How to Create a Household Budget WITHOUT a Fight

Being on the same page financially with your spouse is truly benefical. There is ways to create a housebold budget without getting upset with each other.With the end of the year quickly approaching, there is no better time to start talking about a household budget. I don’t know about you, but we are always trying to do better with our finances. We have found that creating a budget, and talking about it regularly, has really helped us in our financial journey.

But, that doesn’t mean we see eye to eye on everything in our budget. So, how can you create a household budget as second nature and without causing a fight?

Determine Your Why

The main reason you want to create a budget is extremely important. Sometimes you and your spouse may not be on the same page regarding finances, but discussing your main reason WHY can really help get you more aligned. After all, there is not point in creating a budget, and potential stress, if you don’t have a strong reason to.

Here are some of the most common reasons why people decide to create a budget:

  • Paying off debt
  • Building an emergency fund
  • Building towards retirement
  • Funding travel
  • Paying for home improvements
  • Saving to purchase a house

Even if your WHY doesn’t fit into one of these categories, the important factor is that you have one. You and your partner’s WHY will become your driving force to not only create a budget, but stick to it.

Creating the Vision

The next step, after determining your WHY, is to discuss it with your partner. Ask what their WHY is. Even if it isn’t the same as yours, respect their opinion and ask them about their WHY. As with any part of a relationship, communication and respect are integral to success. Creating a budget is no different.

Once you have determined both of your WHY‘s, then you will need to discuss the best action plan to get to your goals.

Some good questions to ask are:

  • What is the proposed timeline for both of your goals?
  • How much should you be saving?
  • How much do you think you can feasibly save a month?
  • Where are areas that you feel you both can cut back on?
  • What areas does your partner think you can both cut back on?

These questions are great jumping off points to create your budget because they are setting the foundation.

Budget Categories

After discussing the questions proposed above, then it is time to work on setting up the budget categories. Categories really help you see, on a monthly basis, what you are ACTUALLY spending on things, as opposed to what you THINK you are spending. Most of the time, what we think we are spending on things ends up being completely different than what we are actually spending. Therefore, this is a very important piece to any budget.

Some great categories to start with are:

  • Income from any and ALL sources
  • Recurring Expenses housing, insurance (health, homeowner’s/renter’s, life), utilities, cell phone, etc.
  • Automobiles/Transportation car payments, car insurance, gas, maintenance, bus, subway, taxi, Uber, Lyft, etc.
  • Food/Drinks – all groceries, including alcohol (unless you decide to break this out into a separate category)
  • Household – all toiletries, home repairs and renovations, yard maintenance, pool maintenance, etc.
  • Travel – airfare, lodging, food/drinks while traveling, transportation while traveling, souvenirs, etc.
  • Clothing – all clothes, shoes, and accessories (belts, hats, scarves, mittens, sunglasses, etc.)
  • Gifts – birthdays, housewarming, holidays, graduation, etc.
  • Luxury – eating out, entertainment, jewelry, etc.
  • Savings – savings accounts, retirement accounts, investment accounts, etc
  • Misc – anything that is random and doesn’t fit into the other categories (such as stamps or haircuts)

These are just some of the basic categories that we use. However, if you want to break them down further to really dig into what you are spending on a microscopic level, then go for it!

Budgetary Compromise

After you set up your budget categories, then you have to determine how much of your income should go to which category. This can actually be the most difficult part of the whole process and can create the most angst among couples. So going into it with an open mind and patience is really key to making your household budget a success.

The first year you do this can be the most difficult because you don’t have as much raw data to pull from, so part of it is a guessing game. The easiest categories to determine are usually:

  • Income (unless one of you is self-employedย like myself because then it fluctuates every month)
  • Recurring Expenses
  • Automobiles/Transportation

Once you have these figured out, then you will need to take what is left and divvy it up among the remaining categories. This can be much easier said than done though!

You and your partner should discuss how each of you thinks the remaining dollars should be appropriated, and that is where disagreements can come into play.

Budget Example:

Here is an example of how we have our budget structured, just to give you some raw numbers to play with:

  • Income – $5,600.00
  • Recurring Expenses – $1,100.00
  • Automobiles/Transportation – $1,600.00
  • Food/Drinks – $800.00
  • Household – $400.00
  • Travel – $167.00
  • Clothing – $75.00
  • Gifts – $75.00
  • Luxury – $400.00
  • Savings – $933.00
  • Misc – $50.00

Keep in mind that this is how it is supposed to look every month, but that doesn’t mean that it actually works out that way. We are still trying to pay off one car and our mortgage, so some months we pay more in those two categories, which means we end up saving less.

Budget Breakthrough

Even though my partner and I may not be on the same page with everything all the time (and who is, really?), we both respect each other’s point of view. We also both want to be financially independent by the time our youngest leaves the house, so we have a major goal.

Therefore, we talk regularly about our budget and tweak things accordingly when we feel like we are off track, or if one of us voices a concern. Sometimes, we decide that we want to pivot and reallocate our funds to one category more than another, and that works for us because we communicate well with each other. And we are always careful to be respectful of each other’s opinions about where we would like to see the budget going.

We talk regularly about our budget and tweak things accordingly when we feel like we are off track Share on X

If you can keep these points in mind when creating your household budget, then you are well on your way to success.

What tools have you used to create a household budget without causing a fight? Have they been successful or did you have to change tactics along the way?