Rule #1 when creating a budget - MAKE IT SIMPLE. There’s a term accountants use, “substance over form.” Simply put, make sure what you’re doing is meaningful and not just pretty or impressive looking. If you are spending hours on the form of your budget, it’s time wasted. When you complete it, the thought in the back of your mind will be, “Wow! It looks great! But there’s no way I have this much time to maintain such a monstrosity every month.”

It doesn’t matter if you’re a lifelong budget keeper or you’re starting new, you can fall into this trap of over complicating your budget. Here’s my story. Like you, I read the financial advice from the pros and try to apply it. The other month, I spent 2 hours trying to get my financial software to work the way I wanted it to work. It didn’t help that my software was 3 years old. I have friends who love financial software and they do their budgets within minutes. I should be able to this, right? Ah... nope. I spent an hour just fixing or reclassifying the categories. Once I ran the budget, I determined it was showing items I had already accounted for. I couldn’t even remember what payees were in some of the categories. There was no way I could maintain that budget. Don’t get me wrong, I love financial software when it comes to analyzing my debt and balancing my accounts. I love the way it pulls from all of my accounts, but my budget was a disaster.  

Last year was an awesome year. I had the opportunity to teach budgeting and estate planning at my local church. I didn’t tweet, Facebook, or Instagram about it. I just let the minister announce it and let God do the rest. I actually had over 50 people sign up. I’m truly grateful for the opportunity. I pray the students got what they needed, but I also came away with a few questions.

A few people in my class had previous budget knowledge, but from the questions I received, I got the impression they were not working their budget. So I did as I tell everyone to do. I went back into prayer and discovered that the mechanics of doing a budget were missing. I covered it during the class, but for the folks who missed the class, I wanted to do a quick review.