This is my experience  learning to create a budget and understanding my finances. Please note I  am no writer nor financial adviser. I’d like to thank a few Medium  posts (can’t list them, there have been a lot) as well as the Personal  Finance subreddit.

At first, creating a  budget seemed daunting. Money? What is it! I am thankful for two things:  my family being open about our finances and having a curiosity of my  own finances to do independent research because I was not taught the  “basics” in school.

I thought of my budget  in four stages: how much do I spend, how much do I make, what do I  need/what do I want and what is my financial future?

An open source program called GNUCash has really helped me with this process. The program has built-in  reports, graphs, and very easy to use. A big step up from a terrible  spreadsheet!


To even start a budget, I  needed to know what the hell I spent my money on! Nearly impossible to  create a budget without that knowledge.

Like many, I have  reoccurring static expenses like a car loan, phone coverage or  insurance. Then, there are dynamic expenses, food, entertainment and  fuel. By breaking it into categories it was easier to understand what I  was buying. I knew my static expenses would not change per month and I  can look at historics for the dynamic expenses! A fantastic first step!


My budget excludes  overtime and bonuses, I cannot rely on those as a steady income (nor  should you!). I include my 10% 401K contribution as well. This keeps my  budget easy to read and excludes predictions.

I can either count  side-money or throw it in the “spend as you will” bank account. I do not  get a lot on the side, so I do not keep track of it.

Needs & Wants

As I broke out where I  spent my money, I could see my needs and wants forming. The process of  determining which is which was difficult. Do I really need my small  website to have an SSD on Google Compute and DigitalOcean?

By seeing my needs &  wants written out, I could make a smarter, more informed decision. I  wrote them in a bullet-point list and for the low-ranking ones I tried  to do without them for a short time frame. Spoiler alert: they got  eliminated from my expenses.


Determining what I  should keep and what should be tossed can help increase my expendable  income. This (hopefully) new found income can be used to build up my  emergency fund, pay off debt, save for that down payment or even thrown  at my retirement funds.

I have been able to  create a decent sized emergency fund and reach a general goal of  financial independence. Both concepts are nearly the same in my mind. I  am grateful for the ability to not have to worry, “Do I have enough  money to fill up?” The independence has given me the flexibility of  splurging here and there.


I understand my  situation is totally different from yours. I live in a low cost of  living and I am a homebody. I hope my budget philosophy will still  assist you in taking control of your finances.

By learning  how much you spend, tracking what you earn, determining your needs  versus wants, and planning for your future, you will be in a better  financial spot to do what you want in life…maybe retire early with me!