How to Do a Monthly Budget Review: A Step-by-Step Guide

Hey there, friend! A monthly budget review is crucial for staying on track with your financial goals. It’s like a check-up for your money, helping you track spending, reflect on money goals, and build strong budgeting habits. Today, I’m sharing a simple guide to make your budget review easy and effective. We’ll walk through checking your spending, adjusting categories, and setting new goals. Plus, I’ve got a printable checklist and template for you, and a table to compare your planned vs. actual budget figures. Let’s get started!

Why a Monthly Budget Review Matters

A monthly budget review helps you see where your money went, spot any overspending, and adjust for the next month. It’s a key habit for anyone who wants to stay in control of their finances. Think of it as a monthly reset for your money goals. Ready to dive in?

Step 1: Gather Your Financial Data

First things first, grab all your financial statements and receipts from the past month. This is the foundation of your review. You’ll need:

• Bank statements

• Credit card statements

• Receipts for cash purchases

• Pay stubs or income records

Having everything in one place makes it so much easier to track your spending accurately. I like to keep a folder on my desk just for this, so nothing gets lost.

Step 2: Categorize Your Expenses

Next up, sort your expenses into categories. This step helps you see the big picture of your spending. Some common categories are:

• Housing (rent or mortgage, utilities)

• Food (groceries, dining out)

• Transportation (gas, public transit)

• Entertainment

• Savings

• Debt payments

You can use a budgeting app, a spreadsheet, or even a notebook to organize this. If you’re just starting out, keep it simple with broad categories. As you get the hang of it, you can break them down more.

Step 3: Compare Planned vs. Actual Spending

Now comes the fun part. Compare what you planned to spend with what you actually spent. This is where you really track spending and see how your budgeting habits hold up. Here’s an example table to show you how it works:

In this table, you can see overspending in food and entertainment, but savings in transportation. The differences tell you where things went off plan. Pretty eye-opening, right?

Step 4: Identify Areas for Adjustment

Take a good look at those differences. This step is all about figuring out what happened. Ask yourself:

• Why did I overspend in some categories?

• Were there unexpected expenses?

• Did I set realistic amounts?

Maybe you spent more on food because you ate out too much. Or perhaps that extra $50 on housing was a utility bill spike. If you saved on transportation, that’s awesome! You could move that $20 to savings next month. This is your chance to tweak things.

Step 5: Set New Goals for Next Month

Based on what you learned, set some fresh goals for the next month. This is where you reflect on money goals and make your budget work for you. If entertainment was over budget, maybe cut back to $80. If you’re always under on transportation, lower that planned amount and boost your savings instead.

Also, think about your bigger goals. Are you saving for a trip or paying off a loan? Adjust your categories to keep moving forward. It’s all about progress, not perfection!

Monthly Budget Review Template

Here’s a template to make your monthly budget review a breeze. Just fill it in with your numbers each month:

Download the full template here (link to your template). It’s super flexible, so add any categories that fit your life.

Final Thoughts

Doing a monthly budget review might feel overwhelming at first, but trust me, it gets easier every time. It’s the best way to track spending, reflect on money goals, and strengthen your budgeting habits. Don’t worry if you mess up or overspend sometimes. We all do! The important thing is to learn from it and keep going. You’re taking charge of your money, and that’s something to be proud of. Let me know how it goes, okay? You’ve got this!

Read more:

The Envelope System Budget: How To Save Up to $500 a Month