Jeff from Maryland writes: My wife and I would like to use some kind of simple budget program on the computer. Can you give any suggestions or what you use? Thanks for your help.

Tawra: Mike and I use a paper budgeting system, listing all of our income and expenses. We don't recommend using complex computer programs, like those that require you to enter every receipt for every purchase, though a simple spreadsheet works well. If you make things too complex, you will get frustrated with it and quit.

Here is a recent example of our budget. We rarely have to look at it, since we pretty much have it memorized. The budget just gives a guideline for spending. We tend to re-make the budget whenever we have a significant change in our income so we can determine what we need to cut or where we'd like the surplus to go. If you have an increase in income and don't budget it, you will find that the money will get spent even if you don't know where it goes, so it is best to decide where you want it and budget accordingly.

For our readers, we have created a simple version of our form that you can download and use. We have three versions available (below). If you prefer to have the form perform the calculations and you have a program that can use Excel files, the Excel Budget form below will calculate your income and expenses and also project your budget surplus or shortfall.

Budgeting is really not complex. In a nutshell, you list your income and your expenses and adjust everything until your expenses are less than your income. If you have a low income, you may need to cut things you'd rather not cut. If you are very perfectionist, budgeting can really drive you crazy since it is not a precise science.

Generally, you want to estimate your income and expenses in each area on the budget. If you have precise information, like a regular specific dollar amount for your paycheck or your mortgage, enter that amount. If you haven't been using a budget regularly up to now, you will have to estimate for things like "general merchandise" which includes non food items not listed in other categories. I often call this the "Wal-Mart" part of my budget because it is for general household goods. Don't use this category for fun stuff. That should go under social/entertainment or if you like, create your own category.

When you estimate budget items, always estimate high. It is always better to have too much money at the end of the month than not enough. Once you get some practice budgeting, you will be able to more precisely estimate your expenses.

If you have trouble tracking small expenses, like purchases of convenience store soft drinks or bubble gum, try the envelope system. After you make your budget, make separate envelopes for each budget item. Put a set amount of money in each envelope and then when the money is gone, don't spend any more until the next month. If you end up with extra money in any envelope at the end of the month, add it to your savings or use it for something special. Never use money from one envelope to fund things in another envelope.

The envelope system can help you identify areas where you typically spend more than your budget. Most people spend much more than they realize on small "nickel and dime" items. If you keep yourself to a set spending limit for these items, you'd be surprised how much you can get from your budget.

Here are the budget forms.

-Michael and Tawra

Budget Forms for Download

Monthly Budget Excel File (performs calculations if you use Excel or Appleworks.)

Monthly Budget - Word Document (You can enter Data into fields, but must do the calculations yourself)

Monthly Budget - PDF File (A Form you can print to help you budget manually)