If the idea of creating a budget sounds overwhelming or boring, you’re not alone. Millions of people struggle with creating a budget. Creating a budget shouldn’t be this daunting task that you keep putting off. Think of having and creating a budget a starting platform or outline for your finances. And the best part of budgeting is that you can have fun with it and contrary to popular belief, it doesn’t have to be restrictive—in fact, it can be empowering. Whether you want to get out of debt, stop living paycheck to paycheck, or save for your dream vacation, it all starts with one simple step: creating a budget.

Here’s a beginner-friendly guide to starting a budget from scratch, even if you’ve never done it before. Now below should be a simple outline for you to get started and before jumping off into the deep end of your budget, there are a few steps that, if followed properly, will set you up for success rather than just winging it.

Step 1: Understand Your Income

Understanding your income may seem straight forward, but it’s best to break down the numbers so you know exactly what you have to work with. I’d recommend starting with your total monthly take-home pay (typically after expenses like taxes, insurance, etc.). If your income fluctuates that’s alright, just simply average the last 3–6 months or base your budget on your lowest monthly income to stay safe. Make sure to include if you also have a side hustle or any additional income.

Include:

• Salary (after taxes)
• Side hustle income
• Child support or alimony
• Any government benefits

Knowing exactly how much money you have to work with, creates a solid foundation for budgeting.

Step 2: Track Your Expenses

Before you can build a budget, you need to know where your money is going (especially if you are guilty of impulse shopping on online stores, or those late night food deliveries). Track every expense, I mean every single penny, for at least one full month. This includes bills, food, gas, subscriptions, and impulse buys (and don’t feel like you’re being singled out, at one time or another, everyone is guilty of a little frivolous spending from time to time).

Use:

• A spreadsheet (I personally love Google Docs)
• Budgeting apps like Mint or EveryDollar
• Pen and paper (or a word document will do as well. Pro tip: I put mine in an online journal so I can reference it quickly, and add items as I spend so I know exactly where everything goes)

You may be surprised by how much you spend in certain categories.

Step 3: Choose a Budgeting Method

There are many ways to budget, but here are three simple, yet effective and popular ones:

• Zero-Based Budgeting: Every dollar has a job. Income – Expenses = $0.
• 50/30/20 Rule: 50% Needs, 30% Wants, 20% Savings/Debt.
• Envelope System: Use cash for each spending category to control impulse purchases.

Choose one that feels doable for you, and adjust as needed. With budgeting there is no “one size fits all” method. If something isn’t working, feel free to use a different method. Each one works with different financial destinations and you can tweak it as you go along in your financial journey.

Step 4: Categorize Your Spending

Organize and break your expenses down into categories such as:

• Housing
• Utilities
• Food
• Transportation
• Insurance
• Debt payments
• Entertainment
• Savings

This helps you visualize where your money is going and where you can make changes.

Step 5: Set Financial Goals

What do you want your budget to help you achieve? Short-term goals might include building an emergency fund or paying off a credit card. Long-term goals could be buying a house or saving for retirement.

Having clear goals gives your budget purpose.

Step 6: Use a Tool to Help

You don’t need fancy software to budget, but using tools can simplify the process. Try:

• Free Google Sheets templates
• Budgeting printables
• Mobile apps like YNAB (You Need A Budget), EveryDollar, or Goodbudget

Find a method you enjoy using, so you’ll stick with it.

Final Tips for Budgeting Success

• Review and adjust weekly or biweekly
• Give yourself grace when you overspend
• Budget for fun so you don’t feel deprived
• Make it a habit, not a one-time project

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Final Thought: Creating a budget is the first step toward taking control of your financial future. It doesn’t have to be perfect—it just needs to be intentional. Start where you are, use what you have, and build from there. You’ve got this!