{"id":24706,"date":"2026-04-29T07:28:21","date_gmt":"2026-04-29T07:28:21","guid":{"rendered":"https:\/\/incredipros.com\/?p=24706"},"modified":"2026-04-29T07:28:21","modified_gmt":"2026-04-29T07:28:21","slug":"baby-step-1-your-budgeting-guide","status":"publish","type":"post","link":"https:\/\/incredipros.com\/?p=24706","title":{"rendered":"Baby Step 1: Your Budgeting Guide"},"content":{"rendered":"
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New to budgeting and on Baby Step 1? We\u2019re so glad you\u2019re here! This guide will help you start your first monthly budget.\n <\/p>\n

Right now, you\u2019re trading the short-term rush of immediate gratification for the peace of financial success over the long term. And that\u2019s hard work. So, keep in mind that budgeting on Baby Step 1 means squeezing every last penny out of each budget category\u2014clipping coupons, eating rice and beans, and selling so much stuff the kids think they\u2019re next!\u00a0\n <\/p>\n

I know you can do this. Your future self will be so thankful you did!\n <\/p>\n

The Best Way to Budget<\/h2>\n

Before you actually start budgeting, let\u2019s talk about what we\u2019re aiming for: a zero-based budget.\n <\/p>\n

A zero-based budget doesn\u2019t mean you have zero dollars in your bank account\u2014it means you\u2019ve subtracted all your monthly expenses from your monthly income until the amount left is zero. You\u2019ve given every dollar a job to do!\n <\/p>\n

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Get expert money advice to reach your money goals faster!<\/p>\n<\/p><\/div>\n

Your zero-based budget is your plan<\/em> for the month. It\u2019s not just a way to track spending your money on whatever you want. So, if you keep going way over or you\u2019re not making progress on your money goals, you really need to buckle down and stick to what you decided you could afford before the month began.\n <\/p>\n

You can create a zero-based budget the old-fashioned way with a sheet of paper, or you can use our super easy and free budgeting app,\u00a0EveryDollar.\n <\/p>\n

Let\u2019s Find Your Money<\/h2>\n

When it\u2019s time to start your budget (we\u2019ll get there in the next section), these are the numbers you\u2019ll need:\n <\/p>\n

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1. Your Monthly Income<\/h3>\n

Add up all the money you bring in and put this total at the top of your budget. This includes paychecks, side hustles, residual income, child support and any other cash you expect to bring in. If it\u2019s money that comes into your household\u2019s bank account, it\u2019s income!\n <\/p>\n

2. Your Monthly Expenses<\/h3>\n

You need to include every expense you\u2019ll have for the month. Most expenses will fit into the categories I recommend in this guide, but feel free to come up with your own too!\n <\/p>\n

The best thing to do is to look at your last couple of bank statements and make sure you\u2019ve included everything.\u00a0\n <\/p>\n

3. Your Seasonal Expenses<\/h3>\n

Pull out your calendar as you work through this part. What expenses do you have coming up that you can start planning for now? Christmas is in December every year, so it doesn\u2019t exactly sneak up on you. Birthdays, anniversaries and car tag renewals shouldn\u2019t surprise your budget either.\n <\/p>\n

For example, if you\u2019re going to spend, say, $500 on Christmas, you\u2019ll need to start budgeting about $40 per month in January. If you start saving in June, that number jumps to about $70 per month.\n <\/p>\n

4. Your Cushion<\/h3>\n

You\u2019re aiming for zero dollars left in your budget, but it would make anyone nervous to have zero dollars in their bank account<\/em> at the end of the month. Most people leave an extra cushion\u2014anywhere from $100\u2013300\u2014in their checking account that isn\u2019t counted in their income. When you start this process, budget for that cushion and then try to forget it\u2019s there.\n <\/p>\n

So, your first month would have a line under the Saving category labeled Cushion. You only budget for it once, and every month after, it just provides a small, invisible buffer in your checking account.\n <\/p>\n

Budgeting Isn\u2019t One-Size-Fits-All<\/h2>\n

Now that you know the numbers you need to create a zero-based budget, let\u2019s apply what you\u2019ve learned to your unique situation.\n <\/p>\n

The median household income in America is $61,937.1<\/sup> And just like that number doesn\u2019t tell everyone\u2019s story, there\u2019s no one-size-fits-all budget either. This guide is based on averages. Everyone\u2019s budget will look a little bit different based on a number of factors\u2014like where you live, if you have kids, how far you commute to work and more.\n <\/p>\n

