Toshl Finance Blog

How to Set Up Your Budgets and Control Your Spending (Web App)

Knowing where your money goes is an important step which can help you with reining in your spending, just by knowing your weak points. But sometimes you need to grab the bull by the horns and firmly set the direction in which you want your finances to go. Budgets are here to help you do that.

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 all together. 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.
Click the blue + button on the bottom right to add a budget.
Leave it on All expenses, click Next.
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. This will also enable some nice features later on.
Click Next.
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 you can click Save, but if you’re wishing for some more options, click “Show more” on the bottom.blog_tut_2_5
As you see some new options showed up:
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 deep down that you’ve cheated. ;)
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.
Once you’re satisfied with all the choices. Click “Save”.
Your first monthly budget. Congratulations!

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 right to Add a budget.
This time, click on the dropdown and choose this to be a budget for a category.
You’ll see a pie chart of your all time spending per category to help you decide more easily what to save on. Click on the pie chart or chose the category by name below. We’ll go with Food & Drinks this time. Click next.
Keep it on the 1 month period. Click Next.
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.
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 %, 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.).Capture d'écran 2015-05-25 13.13.08
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.
Posted in Personal finance, Tips & Tricks, Tutorials, Web App Tutorials