Today, I show you how to create and manage a budget using Mint.com. As a long time user of Mint.com and their budgeting software, I’m a believer that Mint.com’s budgets are their most valuable tool. Using a budget and knowing exactly how much I’m making each month, how much I’m spending each month and what my net income is each month has allowed me to make serious progress financially over the past few years.
Steps to Create a Budget with Mint.com
Here are the steps to creating your own budget with Mint.com:
- Create a budget for your income – At the top of the budget page in Mint.com is the income budget section. For all income sources you have, you’ll want to create a budget category for them. If your paychecks amount to $3,500 each month, you’ll want to create a budget category for your paychecks. To do so, click create a budget at the top left, then go down to income and then find paycheck inside of that drop down. Then mark it as monthly (as you’ll be expecting this money every month), and click save. Create an income budget category for each source of your income for the month.
- Create budgets for all of your expense categories – This will be more complicated. You’ll want to make a budget for each of the categories that you spend money in during the month. I recommend that you create a budget category for each of the following spending categories, at the minimum (if you have these expenses):
- Mortgage & Rent
- Insurance (Both auto and health)
- Gas & Fuel
- Bills & Utilities (Electricity, water and gas bills)
- Mobile Phone
- Entertainment (could be sub categories of this)
- Fast Food
- Alcohol & Bars (if you drink)
- And any others that you spend money in
The point is to make a budget category for every single category that you plan to spend money in this month. You’ll also want to tweak this throughout the month. If it’s the 15th of the month, you initially created a grocery budget of $300 and you’re already at $200, then you will likely want to raise your grocery budget for the month. The point here isn’t to police your spending, but instead try to estimate as closely as you can just how much you will be actually spending this month, in each category.
Calculating Your Income, Expenses and Net Income
The best part of all this effort of creating and managing your budget with Mint.com‘s budget functionality is this box on the top right area of the budget page. Shown there is your estimated income for the month, your estimated expenses for the month and finally, your estimated net income for the month. Each time you edit your budget, it will change this, but the overall goal is to get this as accurate as you can and keep it that way throughout the whole month. This gives you a look at whether you are over-spending or if you will have money left over at the end of the month. Obviously, your goal with budgeting should be to make sure there is money left over at the end of the month.
Managing your budget with Mint.com has absolutely changed my personal finances. I highly recommend you give Mint.com’s budgeting tools a try and see how living on a budget and knowing how much you make, spend and have left over each month can change your financial picture. I bet it will do wonders for you just like it did for me. Stay tuned for additional videos and tutorials on Mint.com in the future as we tackle the Mint.com transactions section to keep all of our income and expense transactions accurate.