Consider what your goals are. Is the situation dire and you need to seriously reduce your spending to the minimum? Or would you just like some more money left over to start some savings? Want a friendly reminder in case the spending goes over your usual average? This consideration will determine your basic budgeting strategy.
1. Set a monthly budget for all expenses
Take a look at how much you usually spend each month altogether. Based on what your goals are, pick a number that will be your monthly spending goal. If you’re with the easygoing, “just monitoring” crowd, you can keep it much the same as it was in the previous months. If you want to spend much less than before, reduce the number accordingly.
Now let’s get to the practical part.
Go to the Budgets section. Tap the navigation icon on the top left or simply swipe from the left edge of the screen.
Tap the blue + button on the bottom left to add a budget.
Leave the “budget for” on All expenses. Tap the “Time period” section below.
Leave the setting to the budget period of 1 month. You can add other types of budgets later on, we recommend starting with a monthly budget which will be in sync with your financial month. Monthly budgets for all expenses also play nice with other features. They get included in the River flow graph, as well as get a more prominent place in the Budgets section.
If you want, you can also make the budget start further in the past using the “Budget starts on” setting. This is useful if you have data in Toshl from earlier periods.
Tap the row labeled “Amount”.
Remember that monthly spending goal number you chose before? This would be the time to enter it. Once you click in the amount field you also get some additional options:
– “number” enter the amount as a regular number which stays the same every month until you change it
– “income –“ this will sum up all the incomes in the current financial month and subtract a number of your choosing. If you stick to your budget, this will be the amount of money you save each month.
– “income +” your budget will be your income plus the number you chose. Probably not ideal for most, but if you can draw on a reserve of cash to add to your monthly income, this is the solution for you.
– “% of income” great to set a proportion of income you want to save. If you want to save 20 % of your income each month, set the budget to 80 % of your income and stick to it.
Whether you want the number to be static or adjust automatically to your income, your call. You know your circumstances best. If things change, or you manage to save more you can always change it later.
The next step is simply a sum up of what you chose so far. If you’re satisfied with the choices, tap the tick icon on the top right of the screen to Save the budget.
Your first monthly budget. Congratulations!
While we covered the basic things you need to set up your budgets in previous steps, there are a few more options that you can use once you nudge closer toward becoming a budgeting savant:
Accounts – You can limit the budget to follow only certain accounts. That way only expenses coming from those accounts will be counted in the budget. For the start, it’s probably better to leave it to “All accounts”
Date – This defines when a specific budget starts. If you left the budget on the monthly period, the default will be the start of the current month. If you have already been using Toshl for a longer period of time, you can set that start date in the past and budgets will be calculated automatically for all those past periods. Neat trick, eh?
Move remaining funds to next period – Also known as “the rollover”. If you set this to ON, any surplus or lack of funds in the budget will be transferred to the next budget period. If you really want to be rigorous about your spending, use this and see how good you are at self-discipline. If the sins of the past months become too much of a burden, you can edit the rollover amount separately later on. But you’ll know you’ve cheated on the inside. ;)
Title – We automatically generate a title for your budgets based on the settings you chose for each one, but you can always change it to something custom if you so desire.
2. Add a monthly budget for specific categories
Not all spending is the same. Some costs are relatively fixed or a bit harder to change, like rent for example, while others are more flexible and more easily change month to month based on your habits.
Think about what kind of spending gets you in trouble. Which are the unnecessary things you really could do without, or at least spend a bit less on them. All the tech gadgets, drinks, games, gardening supplies… ? Your call. Just don’t say “alimony”. Not cool! ;)
If you’ve been using Toshl for a while, it’s best to browse through your past months in expense graphs and see where your money leaks are.
Once you’ve thought about it, go to the Budgets section again, click the blue + button on the bottom left to Add a budget.
This time, in the “Budget for” section choose this to be a budget for a category.
You’ll see your categories listed so you can choose which category or categories you wish to track with this budget. We’ll go with Food & Drinks this time.
Next, let’s scroll down and tap the Amount setting below.
How much you can spend on this specific category is up to you. If you have past data base it on that, see how much you spent and what your goal is. If you prefer, you can also define it as a percentage of your income, but that will probably take a bit more fine-tuning in this case.
If you’re satisfied with your choices, that’s all there is to it. Click “Save”.
If you’ve used some more advanced features like starting the budget in the past or for certain accounts before, you can set these to match with this budget as well.
3. Budgets for more categories?
If you’ve identified multiple categories that you need to keep a vigilant eye over, by all means, add them as well. If you want, you can make a budget for every single category, the same way we have been doing this so far in this tutorial.
Monthly budgets for categories and the one for all expenses are a bit different than the rest of the budgets. Because they all use the same monthly period and the categories add up to 100 % of the expenses sum, this is reflected in the budget list.
The top budget is your general monthly budget for all expenses. The ones below each represent a percentage of the total monthly budget. That’s why the little progress bars beneath each category budget are of different lengths. The category budget amounts all represent a percentage of the total monthly budget. The categories for which you have not yet made a budget for are covered in the “Remaining budgets” section. That way you get a rough picture of how your monthly budget for all expenses is distributed among the categories.
4. What about other, non-monthly budgets?
In this tutorial, we covered the most basic budget that we think would be most beneficial for most people to set up at first. We also offer a lot of different budget options for your specific needs. You don’t need to base your budget based on your financial month, although they’re displayed a bit more nicely if you do (see point 3.).
Budgets can be based on almost any time period, be it a custom number of days, weeks, months, even years.
They can be set to track all expenses, some categories, exclude some categories, tags or exclude some tags. They can also track your budget using all financial accounts, or just a few you selected.
You can have the budgets transfer the remaining or lacking funds to the next period (rollover) or see them individually for each period.
Explore Toshl, try the different options and we’re sure you’ll find a way to budget which suits your needs the best.