Basic Budgeting

When you were in High school or even college did you know and understand how to use a personal budget? Do you know how to use a transaction register? Can you find the routing number on your checks?

I have heard a lot of talk on social media and even on radio talk shows about how college graduates and high school students are not taught the basic money management skills, this includes balancing their checkbooks. I took my daughter to the bank, not only did she admit that she did not remember what she was taught, and the personal banker also said when she started working at the bank many years ago, she too did not know how to balance her checkbook.

As the business world has become more and more transparent there is a need for all employees to understand the basics of budgeting. Everyone needs to understand the value of having and following a budget. When the word budget is mentioned it can take on a negative connotation, invoking the image of pinching pennies. A budget is a tool to get a better insight into your spending habits and helps you plan for future goals.

The more individuals understand how to handle their budgets the better equipped they are to handle business budgets. Income, expenses, fixed costs, assets, salaries, hourly wages, taxes, accounting services what does this all mean and how do they work together to build a budget?

Let’s break it down. Everyone takes money in; this is your wages/salary. Each month you have the same bills of money going out as well as a few additional ones.

Do not spend more than you make!


Basic Individual/Household Budget



Investment Income

Child Support/Alimony

Expenses Budget Actual Difference


Health Insurance

Charitable Donations


It is important to pay yourself this can be used for rainy day fund, seasons expenses like Christmas etc.

Homeowner’s/Rental Insurance

Automobile Insurance

Automobile Loan

Property Taxes



Auto repairs/maintenance


Student Loan

Credit Card Payment

Natural Gas


Cable / Internet


Child Care

Dining Out

This is one of your greatest daily expenses when you track and add it up.


Gym Membership

After you have listed all your outgoing expenses and their amounts, if the total is more than your income, there is a problem and you will need to make adjustments.

A budge helps you understand where your money goes. Developing a budget also helps you reach goals, such as saving for retirement, building an emergency fund, buying a house, paying off debt, purchasing a vehicle, saving for college, saving for a vacation, etc.

In today’s world with auto bill pay and debit cards very few checks are written. It is still vital to keep track of all your purchases. Utilizing the Transaction Register is a tool to assist you to keep your account from being overdrawn.


When you understand how a personal/household budget works it makes it easier to understand a business budget. There are numerous tools and apps out there to assist you. You can create a simple table in Excel, or use the app Mint.  In our places of employment, all the staff to understand that businesses need to follow budgets as well and that everyone can work collectively together for the growth of the business.

Cheryl Viola, MBA, Executive Director