? That’s like $12 in groceries a week (assuming you are just referring to groceries–otherwise it’s like 10 meals at consumerist’s favorite fast food joint–still, that could be about 8 or 9 thousand calories a month).

  14. Ben Popken says:

    @capitalass: The numbers are for demonstration purposes only.

  15. eatsshootsleaves says:

    I’d say about ten percent of your money should go into a 401k as well. I know you said that this only really applies to people who have no idea how to make a budget, but investing in a 401k is really, really easy and if you start young you can be practically swimming in money by retirement.

  16. kenposan says:

    I used an excel spreadsheet years ago to set up a budget. Wasn’t as fancy as Ben’s. But then I got MS Money really cheap when the local KMart closed. :-)

  17. I love ING. I’ve had their Orange Savings Account for a year and a half now and couldn’t be happier. And my rate keeps going up! Imagine that!

    I actually had a very pleasant conversation with a guy at their customer service centre in Minnesota when I set the account up. I kept asking, “Are you sure there’s no minimum? And no fee? Are you totally sure?!” Yes, he was.

  18. boston515 says:

    The_Truth said, “Stopping overdrafts is easy, give yourself a $1000-$2000 buffer in your main checking account.”

    Most people who are starting to budget don’t have that much money available. I, personally, don’t keep more than $500 in my accounts in the event that I might be robbed. (I’d be dead anyways since I don’t even know the pin to one of my debit cards!)

    I HIGHLY recommend the habit of automatically putting away 10% of one’s income. 10% might seem like a lot a first but it’s easy to adapt. If 10% is too tough, try 5% and work your way up 10% percent as finances get in order. I try to put away 20% into my ING savings account each paycheck, when I can afford it.

    I’m really excited about finally finding an FDIC-insured Roth IRA at Wells Fargo, as they are fairly difficult to locate. Anyone know if Wells Fargo is reliable for investments?

    HEY The_Truth, would you be up for sending a blank of your Excel my way {scadian_d204[at]yahoo[dot]com}? My boyfriend uses BoA and wants to use the same plan that you’ve described for saving.

  19. FLConsumer says:

    Quicken’s probably a good start for most people. If you “can’t afford” the $30 for the most basic version of Quicken — you absolutely need to buy it, even if you’re charging it onto your already Mt. Everest-size pile of credit card debt, YOU need a budget!

    Having everything categorized (Dining/Entertainment/Groceries/Utilities) and being able to see where your money’s going is essential to starting a budget. Without knowing what you’re currently spending, coming up with realistic budgets (and keeping track of your progress) is more like shooting in the dark.

    If you’re uber-lazy, sync it up with your bank’s/credit card’s online banking service so you don’t even have to enter the transactions (‘though I’d highly recommend manually inputting everything each night or every couple of nights and using the downloads as your way of reconciling your checkbook). Manually entering data also ensures that your credit card charges are valid.

    @boston515: If someone doesn’t have at least $2k spare in the bank, then there’s their first financial goal — a rainy day fund. Even more reason why they need to develop a budget and stick to it. The 10% idea is an excellent one. Millions of people do 10% for their churches and don’t miss it. I believe people should be saving 15-30% of what they earn, not only for retirement purposes, but also in case something bad (hurricane, long-term medical problems,etc) creep up.

    As a side note, for everyone with money in non-local banks consider scheduling in advance a transfer to an account at a local bank/ATM-accessible account to happen about 3-5 days after a natural disaster is supposed to hit (I’m thinking hurricanes, from past experience.) That way if you lose phone/internet, you’ll still have access to emergency cash. Most of the larger banks had either mobile ATMs sitting outside of what was left of their buildings or had their entire building running off generator & satellite links. Forget using CC’s/check/debt cards after a hurricane, phone lines will invariably be down/busy. Cash rules in/after a disaster.

  20. fugly says:

    if you can’t afford MS money or quicken, and are using Linux or MAC OSX, then Gnu Cash is a free alternative

  21. @baa: Their customer service has been really bad. Wachovia may not be stellar but they’ve never kept me from my money for weeks at a time.

