After I graduated college, I received an inheritance check for $30k. About a year later, I blew it all.
I used the money to move out, get a new car, eat out constantly — all while telling myself I’m going to be making $10k a month before I know it as freelance marketer.
Yeah, that didn’t work out (but didn’t turn out so bad).
Every month I knew I was spending more than I was making, but I was too scared to look at my bank account or my credit card statement. Just click pay.
It took me wasting all my money and having only one month left to survive on my own to push me to get a real job and start budgeting. If you can learn from my mistakes, you won’t need to let it get this bad for you.
How did I get my finances back on track? As you can tell by the title, it was from creating a budget and sticking to it. It has changed my life and reduced a lot of stress. I’m hoping I’ll be able to help other people facing the same stress I had by turning my personal monthly budget Google Sheet into a template and sharing it here.
Here is my number one tip: First get your mindset right and understand what a budget is REALLY for:
The ultimate goal of a budget is NOT to see where your money is going, but to create a change in your behavior to spend less money on stupid shit.
The Reason Doing Your Monthly Budget on Google Sheets Will Drive Behavior Change to Spend Less
It forces you to enter your expenses manually. Although seemingly tedious, I found it to be the most important exercise.
Entering expenses manually forces you to review every transaction, to feel the pain of every dollar spent — that is what will drive a change in your spending.
And something tools like Mint that try and automate everything are terrible at doing.
The other benefit is you’re forced to self categorize each transaction, which means they’ll be more accurate and useful for budgeting.
I’ve been using Google Sheets to manage my personal budget for nearly five years now. And after much tinkering and revisions, it’s the most beautiful and easiest to use I’ve made yet.
Download My Simple Google Sheets Budget Template
Click the link below and click the ‘make a copy’ button to save the template to your Google Drive.
Instructions for how to use it are below, but first…
Why my Google Sheets budget template is so simple to use
I included easy-to-follow prompts to make it super simple to get started.
Once you enter your income and set up your budget, all you need to do is enter your account balances one a month and your expenses.
Everything else other than entering expenses is automated.
Once you’ve been using it for a few months and get some data in there (or enter historical data) you can use this chart to see how you’ve been spending vs your budget by each category or in total.
Instructions: How to Use My Google Sheets Budget Template
Once you’ve copied the budget template, watch this video which for step-by-step instructions or read below to learn how to use the template and get started.
I. Enter your income
In the top left box on the Dashboard tab, enter your income. Follow the orange colored cells as cues for which part to fill out. If you don’t have a 401k or a Recurring Income #2 (additional income), you can leave those sections blank.
Any income entered here will be added to your available budget. If you do receive any kind of extra income, you may either be putting it all in savings, part of it in savings, or you need all of it for your expenses. Unless you’re comfortable with Google Sheets and spreadsheet formulas, this budget template is only made for two sources of income. If you have more than one additional income source, you can sum both and enter it as one number in the Recurring Income #2 cell.
If you need all or a portion of that extra income, you need to add it to the Recurring Income #2 cell. If you save all of it, you can still add it if you wish (and offset it later by increasing how much of your income is sent to savings) or you can omit it.
Once this section is completed, you’ll get your Net Total Income, which is how much net income you have left over to spend, put in savings etc.
II. Enter Monthly Recurring Expenses
Below the Income box is the Monthly Recurring box.
The first item is Savings to help you prioritize setting money aside for savings to help you “pay yourself first”, a very effecitve wealth building strategy.
“The goal [of pay yourself first] is to make sure that enough income is first saved or invested before monthly expenses or discretionary purchases are made.”
Then you can start adding recurring monthly expenses. These are monthly expenditures that are typically the same amount every month. Examples include rent and utilities, car payment and insurance, phone bills, gym memberships, Netflix/Spotify, etc.
After this, you’ll be left with your Net Spendable Income, which tells you how much you have left for discretionary spending for food, shopping, going out, and other expenses. But first, there’s one more step until we get to creating our actual budget: annual expenses.
III. Enter Annual Expenses
The strategy behind including annual expenses is so you can set aside a monthly amount of money to prepare for when these big expenses come up. Start by adding in things you pay once a year for in the Annual Recurring box. Some examples are car registration, vacations, gifts, car maintenance, credit card annualy fees, Amazon Prime, etc.
