University of Idaho Extension


Budgeting graphic


To begin building a budget, you must know how much disposable income you have to work with.

We all do. You’ve probably heard someone say, “Me? Budget? I don’t have enough money to budget!” Or, “It’s too complicated,” or, “It’s too confining.” But the process of budgeting isn’t just for the wealthy, and it doesn’t have to be complicated.

In reality, budgets help everyone: those with small as well as larger incomes and those who sometimes overspend as well as those who are cautious with their money. Rather than confining us, budgets put us in control: they help us pay our bills on time, set aside savings for emergencies, keep our spending in line with our income, and achieve our short- and long-term goals

For a successful budget: keep it simple, make it personal, keep it flexible, and keep a positive attitude.


To begin building a budget, you must know how much disposable income you have to work with. (Disposable income is what you have to spend after taxes, insurance premiums, and other employment-related costs have been withheld from your paycheck.)

For a month, identify all of your money sources and record their amounts. Whether you get paid weekly, every two weeks, or monthly, total the amounts for a monthly figure and enter them on a budget worksheet.

While income sources will vary from person to person, the following list will get you started:         

  • Wages/Salary
  • Tips/Commissions
  • Child Support/Alimony
  • Public Assistance/TANF
  • Social Security/Pensions
  • Unemployment/Disability
  • Veteran’s Benefits
  • Interest/Dividends


To continue building your budget, you’ll need to identify and list your expenses. If you’ve  tracked expenses for at least a month, this task will be easier.

Fixed Expenses

Fixed expenses are regular, set amounts that you spend each month. The amounts do not change during the year. You have committed to pay them on a regular schedule, and they cannot be easily changed. Some common fixed expenses are:

  • Housing (rent, mortgage, association fees)
  • Insurance (health, life, property, vehicle)
  • Savings
  • Vehicle payments
  • Cable/Internet
  • Other loan payments

Variable Expenses

The next dollar amounts to consider when building a budget are your variable expenses. These change depending on the time of year, usage, and circumstances. You decide how much to spend on them and when to spend it. Although variable expenses are important and not frivolous, you can cut back on them—or even eliminate some of them from your budget entirely—when money is tight. Some common variable expenses are:

  • Food
  • Clothing
  • Transportation (gas, oil, maintenance, parking, bus, rail, taxi)
  • Utilities (electricity, garbage removal, gas, oil, water, sewer)
  • Land line/cell phone
  • Household (maintenance, furnishings, garden/cleaning supplies)
  • Health and medical
  • Child and elder care
  • Personal expenses (haircuts, cosmetics, laundry, dry cleaning)
  • Education
  • Recreation and entertainment
  • Other (allowances, church, gifts)

If you have a steady income, consider signing up for level pay for some of your variable expenses. For example, your heating costs vary depending on the time of the year. Using level pay allows you to pay the same amount every month of the year. It makes your summer bills higher, but it keeps your peak winter bills from breaking your budget.

Periodic Expenses

Finally, consider your periodic expenses when building a budget. Not everyone has them, but if you do, include them in your budget under variable expenses. Examples:

  • Tuition
  • Back-to-school or summer camp health check-ups and related expenses
  • Servicing of household equipment/systems (sprinklers, heating/cooling, septic tanks) and recreational vehicles
  • Pets and other animals (veterinary bills, boarding, licensing)
  • Holiday expenses


To assist you in setting up a budget, we provide you with two interactive worksheets, which you can print or download to your computer:

Be sure to include all of your income and expenses. If a worksheet doesn’t include a category you need, personalize and adjust it to fit your circumstances.

Living on an irregular income

People who earn income that varies throughout the year need additional management skills. Planning ahead, prioritizing expenses, and living within income earned is critical. The Living on an Irregular Income /en español publication from Colorado State University can be helpful.

Developed by:

Linda S. Gossett
University of Idaho Extension Educator-EFNEP
State EFNEP Coordinator
5880 Glenwood Ave.
Boise, ID 83714
(208) 376-1036

Marilyn C. Bischoff
University of Idaho Extension Professor and Family Economics Specialist
322 E. Front St., Ste. 180
Boise, ID 83702
(208) 364-9910

2014 Update by:

Nancy M. Porter, Ph.D.
Extension Personal and Family Finance Consultant
University of Idaho
(864) 650-8289

Other credits:

Educational Communications,
University of Idaho College of Agricultural and Life Sciences:
Editing: Marlene Fritz, Communications Specialist, Boise
Web Design: Jacob Peterson, Web Designer, Moscow

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