How to Make a Household Budget in 4 Simple Steps


You’ve heard the saying “love is blind,” but when it comes to your partner’s financial status you should take those blinders off before you take the plunge and say I do.

Follow these 4 steps with your partner to avoid any ugly surprises after the honeymoon ends. Once you’ve discussed these 4 steps you can put those blinders back on (you might be glad you have them in about 10 years!)

Step 1: Begin the Discussion

Come prepared to talk openly and honestly with each other about your personal financial circumstances. Make sure that each of you know how to make a budget, if you don’t consult a professional. It’s important that you do this without blaming or judging one another; remember you’re in this together now. This is the time to lay it all out on the table, don’t hide anything like debt or bad credit from your partner. It will only come back to haunt you later.

Here’s a list of questions to ask each other. These will help you understand the financial make-up and mindset of your partner before you dive into specific numbers:

  • How did your parent’s make a household budget? Did they talk to you about money?
  • Are you a spender or a saver? How do you decide whether or not you should buy something?
  • What does money mean to you and how much is enough?
  • What kind of lifestyle do you want? What are your goals or dreams? Example: Do you want to travel to exotic places or is early retirement more important?
  • Do you both want to work or go to school? Do you want kids? Is it important that one of you stay home with kids?

Step 2: Look at the Numbers

Figure out where you are now so you can set some goals for the future. What is your credit score, potential combined income, debt, loans, bills, etc? Crunch the numbers and set a household budget. If you aren’t sure about your categories, track your spending for one to two months and then start a household budget.

If you’ve already determined that one of you will stay home to raise a family, it’s important to not include that person’s income when budgeting for your future together. If you can get by without that second income, try putting it in a savings account. That way you will not become accustomed to having the extra money and you could have something to fall back on should you need it.

Step 3: Budget and set Goals

There are a lot of different ways to set up a budget, such as using Excel, Quicken, or Find one that works for you and commit to sticking to your household budget.

Dreaming of the future is exciting, but without a solid plan you might lose focus or fall into unwanted debt. Decide on these goals now so you can succeed in following your dreams:

  • Determine your wants vs. needs
  • What is your spending limit on big-ticket items before you need to consult your spouse? $100? $1,000?
  • Commit to each other to live on less than you earn, or as mentioned above, learn to live on one income. This sounds simple but is an essential step to any personal budget, but even more vital to the success of your household budget.
  • What will you do for income in the event that anything should happen to your spouse in the future?
  • Plan regular budget meetings. Who will pay bills? Are you on track, does your budget need any adjustments?
  • How will you handle friends and family who need or ask for money?
  • Now the fun part, set a few goals for your future. How much do you want in savings? Do you need to save for a down payment or a big trip? How about retirement?

Step 4: Ask the Professionals

Take a class or read some books together to learn additional financial skills. Consult an accountant to discuss how you should file your taxes once you are married and if you need to make any adjustments on your withholdings. Update any insurances or policies or obtain necessary insurance you need, such as health insurance or 401(k).

Do you have any suggestions on how to make a household budget? What has worked for you? Let us know in the comments section below. Also, keep an eye on our blog for more great tips on ways to budget and save money.

Comments are closed.