Creating a budget for your family may seem like a lot of work, but it's not. Read the three steps below to see what information you'll need to gather. Then set aside a couple of hours to calculate, create and review your budget. Remember that when you follow a budget, you're more likely to stay on track in your spending and saving plans.

1. Total your monthly household income
Calculate how much you bring home a month. Income includes:

  • What's left of your paycheck AFTER taxes and deductions, often called “Net Pay” on your pay stub.
  • Cash benefits from Social Security payments, temporary assistance for needy families (TANF), and other public assistance programs.
  • Additional earnings from alimony payments, child support, a part-time job, or other income sources.
  • If your income changes month to month, take an average of the last three months and use as your monthly income.

 2.  Total your monthly household expenses
Make a list of all your monthly expenses. You can use a budget form as a guide. You can also track where your money goes by writing down every purchase and payment you make in a journal. At the end of the month, add up all the expenses.

You'll see that your spending is generally categorized as:

  • Fixed expenses that you must pay, such as rent, electric bill, car payments; and
  • Flexible expenses that change month to month, like groceries and entertainment.

 3. Subtract expenses from income

  • If your income is more than your expenses, consider saving it in a bank account.
  • If your expenses are more than your income, you'll need to think about reducing your expenses or increasing your income.
  • To help keep your fixed expenses at a manageable level, we offer tips on finding the lowest gas and oil prices in Westchester, as well as how to save energy and money. You can also examine your flexible expenses as there may be more opportunities to reduce your spending.