Back to Budget Basics - Our Revised 2018 Monthly Budget

In our last post about our February spending, I mentioned some issues with our budgeting system and suggested I would update the budget to fix them. It was bothering me quite a bit, so I went ahead and tweaked the budget. Read on to see what it looks like.

There was no change to our overall budget for the year. What changed is how the spending was allocated for each month. I previously just divided the annual budget by 12 to get the budget for each month. The problem with that is many expenses aren't perfectly distributed throughout the year, but are lump sums. When those expenses occur, they make it look like we are over budget for the month when we really aren't, which annoyed me.

The solution to the problem was taking a little time to create a budget for each month and adding known large expenses to the appropriate months. I probably should have done this from the beginning, but I was being lazy. It also wasn't an issue before because I wasn't doing monthly budget reports, so I didn't really see the issue. Anyway, our new budget is more accurate and less aggravating to me on a monthly basis. Here's what it looks like:

Item	Jan	Feb	Mar	Apr	May	Jun	Jul	Aug	Sep	Oct	Nov	Dec	Tot.
Groceries	458	458	458	458	458	458	458	458	458	458	460	460	5,500
Property Tax	-	2,700	-	-	-	-	-	-	-	-	2,700	-	5,400
Car	369	569	169	169	555	169	369	569	169	169	555	169	4,000
Travel	290	290	292	292	292	292	292	292	292	292	292	292	3,500
Bills/Utilities	290	290	292	292	292	292	292	292	292	292	292	292	3,500
Household	250	250	250	250	250	250	250	250	250	250	250	250	3,000
Dining Out	183	183	183	183	183	183	183	183	183	183	183	183	2,200
Home Imp.	125	125	125	125	125	125	125	125	125	125	125	125	1,500
Gifts	125	125	125	125	125	125	125	125	125	125	125	125	1,500
Entertain	90	90	90	90	90	90	90	90	90	90	90	310	1,300
Clothing	92	92	92	92	92	92	92	92	92	92	92	92	1,100
Cash	83	83	83	83	83	83	83	83	83	83	83	83	1,000
Home Ins.	700	-	-	-	-	-	-	-	-	-	-	-	700
Personal Care	38	38	38	38	38	38	38	38	38	38	38	38	450
Healthcare	33	33	33	33	33	33	33	33	33	33	33	33	400
Charity	17	17	17	17	17	17	17	17	17	17	17	17	200
Fees	13	13	13	13	13	13	13	13	13	13	13	13	150
Total	3,155	5,355	2,259	2,259	2,645	2,259	2,459	2,659	2,259	2,259	5,347	2,481	35,400
Big Expense	Miata Ins., Home Ins.	Sonata Ins., Prop. Tax			Truck Ins.		Miata Ins.	Sonata Ins.			Truck Ins., Prop. Tax	Water Park

Now that we have a more accurate budget, let's take a moment to see what our January and February expenses look like with this new budget compared to the old one.

Category	Uniform Monthly Budget	January Budget	February Budget	Original Jan-Feb Budget	New Jan-Feb Budget	Jan-Feb Spending
Groceries	$       458	$        458	$       458	$     917	$     916	$     1,257
Property Tax	$       450	$            -	$    2,700	$     900	$  2,700	$     2,896
Car	$       333	$        369	$       569	$     667	$     938	$     1,885
Travel	$       292	$        290	$       290	$     583	$     580	$            -
Bills/Utilities	$       292	$        290	$       290	$     583	$     580	$        881
Household	$       250	$        250	$       250	$     500	$     500	$        226
Dining Out	$       183	$        183	$       183	$     367	$     367	$        529
Home Improvement	$       125	$        125	$       125	$     250	$     250	$        268
Gifts	$       125	$        125	$       125	$     250	$     250	$        137
Entertainment	$       108	$           90	$          90	$     217	$     180	$        320
Clothing	$         92	$           92	$          92	$     183	$     183	$           73
Cash Withdrawals	$         83	$           83	$          83	$     167	$     167	$            -
Home Insurance	$         58	$        700	$           -	$     117	$     700	$        725
Personal Care	$         38	$           38	$          38	$        75	$        75	$        120
Healthcare	$         33	$           33	$          33	$        67	$        67	$     1,040
Charity	$         17	$           17	$          17	$        33	$        33	$            -
Fees	$         13	$           13	$          13	$        25	$        25	$        147
Total	$   2,950	$     3,155	$    5,355	$  5,900	$  8,511	$  10,504

If you took the time to look at all the numbers up there, you can see that instead of being about $4,600 over budget for the first two months of the year using the old budget, we are only about $2,000 over budget. It's still not great, but it's a lot more accurate.

We'll go forward with this new budget for a while and see how it works. Hopefully, no major changes will be necessary.

How do you plan for big expenses in your budget? Let us know in the comments.


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