The Five-Minute Budget

By Tjaden Sinclair, certified financial counselor
The Village Family Service Center

If you don’t feel like you have enough time in your life to put together a budget, I suggest the five-minute budget. The five-minute budget isn’t as detailed as most financial gurus would like you to have, but it is quick and will give you an opportunity to get a good picture of your financial situation.

1. Visualize in your hands all the money you have to work with each month. This is the money you have available to meet your needs and reach your financial goals.

2. On a blank sheet of paper, list all of your expenses in their order of importance.

House- $1700
Food – $350
Car- $420
Utilities- $155

I just threw out some numbers but you get the idea, list as many of your expenses as possible, and list them in order of importance to you. Each of us will have a different value system and will order our expenses based on that system.

Don’t forget to include bank loan and credit card payments (if you have them.)

3. On the top of the page list your income. Use take-home pay as that will give you the money you have to work with each month. Subtract the first expense from your monthly income and put the new total to the right of that expense. Then subtract the next expense from that number and on down the list.

Example: Subtract house payment of $1700 from your income of $5,000, leaving you with $3,300. Now subtract your $350 grocery monthly expense from $3,300, leaving you with $2,950. Now go to your monthly car payment of $420 leaving $2,530. Continue to do this until you have covered all your expenses or until you have run out of money.

4. Now go back over your expenses to determine if they are necessary or a priority–can they be cut or decreased? Revise the numbers as you make changes in your expenses so you can get yourself to a positive number after living expenses and obligations are covered.

5. Take the money you have left at the end of the month after meeting your priorities and divide by 4. This is the “fun money” you have to spend each week for entertainment, eating out or going to the movies.

Once you have all the numbers in place you will very quickly realize when and how each of your listed expenses are paid. I suggest that you use our Cash Flow Calendar to keep track of the due dates of your bills.

The five-minute budget can be a great start for your financial plan. If you are interested in a more detailed plan, subscribe to the Real Money blog or go to  for additional tips.

If completing the five-minute budget makes you realize that you cannot meet your monthly living expenses and debt obligations without supplementing with credit cards or additional borrowing, contact The Village Family Service Center at 1-800-450-4019.

Thank you to my fellow financial counselor, Duane Emmel, for bringing the five-minute budget to my attention.

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