Here Is A Simple Budget Procedure To Follow

A simple budget procedure needs to be easy for the non financial person to follow. That’s right! The procedure below truly is simple and easy to use. Try it.

It’s a New Year and many folks want to get their financial house in order. Some will make, and then break resolutions, as usual … believing this is normal. And it is, for folks who do not turn resolutions to goals with actionable plans.

Simple Budget!
Simple Budget!

This year, if you want to work on your finances, don’t make a resolution; just start working. Here is a simple, first few steps to start today.

For many, it is a big challenge! Where do you start? You have read and heard so much about budgets. You don’t realize it is merely your best estimate of the cost of doing specific future goals in a specific period. For example, next month, you are going to pay rent, buy groceries, probably buy a few shirts, give funds to God; right? Today, you can look at how you might allocate next month’s available funds for those and other activities.

Simple Budget Procedure

  • Get seven 3 inches-by-5 inches cards and seven envelopes. One for each card.
  • On the top right corner of a card, write your gross income and this note: This income belongs to God; He will tell me how much to keep in His Kingdom. Pray and ask Him to show you this amount. On the front of a corresponding envelope, write “INCOME.”
  • Calculate the amount to spend by taking away from gross income, amount to give to God, taxes and other deductions.
  • Write the amount available to spend in the centre of this card and circle it. If gross income is $3,000, giving to God $400, taxes $1,000, then $1600 is available to spend. Write this amount on the front of the INCOME envelope ($1600).
  • On each of the remaining six cards and envelopes, write one of these categories: Taxes and deductions, food, clothing, transport, shelter, and other. Use your best estimate to calculate and allocate amounts to each category: could be taxes $1,000, food $400, clothing $100, transport $200, shelter $700, other $200).
  • Apart from taxes, which your employer will deduct, take cash for amounts identified and place in each envelope. If you prefer not to use cash, ensure you pay your credit card balance in full monthly. Still, when you spend, write details on the relevant card. Each card should show starting budget, say, $400, and each time you spend, you reduce the balance, and record the new balance. And most of all, stop spending when the balance is zero. Next month, resume the process by adding the month’s budget.
  • Before spending, use the Affordability Index and ask God to confirm if you should spend.

This is not a complete budgeting process, it is a start. Feel free to choose other categories. Indeed, to become comfortable with the procedure you could start with two items and add one monthly. Meantime, learn this envelope budgeting system.

Over the next three to six months, as you learn to control your wants and needs, aim to move to the full envelope budgeting system. Tell me how you get along.

For more on budgets and budgeting, read chapters 7-11 of The New Managing God’s Money-The Basics. For more Christian financial advice visit: Managing God’s Money™.

Copyright (c) 2011, Michel A. Bell

Michel A. Bell

Michel A. Bell is a former senior business executive, author of seven books — including his first children's book published in 2022 — speaker, and adjunct professor of business administration at Briercrest College and Seminary. Michel is a Fellow of the Chartered Certified Accountants (UK), holds a Masters of Science in management degree from Massachusetts Institute of Technology and a Doctor of Business Administration honoris causa from Briercrest College and Seminary. He is founder and president of Managing God's Money™ and Stewarding God's Resources.

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