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Step 2 – Your Monthly Expenses 

People frequently ask: What should our spending plan look like? How much should we spend for food, clothing, and transportation… and so on? Are we spending too much on housing?

Households are rarely alike – thus a “typical’’ spending plan will not apply to everyone. There can be no hard-and-fast rules for family spending, because individual needs, tastes and economic circumstances vary from family to family – even when they have identical income and the same number of family members. However, there are various sources of cost of living information that can be used as guidelines to compare how your family’s spending differs from the average spending pattern of others.

• Categories: If you have tracked your expenses, you know how much is spent monthly for family living expenses. If not, use records, such as canceled checks, bills, and credit card and other receipts to figure out how much is spent. List the amount for each category on the appropriate lines in Step 2 of the worksheet from Step 1.

– Housing: mortgage or rent payments, property taxes

– Utilities: electricity, gas, oil, phone, water, cable TV, Internet

– Household Operations and Maintenance: repairs, cleaning supplies, paper supplies, equipment, pets and supplies

– Food: groceries, eating out, school lunches, snacks

– Transportation: gas, car repairs, maintenance, parking, bus, taxi fares

– Medical Care: doctor, dentist, clinic, hospital, medicine, glasses

– Credit Payments: car payments, installment loans, credit cards, charge accounts (If you break out the credit payments into the appropriate family living expense category, you will have a more realistic idea of the actual costs for clothing, entertainment and eating out, for example).

– Insurance: health, life, property, car, disability, long-term care

– Clothing and Personal Care: new clothing purchases, laundry, dry cleaning, hair care, cosmetics, toiletries

– Education and Recreation: books, magazines, newspapers, lessons, tuition, hobbies, club dues, sports, entertainment, vacations

– Miscellaneous: child care, gifts, contributions, personal allowances, child support, alcohol, tobacco

– Savings: funds set aside for seasonal and occasional expenses, short-term and long-term goals (college fund, retirement).

Remember, not all expenses are monthly. Because some items, such as property taxes or insurance premiums, come once or twice a year, families often forget about them and do not have the money to pay for them when the bill arrives in the mail. Be sure to include your non-monthly expenses in the spending plan.


Monthly Spending Plan Worksheet
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