Create a Simple Budget with a Piece of Paper and a Smartphone

While I am a huge fan of budgeting apps like the EveryDollar budget, I’m also a person who comprehends things so much better when I write them down. In fact, my first simple budget was nothing more than a piece of paper and a smartphone. Often times I still need to use this message just to help my brain really pay attention to where my money is going every month. It’s why I created an easy to use Budget Bundle. I needed something that was specific to my budgeting needs that was easy to follow and I knew others probably felt the same. Check out the budget bundle. So, if you don’t like worksheets, how do you start a budget with a piece of paper and a smartphone? I promise it’s a lot easier than you think.

*This post contains affiliate links. I may make a commission on my recommendations at no cost to you.

Make a goal

Before you get started dissecting your budget, it’s important that you make a goal for what you want to accomplish through your new simple budget.

Do you want to pay off debt?

Have more fun spending money?

Build a savings?

All three?

Whatever it is, whatever your goal, it’s important that you state that goal right off the bat and be as specific as possible.

For example, if you are wanting to put $200 toward debt, have $100 of spending money and you want to put $100 into savings, write those numbers down! This way, when you start your budget you have a goal to work toward.

Join my FREE Facebook Budgeting Group.

Log on to online banking or app

The first thing you are going to want to do when you are starting your simple budget is to log on to your bank’s website or app. Doing this should allow you to access all of your current and past bank statements so that you can do a full analysis of your budget.

Find your average income

Once you have located your bank statements, use your smartphone’s calculator to find your average income over the last 3 months.

For example, if you got paid 2 times each month, in the last 3 months you will have received 6 paychecks. Right?

So what you are going to do to find your average income is add up those 6 paycheck totals. Once you have added them all up, divide your total by 3. This will give you an average amount of how much money you are making each month. Here is a visual .

Once you have done this, you are going to use the same method to determine how much you have been spending on average for gas, groceries, and entertainment.

Gas, grocery and entertainment averages

Go through your bank statements for the last 3 months and use the same method to calculate your gas, grocery and entertainment averages.

Entertainment can fall under anything that isn’t a necessity. Things like going out to eat, alcohol, date nights or even things like cable TV. You get to choose what fits in this category but it’s also important to be honest with yourself about it.

Calculate your average percentages

Once you have an idea of how much money you are spending each month, take a look at Dave Ramsey’s recommended budget percentages. They look a little something like this:

  • 10% Giving
  • 15% Savings
  • 15% Food
  • 25% Housing
  • 10% Transportation
  • 10% Spending money

Now it’s important to find out if you are fitting within these budget recommended percentages.

Let’s say you are making an average of $3,500 per month and your house payment is $1,450. You should be putting 25% or less toward your house payment each month.

To find this number you will take your average monthly income (3,500) and multiply it by (.25) to get the answer of ($875)

Based on this budget calculation alone you can see that you are spending $575 above the recommended budget percentage! That’s a lot of dough! Don’t worry, you’re not alone. The average American is putting 37% of their take-home pay toward their mortgage. However, just because it’s normal to be house poor does not mean it’s the right way to live.

A few years ago, our family found ourselves house poor and we decided to do something about it. We downsized our house by 2,000 square feet, reduced our mortgage by $600 per month and are now paying around 22% of our take home pay towrad our mortgage.

Find where you can/should scale back your budget

Now, I understand that paying too much for a mortgage is not a quick cost that you can fix. What you need to do is take a look at the other areas where you might be overspending and put your focus toward them. One great way to do this is by using the Trim app. Trim will review your monthly spending and find areas where you could be saving money! They will even make the call to your service provider for you!

Other great ways to scale back your budget:

  • Ting – Ting is a great way to reduce your mobile expenses each month. You could easily reduce your phone bill by OVER half. Try Ting now.
  • Mohu – Getting a digital antenna through Mohu can save you thousands of dollars, plus they make it easy to connect through your entire house.
  • OhmConnect – OhmConnect is a company that gives you rewards for saving energy! They offer energy saving events to help you save on the cost of your energy bills and in some states will actually pay you for participating! See if you qualify!
  • Aaptiv – You can get total fitness, meditation, yoga and other workouts connected right to your phone for only $15 per month! Get your first month free! 
  • Chewy – Save a ton of money on products and food for your pets and set up automated shipments so you don’t have to pick up anything from the store! Sign up for Chewy!

How to scale back on groceries

If you struggle like I did when it comes to keeping a spending cap on groceries, I have a few tips that can help you create a solid grocery budget that doesn’t leave you broke or without food at the end of the month.

  • Figure out your budget percentage and then divide it by the number of weeks in the month. This is your weekly spending limit.
  • Shop your pantry first. Get ideas on what to buy based off what you already have.
  • Keep tally of your spending in your head or on a calculator. Do not spend more than your budgeted amount.
  • If you go over, find where you can reduce your spending. Return items, exchange your name brand goods for generic, etc.
  • Work with cash! I always take our grocery budget out of the bank as soon as we get paid. This way, I have it on hand and it’s a lot harder for me to just put it on a card.

Not a natural when it comes to planning healthy meals, especially on a budget? Take advantage of the $5 Meal Plan! This plan was created by a busy mother of 4 and is designed to help you stick to a budget and still feed your family well!

Get my best food saving tips:

Write out new budget goals

Now that you’ve had a chance to really review your budget, write out some new goals based on the original goals you set for yourself at the beginning of the budgeting process.

Hopefully, you were able to find areas where you could create extra money in your budget in order to put toward your budget goals.

If you had a savings budget goal, there is a perfect savings account to get you started. The Savings Builder with CITBank requires $100 per month to be deposited and you get a 2.45% interest rate! That means CITBank will pay you to save money! Get signed up online.

For debt payoff, there is nothing I recommend more than the Debt Snowball. See our full story on how we paid off $6,000 in 6 months.

Start your budget

In my Fun Sized Budget Bundle, my budget printout is crazy simple because I used to do my budget with a piece of paper and a smartphone.

Start at the top of your paper with your income for the week, 2 weeks or month. This method will vary depending on how you get paid.

Start subtracting all of your must-have bills. Subtract your calculated gas amount and grocery amount (because you should be taking this out of the bank in cash.)

When you are done with your budget, you should get to a complete $0 amount. When you do this it means you are in charge of literally all of your money.

Creating a Zero Based Budget means you have spoken for all of your money and you choose where you spend it all.

Now, if you’re like me, and you love hands-on planning, grab my budget bundle to help you in all areas of your finances. If this all makes your head spin, use the EveryDollar app! It literally does all the guesswork for you and you can take it anywhere on your smartphone!

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Creating a simple budget is exactly that. Simple. All you really need is a piece of paper and a smartphone and you're set. Here's how to do it.

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