Q:  Is there a good spreadsheet or website that you recommend for starting a household budget? – Rick

A:  Rick, as you have probably discovered, there are millions of pre-made forms out there for budget creation.  In my experience, none of them are as good as what you would make for yourself, because no one else has the same expenses or priorities that you do.  For example, I have a line-item on my budget that simply says “Home”.  It’s a generic category that encompasses everything that isn’t food, gasoline, entertainment, etc.  However, you may want to be more specific with your expenses, breaking down this broader category into the more narrow components of clothing, school supplies, and admission to dance recitals.

As a general guideline, start with the major categories that are obvious and easily separated, i.e. home mortgage, electricity, charitable contributions, etc.  You may later discover that you need more categories, or get rid of some that are hardly ever used.  Maybe you need to break-out “Long-term Care Insurance” from the general “Insurance” category, or eliminate the “Travel” line item because you just don’t travel much.  So be flexible in order to accommodate your unique spending situation.  After all, if it doesn’t work for your particular household, you’re not going to use it.  Don’t forget to add lines, and enter budget amounts, for contributions to your retirement accounts and savings/investments as well.

Once your spreadsheet is made, and you’ve been using it for a few months, start looking for trends.  Is your grocery expense spiraling upward because you keep throwing away expired food from the refrigerator?  Is your entertainment expense consistently over 5% of your gross income even though the national average is only 4%?  Or for that matter, are you spending more than you make on a regular basis?  

Simply tracking where your money goes each month makes you dramatically more likely to meet your financial goals, but only if you keep looking at it.  Good luck!

Q:  Our daughter is graduating from college soon, and my wife and I are trying to figure out how best to help her get started financially.  Any thoughts? - Stanley

A:  There is no question that this time of life is fraught, and helping children through it is rarely easy.  Depending on your daughter’s history with spending and saving, you may find it makes the most sense to shoulder a few of her initial financial obligations yourself, rather than simply giving her money.  One benefit of doing this is that it allows you to see what her various expenses are and choose one that works well within your budget.  If your own financial situation is tight, you may offer something small, like paying her cable or electric bill for a few months.  Or, if you have the wherewithal, you could offer to take on responsibility for her rent.

I’m a big fan of incenting people to push themselves in the right direction, so you might offer to match whatever she saves in her company’s 401k plan.  This motivates her to live frugally in order to maximize her own contribution, and therefore your match.

If she hasn’t already started an investment account, this might be a great time to start one with her.  Even if your daughter isn’t in a position to contribute to it herself on a regular basis, you could do so with any money that you might otherwise have spent on the latest electronic gadgets for birthdays or Christmas.  In the long-term, she’ll appreciate the extra shares of a growth mutual fund much more than an iPad mini whose technology will be obsolete in six months anyway.

Finally, don’t be afraid to take this question directly to her as well, as long as you’re willing to potentially say “No” to her response.  She might have some ideas that you’ve not thought of, but that she would find extremely helpful.  If you don’t like any ideas that she mentions, be willing to keep negotiating.  She’s an adult now, and she needs to be able to accept whatever you are willing to do for her graciously.   

If YOU have a question for Ask Eric, send an e-mail to AskEric@mail.com.


— Eric Litwiller has spent the last seven years helping people achieve their financial goals through the use of budgets, retirement vehicles and estate planning options. Prior to his current position in fund development at Friends University, he worked for a faith-based financial services firm. He is a firm believer in the importance of using Earthly riches to fulfill a mission of Christian stewardship. He is not a licensed financial planner.