After you entered in all the annual expenses you can think of, the budget template will divide the total into a monthly amount as a line item back in the Monthly Recurring box. Now you have your final Net Spendable Income amount we can use to start budgeting.
IV. Create Your Budget
Now that you know how much money you can comfortably spend after savings, monthly recurring expenses, and planning for future annual expenses, you can create your budget. In the Monthly Budget box, enter categories of expenses and an allotted amount. Some examples include eating out, groceries, going out, shopping, coffee, alcohol, personal care, gas, etc.
Thanks to some clever Google Sheet conditional formatting, the budget template will sum your Total monthly expenses. If the Total is green, your expenses are under your Net Spendable Income. It will be red if it’s over and you will need to readjust your Monthly Budget or consider eliminating or reducing some of your monthly or annual recurring expenses.
Note: Before we can get into the Summary, Spent vs Budget, and Expenses Last 7 Months boxes, we need to run through the other spreadsheet tabs in the budget template.
V. Recording Expenses
One of the presumably biggest downsides of a doing your personal budget in Google Sheets is that you have to enter your expenses in manually, but this is a blessing in disguise. Entering your expenses manually has had a big psychological effect on me that gets me to spend less. It forces ou to “feel the pain” of every dollar you spend.
So on the Expenses tab you’ll enter each of your expenses. One row per one expense.
You’ll see some instructions in red at the top for more information. Across the blue row heading, the budget template auto populates your Monthly Expenses categories from the Dashboard tab. When you enter an expense, start with the date in Column A, the name of the place you spend the money in Column B, and then tab over to the column with the expense category that best matches how this expense should be categorized. If it’s an annual expense, it’s the same exact process - just make sure you’re in the right annual expense column.
Note: It’s important you don’t change the order of your items in the Monthly Expenses box because the column you entered the expense under isn’t locked to the expense category.
Why are the expense categories in different columns instead of writing in/choosing the expense category in a single category column? For two reasons. One, it’s much faster to just ‘tab’ over to the right expense category column than writing it in or switching from keyboard to mouse to choose the right category from a dropdown. Second, it allows for less process-heavy formulas making the spreadsheet more smooth to use.
Note: When choosing the date, it doesn’t matter whether you choose the transaction date or the posted date (if pulling from a credit card), but you should stick to one or the other. I prefer posted date.
VI. Tallying Up Assets and Liabilities in the Balance Sheet
Now onto the Balance Sheet tab of the budget template. This is where you will add up all the money you have and owe in your accounts. This will ultimately tell you if your wealth/net worth is increasing or decreasing. Make sure you’ve filled out the preliminary Dashboard steps first (see points 1-4 above).
Note: Because this is counting the actual numbers in your account, you don’t necessarily have to record every expense. Sometimes there are expenses that don’t quite make sense to include that could throw off measuring your spending. But don’t worry, as long as the Balance Sheet is accurate, measuring your wealth/net worth over time will still be accurate.
To start, name the accounts in Column A (mostly the savings accounts and assets). Examples of savings accounts can include primary, emergency fund, and vacation fund. Assets can be your car, credit card miles, 401k, IRA, stocks, etc.
Note: Unless your comfortable with Google Sheets formulas, this spreadsheet doesn’t support changing the purpose of the accounts that are listed there. It’s okay to not use any of them, but not okay to add or change the purpose of an account.
Once you’ve named your accounts, follow the below steps:
- Enter your starting date in cell B1. Dates are entered in the format of 1/1/2018 (the formatting will display the month’s name and year). In cell B1, enter the date of the oldest month you want to start your budget. In most cases, you’ll enter the 1st of the current month or the 1st of last month. You can start further back if you wish, but it will take extra work to calculate historical balances of your accounts. Then in cell C1, enter the 1st of the following month. Then continue adding the 1st of every subsequent month until you reach the end of row 1. Once completed, the orange instructions in cell A1 should disappear.
