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Personal Budget Spreadsheet by Vertex42

Hi Everyone!

I am very excited to introduce you all to Vertex42 who, in my opinion, are second to none when it comes to building financial tools in Excel. If you can think of it, they have a spreadsheet template for it. The usability of each spreadsheet is perfect for those just starting to manage money to more advanced financial planners. Their statement on the front page, alone, sums it all up:

“We love Microsoft Excel®…Our collection of financial calculators include some of the most powerful and user-friendly debt reduction and money management tools you can find.”

In searching for a budgeting spreadsheet that aligns with how I think about money (i.e. centered around savings), I came across Vertex42’s Personal Budget Template.

The spreadsheet is your standard Income minus Expense calculator, but what puts this above any other that I have come across are the following:

#1 Highlight: Savings Expense Category
Savings Expense??? Huh?

You are not confused. You read it correctly, the spreadsheet includes savings as an expense category that reduces your monthly net income or the cash you have left over after expenses are paid.

It’s that old ‘pay yourself first’ saying. By training my brain to think of saving similar to paying rent, for example, it eventually became automatic and left no room for excuses. How often have you told yourself this month is going to be different, you were going to buckle down and start saving? For the first two months you are mindful of your spending and manage to put a little aside into your savings account. Then, without fail, the extra bottle of wine at dinner or the latest smartphone is released out and you are back to your old habits again. By making savings a monthly expense, spending your leftover cash becomes guilt-free.

#2 Highlight: Comprehensive Listing of Expenses
Don’t be intimidated of all the expenses listed, they are provided to ensure you have a complete understanding of where each and every penny goes. And because it has the ability to reconcile to your bank statement, you can’t neglect those small dollars that tend to add up leaving you confused about where all your money went.

Hint: If you use this tool to help you figure out where all the money is going, don’t focus on the expenses such as mortgage/rent, car payment, or other fixed monthly costs that shouldn’t be changing.  Focus on those fluctuating (variable) expenses that you are in control of – entertainment, dining out and other non-routine expenses.

Personal Additions
I’ve tailored my spreadsheet to include two very important calculations – saving percentages and budget-to-actual figures.

Savings Percentages.  I like to see certain financial metrics/ratios as indicators of my progress, so I added formulas to calculate the percentage of my savings to income by month as well as year-to-date (YTD).  By calculating these percentages, I can set goals for myself each month or find ways to reduce variable expenses in order to increase the savings %.

Savings % of Total Income = Total Monthly Savings divided by Total Monthly Income

Savings % YTD = Total YTD Savings divided by Total YTD Income

Budget-to-Actual.  I find it easier to identify spending issues when numbers pop out at me. In order to do this, I added two additional tabs in the file so that I would have a ‘Budget’ tab where all my estimated or target numbers are set, an ‘Actual’ tab for the true cash inflows and outflows, and an ‘(Over)/Under’ tab that simply calculates Budget minus Actual.

It’s usually in this tab where I see how out of hand those variable expenses have gotten. Although the fixed expenses (car payment, mortgage/rent, etc) should have little to no difference between Budget and Actual, the ‘(Over)/Under’ tab is useful to identify errors in a bill or when a promotion ends and your cable bill suddenly skyrockets, for example.

Download your FREE Personal Budget here.


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