Budget planning is probably the key element in personal money management strategies. Creating and monitoring household budgets motivates you to try living within your means and avoid overspending. A budget set for a spending category has the effect of a virtual stopper, suppressing your spontaneous desires and keeping your momentary cravings under control. A well-laid family budget will not only help you distribute and spend your money more wisely, but also contribute to the achievement of your financial goals. See how InEx Finance Budget tool can help you plan, manage or track monthly spending and revenues.


Example:


You want to create a Budget for the Category “Entertainment” to see how much money you spend monthly on your hobbies and other recreational activities. Before setting the new Budget, you may want to analyze your spending habits within this Category for the last couple of months in order to have a clear idea of your average monthly expenses for “Entertainment”. Let's say that you spend around $235 a month. If you intend to budget the Category “Entertainment” for a longer period of time, then you should first apply some changes to the Category itself before proceeding to new Budget creation. These are the steps to follow:

  1. Access Categories tool from Other drop-down list in the top menu and click on “Entertainment” in the Categories list.
  2. Select “Category Budget” in the “Automatic budget generation” field (you can read more about this feature here).
  3. Click on "Budget template per Month" section and select “Yes” in the Rollover field if you want any Expense balance for selected Category to be rolled over from one month to the next (see this page for more information).
  4. Leave “Yes” in the “Expense limit exceeded notification” field if you want to be notified when you go over your Budget (see this page for more information).
  5. Click on "+" button to enter the Expense amount and select the corresponding Currency (for instance, “235” and “USD”, respectively).
  6. When done, click on Update button to save your changes.

Now you can proceed to adding a new personal Budget in your InEx Finance account using the following steps:

  1. Access Budgets tool from Other drop-down list in the top menu and click on Add Budget button in the upper left-hand corner.
  2. Select the start Year and Month for your new Budget from the corresponding lists (for instance, “2011” and “November”).
  3. Select the budgeted Category which the system will begin tracking income and expenses for (for instance, “Entertainment”).
  4. Optionally, write some notes in the Comment box.
  5. When done, click on Create button to add your new Budget “Entertainment”.

For December 2011 you project going to great expenses due to the winter holidays season. You want to buy a lot of Christmas presents for friends and relatives, and plan to visit your parents as well. This implies additional spending in some other Categories. And since your monthly revenues haven't changed, you'll have to cut back on expenses in less important budgeted Categories, “Entertainment” being one of them. After the system has automatically generated your Budget “Entertainment” for December 2011, here is how you can apply your changes:

  1. Access Budgets tool from Other drop-down list in the top menu.
  2. Click on Edit icon corresponding to the Budget “Entertainment” for December 2011.
  3. On the Edit Budget page, change the Expense amount (for instance, “110” or “235-125”).
  4. When done, click on Update button to save your changes.

Please note that only the Budget “Entertainment” for December 2011 will be affected by your changes. On the 1st of January 2012, when the system generates the monthly Budget for the Category “Entertainment”, the Expense amount will be $235 again (according to the “Budget template per Month” for this Category).


Let's assume that in June 2012 you get a promotion along with a salary increase. You have more money pouring into your household budget and you can afford to spend more on the things you enjoy doing. You decide to revise the budget allocations for different Categories, “Entertainment” included. So instead of $235 you allow yourself to spend $400 a month to sustain your hobbies and other activities that interest you. Here is how you can increase the monthly Expense amount for Budget “Entertainment” from June 2012 onward:

  1. Access Categories tool from Other drop-down list in the top menu.
  2. Click on “Entertainment” in the listed Categories.
  3. On the Edit Category page, change the Expense amount (for instance, “400” or “235+165”).
  4. When done, click on Update button to save your changes.

Please note that all monthly Budgets “Entertainment” automatically generated after the date of your changes will have a set Expense amount of $400. You can follow the above steps if you want to update any other information related to your Budget “Entertainment” (for example, to disable “Rollover” or “Expense limit exceeded notification” features).


Each time when you add a Transaction in the budgeted Category “Entertainment”, the system will aggregate the input data into insightful reports and overviews. It is vitally important that you regularly track and analyze your budget performance. Our online budget tracker helps you take control over your spending and stick to your monthly budgets. InEx Finance provides efficient and easy-to-use tools for tracking your household Budget “Entertainment”:

  1. Overview page – the Expense table outlines consolidated information pertaining to your Budget “Entertainment”, such as: budgeted amount ($235), actual spending (e.g., $112) and Budget fulfillment (a small graphical representation corresponding to your current Budget status followed by a percentage ratio – 48%).
  2. Budgets Report (in Table Reports) – you can track your Budgets by years or months and view results in various report currencies. This report shows all your budgeted Categories (“Entertainment” included) in any given month, along with budget allocations and fulfillment ratios.
  3. Budget by Category (in Table Report) – select “Entertainment” in the Category field and click on Filter button to view month-by-month Budget allocations and performance for the selected Category. You can easily pinpoint the months when you have closely followed your budget plans by looking at the percentage ratios.
  4. Budget Transactions (in Table Reports) – select “Entertainment” in the Category field, choose the month for the Budget you want to analyze and click on Filter button to view all the Transactions you have recorded into your InEx account during the selected month for Budget “Entertainment”. This report reflects how your monthly spending decisions affect your household budget execution.

Updated at August 06, 2012 10:17