Budgeting Old School: How to Set Up a Budget Without Using an App

Do One Thing:  In this world of busy schedules, very little happens when it isn’t on your calendar.  Set aside a two-hour window to get a jump start on your budgeting process…whichever method you decide is right for you.

When it comes to creating a personal budget these days, you may not need all of the bells and whistles an app or web-based program can offer. Sometimes, all you need is the right frame of mind, plus a pencil and paper—and maybe a spreadsheet—to take care of business.

But make no mistake, you need a budget. Why? Because creating a spending plan helps you take—or regain—control of exactly where your hard-earned money goes. And it can go a long way in creating the kind of peace of mind we could all use more of in our hectic lives.

“We do a lot of work with our clients around budgeting, and ’old school’ is the way to go,” says Pam Horack, a certified financial planner at Pathfinder Planning LLC in Lake Wylie, S.C. “We help them define their income, savings for non-monthly expenses, regular fixed expenses, and their other spending.”

After that, Horack assists clients with balancing their income and outflow. And once that’s done, they are directed to set up at least two checking accounts. One is to manage their income, savings, and fixed expenses (all of which can be automated) and then a separate account for day-to-day spending.

“With this process, clients don’t need to use apps or trackers,” she says. “They just need to set a low balance alert on their spending account so they don’t go below zero.”

You can follow these steps to build a better old-school budget for yourself:

Set Aside Some Quiet Time

To get started, you need to know where your income is going every month. Set aside about an hour in a quiet spot for this next part. Gather the last few months of financial statements, including credit card bills and checking account info. Now dive in, going line by line on every single purchase or expenditure. Often, you may find there are obvious places to cut your spending, such as streaming services you barely use or even forget about.

Spreadsheets For The Win

If you aren’t interested in using an app, you can easily create a budget in a spreadsheet, notes Sara Zuckerman, a certified financial planner and founder of Reset Financial Planning LLC. “There are many templates available online, or you can start by just listing all the major categories of your spending and then add to it as you remember other expenses over time.”

Pro-tip: Don’t forget to add things like car insurance and property taxes, which you may only pay a couple of times each year, says Zuckerman. “I recommend tracking both the monthly and annual numbers so that you can compare categories that have different billing periods.”

The Basics of Your Budget 

On paper or in a computer spreadsheet, create a line for every monthly expense, including housing, utilities, transportation costs, food, streaming services, insurance, etc. If these items add up to more than your take-home pay, it’s time to adjust. As in, you need to find places to trim your spending. Need help? Consumer.gov offers a free budget worksheet to help you get started.

• Create Financial Goals. When you have a better grasp on where your money is going, consider what you want your income to help you accomplish shortly and even in the next five or 10 years. Do you want to buy a home or help pay for a child’s college education? This is where you can embark on a path to make those goals happen.
• Build Up an Emergency Fund. A simple way to save some of the money you make is to open a separate high-interest savings account and have a portion deducted (through an electronic funds transfer) from your account every time you are paid. This works because if you don’t see it you likely won’t spend it. If you are worried you don’t make enough to save then start with a small amount, such as $20 every pay period. Your savings will add up faster than you think!
• Set Monthly Check-Ins. Much like exercise or eating healthy, Zuckerman says, keeping a budget can be challenging to do over time. To keep the momentum going, she recommends setting aside one evening a month to update your budget. To make sure this happens, put it on your calendar to help ensure you commit to some focused time with your finances. You won’t regret it.