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Budgeting finance

What Category Do I Start With For My Budget?

Jason writes in: “My family and I are trying to figure out where to even begin with budgeting. What category do I start with?”

Thanks for writing, Jason. Where you start is going to depend on you and your family. Specifically, it is going to depend on where you are on your journey to becoming debt-free, as well as your family’s values.

A good place for anyone to start with the budget is the essentials: you have to eat, you have to keep the heat/air conditioning on, you have to keep the lights on, and you have to pay rent/mortgage. If you are really struggling to get by, that is where your budget will start every month until you have breathing room.

If you and your family are having trouble staying above water, then you will be living as frugally as possible: no going out to eat, working extra hours, or even taking a second job.

But if you are not struggling, then you may want to consider broadening your budgeting categories. You might start with charitable giving. If your family values helping others, then this would be a good place to start as it puts your values on the forefront and helps to change your mindset toward money.

If you struggle with saving, you may want to make the first and second categories Long-Term Savings (Retirement) and Short Term Savings (Emergency Fund, New Car Fund). This makes it easier to save so it isn’t something that is on the back-burner but instead is something that you do at the beginning of every month with little thought.

The most important thing to remember is that budgeting is a personal process and everyone will have different categories, values, and percentages set aside for every category. The important aspect of this is remembering to even start the budget. Knowing where your money is going is the first step to changing any potentially bad behaviors. It is also potentially revealing as to what your family values.

Thanks for reading. What category does your family start the budgeting process with?


This article does not constitute legal, financial, or tax advice. For specific information on budgeting and helping your family get out of debt, please consult a local professional.

By Foxx Financial

We are focused on financial literacy and a want to help others grow assets, reduce and remove debt, or just understand financial concepts better.

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