Now you’ll have a header row in row 1 with the month and year. The numbers you will fill out in the column beneath a month must be the balances at the end of that month. So forget that you used the first of the month in the heading - the reason for that was just to get the month and year to display and to make some formulas work. Just remember, the numbers under a month’s column in the Balance Sheet represent where those accounts stand at the end of that month.
If you’re starting your budget this month, you don’t need to fill out the numbers in the Balance Sheet yet. It’s easiest to do this soon after the month ends, either one the 1st of the following month or at least within a few days of it ending. Then all you need to do is pull up your online banking and fill out the balances for all your accounts, credit cards, loans, retirement accounts, etc. Remember, the numbers in these columns represent how you stand at the end of the month.
Any row that has a - in the cell means these numbers are auto calculated with Google Sheets formulas. Grey shaded cells are intentionally left blank due to the nature of what it’s calculating (for example you need 3 months of data before it can calculate a 3 month rolling average). Here’s what the Assets & Income section will look like once you have some data in there:
- For Rent Due in row 30, I always set to $0. Rent should be paid on the 1st and I don’t like to include it as money owed. If I’m filling out the Balance Sheet for a month where rent hasn’t yet been deducted from my checking account, I’ll subtract it from my current checking balance for a more accurate representation of my month’s finances. I do the same thing for credit card payments when it applies - pay my credit card and if it hasn’t been reflected in my credit card or checking balance, I manually subtract the amount from my credit card balance and the amount I paid from my checking account. Here’s what the Liabilities section looks like with sample date.
- The categories under Monthly Expenses starting in row 36 are auto populated from the Dashboard tab. The sums of each category are then auto calculated from the Expenses tab so you don’t need to do anything here. The same is true for Annual Expenses starting at row 50. If you spend in an annual expense category, it won’t count towards your monthly budget and instead will pull from the future “pool” of money set aside for annual expenses you decllare in the Annual Reccuring box on the Dashboard tab.
- The last section is the Totals section that brings everything together to calculate your net checking balance (money in checking minus current credit card balances) and your net worth. In row 72 you can leave notes for yourself if something unusual occurred in a given month. The word “Notes” will auto populate in each month, but to leave a note, right-click the cell and select “Insert note.”
And that’s all you do the Balance Sheet at the end of each month. As you use this Google Sheets budget template each month, more data on the Dashboard tab will start to populate and be useful.
VII. Net Worth Summary
Back on the Dashboard tab, the Summary box will show an overview of the most recent balances you entered on the Balance Sheet tab compared to the previous completed month. Then it also compares your Latest with the previous 3 Month Average, which makes it easy to see if your money is increasing or decreasing. You’ll need at least 4 months of completed data for the Summary box to completely work. Don’t worry or change any of the formulas here if it throws an error.
VIII. Spent vs Budget
Further down the Dashboard tab, you’ll see the Spent vs Budget box. This is a graph that compares your spending in each category to the budget you set for that category in the Monthly Budget box. Use the dropdown selector in cell P30 to change the category or choose ‘Total.’ This graph shows the previous 7 months of data so it won’t be fully complete until you have at least 7 months of complete data. Again, don’t change any formulas or the chart as it will still work fine if you don’t have all 7 months yet.
IX. Expenses Last 7 Months
Below the Spent vs Budget box is the same data but in a table format in the Expenses Last 7 Months box. This is another way to compare your spending vs budget by category. Amounts will be red where you overspent.
Bonus Budgeting Tips
A budget is only good if you update it consistently, keep it accurate, and spend time analyzing your spending. That’s why I made it a point to make it look nice, be easy to use, and be rewarding.
But sometimes that’s still not enough. There’s definitely been times where I don’t do it for a few weeks at a time and the more you wait, the more work you’ll have to do, and the more you won’t look forward to it. I‘ve made it a habit to log my expenses every Sunday vs once every month.
If you believe a budget will help you get control of your spending, read this guide on how to stick to new habits:
Another tip is to use a credit card for all transactions when possible. Using a credit card makes it much easier to keep track of your spending and at the same time protects your bank account from fraud, builds your credit, and you can earn points and rewards.
Let me know what you think of the spreadsheet. If you found some places where I messed up or have ideas for new functionality, let me know on Twitter.
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