    I believe you when you say that you haven’t had trouble with them and I’m glad you didn’t but I’ve only had this much trouble with insurance companies up until now.

  22. Morton Fox says:

    Quicken Basic is $30 and you only have to upgrade once every 3 years to maintain online services.

  23. brilliantmistake says:

    I’ve used an excel system very similar to Ben’s, and it’s been really useful. I have some other suggestions that helped me
    1) Use an online bill pay system. This really saved my wildy disorganized bacon. Everything in one place, online, you can use it when you travel, and they keep records. I use, but there are others.
    2) In addition to a worksheet like the one Ben shows, I have one that I use every so often to track all my monthly expenses in a very itemized way. Especially in my early reorganizing days, it let me see where the money was going. Who knew that 30% of my food budget was evenly divided between coffee, sushi, and beer? Not me, until I started logging it. I don’t do it every month anymore, but use it every once in a while.
    3) I have a third sheet with all my credit cards, the balances, limits, interest, % of payment that goes to interest vs. principle. My balances are up from high vet bills coinciding with an income decline, so I’m in the middle of paying them off. This helps me target the payments.
    As Ben said, this a basic, first step. I like the simplicity of an excel sheet, and I can set it up in a way that makes sense to me.

  24. karmaghost says:

    Gah! Use cleartype in those screens!

    I’m using Pear Budget, too. Well, “using” as in “it’s on my hard drive… somewhere…”

  25. boston515 says:

    To quote myself, “I, personally, don’t keep more than $500 in my accounts in the event that I might be robbed.” I actually don’t keep more than $500 in my checking accounts, as they are set up so that ATM access to the savings account is restricted. A lot of people can’t afford 30% put way each month. Seeing as I make $300 a month, that would mean I’m putting away $90. That’s a lot when I have bills to pay. It’s easy not to leave off of much, but $210 would be too difficult.

  26. infinitemonkey says:

    I can’t recommend Buddi enough:

  27. videocrime says:

    buddi has worked like a charm for me. kudos on this article, though.

  28. SuperTodd says:

    Excellent spreadsheet for what it is, I have a similar one I use, since my bank does not link up to Quicken.

    Don’t forget that if you’re too cheap to buy Quicken, you’re probably too cheap to buy M$ Office. OpenOffice is an excellent open source alternative to Office. I was able to download this file and open it no problems

  29. falcon241073 says:

    I use Money ’07 and love it. I have used Money since 1998 and will keep on. (kind of locked into it now, LOL).

    Thinking of trying this online bank out for a checking and savings account:

    I will still keep my local bank too, for emergencies.

    I also recommend Dave Ramsey. He is a financial GURU!!! here is his site:

    He has a Talk show on radio too, you can download a 1 hour podcast on his site. He is awsome and speaks the truth. As he likes to say “Giving the same money advice as your grandmother, only keeping his teeth in while he does it.”

  30. smastous says:

    You don’t need to swear to get your point across! For instance I am a market that is religious. I don’t relate to swear words or innuendo. Seriously, please consider cleaning the language because it is like a hurdle to the coolness of your site.

    Thank you for the tools.

  31. YadonWaffles says:

    gnucash is now available for windows: And it is still free.

  32. Hemlock26 says:

    I’d like to submit my non-techie tip. Although I also use an excel spreadsheet (Girlfriend helped me set it up, she’s a wiz!), I don’t always have my computer on. I know, I know, that’s blasphemy!

    I do keep a wall calendar by my desk, though. As I get email updates or bills in the mail, I mark which bill on what date down on the calendar. That way I will always see when something is due. And the visual that my insurance, student loan, and cell phone are all due on the same day helps me refrain from going on that shopping spree.

  33. dee1313 says:

    I just made my own Excel spread sheet, and it works wonderfully, and is pretty.

    I’d attach it if I knew how.

  34. digisplicer says:

    Really? No mention of It’s an amazing and FREE budgeting tool. Yeah, you have to give some personal info to them but I also have credit monitoring so I like to think I’d have a heads up if I became a victim of identity theft. I highly suggest checking it out.