The first time I sat down to plan a budget with my wife, we didn’t know where to start. There were literally dozens of expense categories popping into our head at once. The whole process seemed a bit overwhelming.
At some point it dawned on us that we needed some clarity about the process. We needed to narrow the field and focus on certain priorities in the budget. By doing that, it became obvious what areas of the budget we needed to focus on first.
What we found was that there are five fundamental expenditures to focus on when you plan a budget. Without them, any person would have a difficult time surviving. Coincidentally, these categories will also be some of the most expensive budget items each month. Those two reasons alone – basic survival and cost – should justify why it’s important to start with them when you plan a budget each month.
Five Basic Categories When You Plan a Budget