Budget, Money Management

What Works For Me – Budget Categories

There are dozens of budgeting products on the market.  I’m partial to the You Need A Budget system, but there are other great systems available.  Find a system that works with you, fine tune it to meet your needs, and then use your budget as a tool.

After selecting a budgeting system, it’s important to create specific budget categories.  When I first started budgeting, I had way too many categories.  I tried to be too specific.  Instead of managing my money, I just ended up spending time working on my budget.  If you have too many (or too few) categories, you might grow frustrated with your budget, and you might simply ditch it altogether.

What Works For Me – Budget Categories

I divide my budget into three major categories – spending, saving, and giving.  (I create a budget based solely on our household take-home pay.  In other words, I do not include pre-tax retirement contributions or employer deducted health insurance premiums.  Also, I live in a house provided as part of my compensation.)  I then divide the three major categories into the following budget categories and sub-categories.



Electric Bill

Cellular Bill

Telephone Bill

Satellite Bill


Medical Bills


Child Care


Baby Sitters


Grocery Store

Eating Out


Family Nights

Miscellaneous Spending




Routine Maintenance



Roth IRA 1

Roth IRA 2






Automobile 1 Replacement

Automobile 2 Replacement

Automobile Repairs


Furniture Replacement

Appliance Replacement

Future Home Purchase


Automobile Insurance Premiums

Disability Insurance Premiums

Renter’s Insurance Premiums

Additional Savings





Special Offerings




Basically, I have 15 budget categories, with most categories broken down in to two or three sub-categories.  (Once in a while, I’ll add an extra category or two, depending on circumstances.  For instance, for a long time, I was saving for a new lawn mower, so there was a specific savings category labeled lawn mower.)

For me, and my family, it works best if we limit our number of budget categories.  I find that this makes things a bit more manageable – and more user-friendly.  (If you have irregular income – and most folks do – I suggest you read this post:  How To Create A Budget If You Have An Irregular Income.  You’ll find information for setting up a budget, even if your month-to-month income fluctuates.)

What About You? –

I’d love to hear from you, my awesome readers.  How many budget categories do you use?  Have you found that you like a super-simple system, or do you prefer something much more complex?  Leave comments here and / or connect with me via Twitter.

3 thoughts on “What Works For Me – Budget Categories

  1. I used to have about 20 budget categories but for the sake of simplicity, I’ve since narrowed it down to about 6. This works alot better for me and I am more likely to stick to a simple budget that works.

  2. I had way too many categories at first but as I got better with managing my budget and my cash flow I got it down to 7 categories. Mine are mostly like yours NCN except that I put the car insurance under the car. My health and medical insurance are taken off before the check hits the bank so I don’t count those.

    My categories are as follows:
    Home (rent, insurance, water, pet rent)

    Car (gas, maintenance, insurance,loan payment)

    Utilities (cell, internet, cable)

    Household (food, personal items, pet care)

    Credit Cards (payments on the cards with balances at 0%)

    Miscellaneous (church, irregular expenses,small personal loan, school bills that come every weeks for my masters class, any overage at the end of the month in my checking account since I have a zero based budget)

    Savings (emergency fund, money market)

  3. A bit too long for me, but an excellent and practical budget layout. No way I can start with all of these, I would add 5 more before filling out the spreadsheet.

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