Family budget template for Excel

Family budget template for Excel

The first time a family sits down to look at the household money, the surprise is usually uncomfortable: nobody knows exactly how much came in last month, how much went out or where it went. The figures live scattered across receipts, messages, withdrawals and a few loose notes, and by the end of the month all that is left is the feeling that something does not add up. This template attacks exactly that point: it is not trying to make the household earn more, it puts the household figures in one place, month by month, so that decisions stop being guesses.

A family budget is an internal control tool. With the twelve-month grid you type each item once, column by column, and the sheet does the rest: it adds up the income, adds up the expenses, works out the result of every month and chains the running result for the year. Then the comparison sheet places the amount that had been planned next to the amount that was actually spent or received, so the difference is visible before it turns into an argument.

It is built for families and for people who want their money in order without complicating their lives: couples who share the household bills, people living on their own, households with children and also small family businesses that mix the shop money with the house money and need to keep the two apart. You do not need to know Excel: if you can type a number into a cell and move around with the arrow keys, you can already use this template.

What it is and what it is for

• See the whole month at a glance: income at the top, expenses below and the result for the month on a single line.
• Compare planned with actual: the second sheet puts the yearly budget side by side with what was really spent or received.
• Spot the drift in time: the difference column and the percentage used column show which item went over and which one fell short.
• Look at the year, not only the month: the running result chains the twelve monthly results and shows how the year is really going.
• Treat savings as one more expense: the savings row is budgeted like the rent, so it stops being whatever happens to be left.
• Keep a record: once the year closes, the file stays as a log of how the household money moved.

What the file includes

A worked example

To see how it works, imagine a household that receives a salary of 3,200,000 and other income of 300,000 every month. That makes 3,500,000 coming in each month. On the other side, the expenses are split like this: 900,000 for housing, 700,000 for food, 300,000 for transport, 250,000 for utilities, 200,000 for education, 150,000 for health, 300,000 for debts, 300,000 for savings and 100,000 for other expenses. The total is 3,200,000, so the result for the month comes out at 300,000.

If that month repeats through the year, the annual expense reaches 38,400,000 and the running result for the year closes at 3,600,000. That is the figure the sheet builds month after month and the one the check line guards: the yearly total has to be both the running result of month twelve and the sum of the twelve monthly results, and the check warns when the two figures do not match.

The second sheet tells the other half of the story. There, food had been budgeted for the year at 8,400,000 and the actual figure was 9,000,000: the difference is 600,000 over the plan, and the status that belongs to it is the over one. The percentage used for that item comes out above one, which is exactly the warning sign the sheet is meant to give.

At the bottom of that sheet sits the summary by status, which gathers the items into three blocks: the ones that stayed within plan, the ones that went over and the ones that came in under, together with the total difference. That summary is the first thing worth reading, because it says at a glance whether the year went wrong on one isolated item or whether the whole structure of the spending shifted.

How to use it, step by step

Before you start, save a copy of the file under the name of the year. That way, when the year closes, the record is already kept and you can start the next one from scratch without deleting anything.

1. Fill in the year and the currency at the top, and a savings goal for the month if you want one. The template carries no currency symbol, so it works in any country.
2. Type the household income for every month, keeping the salary or main income apart from the other income.
3. Type the expenses month by month, item by item. Leave the months that do not apply empty instead of writing filler zeros.
4. Look at the result for the month row and at the running result row: that is where you see whether the household is spending more than it receives.
5. Move to the Actual vs planned sheet and type the budgeted amount for the year and the actual amount of every item.
6. Pick the status of every item from the drop-down list. The difference and the percentage used are calculated on their own.
7. Read the summary by status: it gathers the items that stayed within plan, the ones that went over and the ones that came in under.
8. Adjust the following month with what you learned. The template can be reused as many times as you like, in different years too.

How to read the result

The first thing to look at is not the yearly total but the result of each month, because a bad month can still be fixed in time while a bad year cannot. If the result for the month is positive, the household spent less than it received; if it is negative, that month was covered with savings or with debt. The second thing is the behaviour of the running result: even when each month looks small, three or four months in a row in the red change the picture of the year completely. If the running result keeps falling month after month, the problem is no longer a single expense but the size of the fixed costs.

After that, it pays to go down to the individual items. On the comparison sheet not every deviation weighs the same: going over on food or transport is usually correctable the following month, while going over month after month on debts or leaving savings at zero are signs of a structure that cannot hold. A good habit is to review only three or four items per month, in order of importance, instead of trying to fix everything at once. The exercise pays off more when it happens on the same day every month, and much more when the whole family looks at it together.

Common mistakes

• Writing zeros where there is no data: months with no movement are left empty; a filler zero distorts the totals and the comparisons.
• Budgeting round numbers that do not exist: if the real expense is never a round figure, write the value closest to reality and adjust it later.
• Forgetting the expenses that do not come every month: quarterly or yearly payments belong in the grid too; spread them or place them in the month when they are paid.
• Not budgeting the savings: if savings only get filled with what is left over, hardly anything is ever left over. It is an expense line like any other.
• Leaving irregular income out of the grid: seasonal work or variable income is spread across the months instead of being piled into a single one.
• Keeping the template closed: a budget only works if it is reviewed. Ten minutes once a month are enough to keep it alive.

When it is worth moving to a system

A spreadsheet covers the household very well: there are few rows, the figures are looked at once a month and sharing an open file is enough. But there comes a point where it stops being comfortable. When several people type at the same time, when income arrives from several places and changes every week, or when the budget has to be checked from a phone, the sheet starts to raise doubts: nobody knows for sure which is the latest version or who changed which figure.

That is the moment to think about a management system. Kardex Tauro helps above all when the household money crosses over with a small business, because besides internal control it keeps inventory, purchases and accounts in the same place where the figures are read. As long as the family only manages its own money, this free template is more than enough; the change is justified when several people come in, several businesses appear or everything has to be checked from the phone.