Don\u2019t feel bad if you need to adjust your numbers frequently as you get started. It takes people about three months to get the hang of budgeting. So, give yourself some grace and stick with it! Before you know it, you\u2019ll be in control of your money, telling every dollar where to go, and well on your way to a $1,000 emergency fund!\n <\/p>\n

It\u2019s time to get out your numbers and start your own monthly budget! Ready? Let\u2019s do this!\n <\/p>\n

The Budget Guide<\/h2>\n

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Income<\/h3>\n

Will Vary<\/em>\n <\/p>\n

Your income should include paychecks, small-business income, side hustles, child support and any other cash you bring in. If it\u2019s money and comes into your household\u2019s bank account, it\u2019s income!\n <\/p>\n

Put the total at the top of your budget. There you go\u2014that\u2019s all the money you have to work with this month. Then it\u2019s time for my favorite part: Let\u2019s tell every dollar where to go!\n <\/p>\n

Giving<\/h3>\n

10%<\/em>\n <\/p>\n

When you\u2019re saving up for that $1,000 emergency fund, every dollar counts. So, you may be wondering why I want you to give 10% of your income during this stage. I mean, what\u2019s the point in working your butt off to save money if you\u2019re just going to turn around and give it away?\n <\/p>\n

Hear me out on this: In all my years of living and breathing personal finance, I know that people don\u2019t experience true financial peace until they become generous givers. Why is that? Because giving changes you.<\/em>\n <\/p>\n

The reason I teach people to start giving immediately, even when they\u2019re in Baby Step 1, is because financial health isn\u2019t just about the math\u2014it\u2019s about your heart too.\n <\/p>\n

Giving is the mechanism that moves you from selfish to selfless.<\/em>\n <\/p>\n

Even if you don\u2019t have a lot to give right now, you\u2019re setting yourself up to give more in the future.\u00a0Establishing this habit will not only impact the lives of others, but it will also change your heart.\n <\/p>\n

But most people forget to make giving a priority in their budget. If you wait until the end of the month to give from whatever\u2019s left, you probably won\u2019t have much to give. That\u2019s why you should prioritize giving above everything else, no matter what Baby Step you\u2019re on.\n <\/p>\n

Give it a try. When you make your budget, assign 10% of your income to giving. As a believer, I give this money to my local church. Where you give is totally up to you and your family\u2014just make sure your giving follows your personal values.\n <\/p>\n

Giving is the most fun you\u2019ll ever have with money.\u00a0It\u2019s addictive\u2014in the best way possible. So, go out and give a little until you can give a lot. I promise you that it will be worth it.\n <\/p>\n

Spending<\/h3>\n

The Four Walls<\/em>\n <\/p>\n

Your family comes first. Make sure your priorities are in order and start by taking care of your <\/em>necessities first. Don\u2019t get behind on your utility bills just to stay current on your Mastercard or student loan payments.\n <\/p>\n

If you’re going to be behind on something\u2014and I’m not recommending being behind\u2014choose to pause paying, or pay less, on your unsecured debt.\n <\/p>\n

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Credit cards and student loans are examples of unsecured debt\u2014that means the lender can\u2019t take anything away from you (like a car or a house). Unsecured debt is typically going to be the last debt you pay if you\u2019re in trouble. The first debt you pay should be something they can take, so make sure you focus on the Four Walls first:\n <\/p>\n

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  1. Food<\/li>\n
  2. Utilities<\/li>\n
  3. Shelter<\/li>\n
  4. Transportation<\/li>\n<\/ol>\n

    1. Food<\/strong>\n <\/p>\n

    Will vary: The average American family of four spends between $568\u20131,296 a month.2<\/sup><\/em>\n <\/p>\n

    This number only includes groceries and meals prepared at home, and it\u2019s an average. But you don\u2019t want to be average! <\/strong>Try to spend even less so you can put extra money in your starter emergency fund.\n <\/p>\n

    Eating out at restaurants goes in another category you\u2019ll see later (the Personal Spending\/Recreation category) while you\u2019re on Baby Step 1, because on this Baby Step, you shouldn\u2019t see the inside of a restaurant unless you\u2019re working in it!\n <\/p>\n

    6 Ways to Lower Your Grocery Bill<\/strong><\/em>\n <\/p>\n