Whether navigating your first paycheck or adjusting to the expenses of living with a partner, budgeting is key to financial security. This guide will walk you through the basics of creating a budget you can stick to, even if juggling loans, rent, and a social life.
Growing up in a lower-income household, I learned early on how to stretch every Rand and get creative with finances. But as I started making my own money, I quickly realized that budgeting wasn’t just about getting by—it was about finding a way to meet my goals and feel secure.
It took some trial and error to discover the right approach that worked for me. I tried strict budgets that felt too restrictive, only to swing back to overly relaxed spending that didn’t build savings. Eventually, through small adjustments and figuring out what was realistic for my lifestyle, I developed a budget that made sense for my household’s needs and allowed a little breathing room.
Each experiment taught me something valuable about my relationship with money, showing me how budgeting could be flexible yet effective. Now, I’m excited to share those lessons so that you, too, can find a budget that brings both structure and freedom to your financial life.
So, if it’s your new year’s goal to be smarter with money, this is the perfect read.
Why Budgeting is Essential for Financial Freedom
Everyone’s lifestyle is different, from parents of young kids who work on a strict budget, to DINKs who have a little more freedom with their money. And South Africans have found many ways to budget their money to support their lifestyles.
But how much do we learn about budgeting before we have to put it into practice? If you did have parents who helped you with this, that’s great, but for everyone else, I hope I can make it just a little easier and less daunting.
Here’s how budgeting can work for you:
- When you budget, you decide how much goes to essentials, savings, and lifestyle spending, ensuring there’s no scramble at the end of the month.
- A budget helps you plan for upcoming expenses so that you won’t need to rely on credit cards or loans.
- Budgeting includes setting aside money for emergencies, travel, or big purchases, so unexpected expenses don’t derail your plans.
An Example of Budgeting for Single and Double Income Households
For anyone who has ever sat down to budget their money but had no idea where to start, here’s how I got started.
Step 1: Set Up Your Budget Template
A budgeting template makes the whole process easier. You can adjust it as your needs or income changes, but you should have a solid foundational budget to work from before you can expect it to work.
Here’s how to start:
- Download our Budget Template. Open it in Excel, Google Sheets, or your preferred tool, and customize it with your details.
- Include primary income like your salary or wages and any side hustle earnings. For those with fluctuating incomes, calculate an average monthly amount from recent months.
- Set up categories such as housing, groceries, insurance, and transportation. Grouping expenses will help you see where most of your money goes and where you could cut back.
Use my template
Here’s a step-by-step guide for using your budget spreadsheet to make it as effective and customized as possible:
Make a Copy of the Sheet:
Open the Google Sheet link, go to File > Make a Copy. This will create your own version that you can edit freely.
Add Your Income Streams:
In the income section, enter all sources of income you expect for the month (like salary, freelance work, side hustle earnings). Adjust or add rows if you have multiple income sources.
I would do this part at the end of every month, for the following month (or payment period), so that you can adjust your income if you have a commission or online side hustle money to account for.
Adjust Each Expense to Fit Your Needs:
Review each expense category in the list and change it to match your expenses. If you have unique expenses not listed, add a row for them.
To remove an expense row, simply delete it. If you add or remove any rows, be sure to update the formula in the “Remaining” column (see step 5).
Duplicate the ‘January’ Tab for Future Months:
Right-click the ‘January’ tab at the bottom and select Duplicate. Rename the new tab to the current month, such as ‘February.’
Each month, adjust income or expenses as needed based on any changes.
Adjust the “Remaining” Column if Adding or Removing Rows:
If you add or remove rows in the expense section, drag the formula in the Remaining column down to include new rows. This keeps your calculations accurate.
Track Monthly and Weekly Shopping Lists:
At the end of the spreadsheet, you’ll find both a Monthly Shopping List and Weekly Shopping List. Enter expected prices for your essentials and compare them to actual prices each week.
This will help you:
- Spot any savings when prices are lower than expected
- Adjust your grocery budget if prices increase on any regular items
With this sheet, you can monitor your spending, find areas to save, and adjust as needed to stay on top of your budget each month. Happy budgeting!
Step 2: Calculate Your Total Monthly Income
For couples, combining incomes can make household budgeting easier by giving a full picture of your spending power. Use your monthly income after tax, as this is the amount you’ll have to work with.
- Example for Couples: If you earn R25,000 and your partner earns R20,000, your total monthly income is R45,000 (minus tax).
- Example for Singles: If your take-home pay is R20,000, this is your working budget (minus tax).
- Example for multiple income streams: If you’re single, but make R20,000 at your 9-5 and R5000 babysitting every weekend, plus R1500 dog walking on a Sunday, your total income would be R26,500 (minus tax). And if you’re a couple who brings in R45,000 together from your 9-5s, but you have a craft business bringing in R3000 p/m and your partner does deliveries every weekend for R2000 p/m then you’d have R50,000 (minus tax) to work with.
Step 3: Divide Expenses into Categories
Dividing your expenses lets you understand where your money is going and highlights areas for potential savings. The template sheet offers some basic categories, but if you want to change them, you can right-click on the column and change them in the ‘data validation’ option.
- Debt: anything and everything you need to pay off. This includes monthly loan repayments, clothing accounts, etc. If you’re paying your car off, you could put that here, or in the ‘necessities’ category. The goal is for this category to eventually decrease, but if you do find yourself needing to create more debt, add the monthly repayment amount here immediately.
- Necessities: expenses you can’t cut out of the budget even if you’re having a bad month. Things like groceries, petrol, cell phone accounts, etc. (You can add rent/bond here or in the next category). If you have kids, this would also be school fees.
- Home: In this category, I add rent, electricity (prepaid), wi-fi costs, etc. Anything for the home that is a monthly, fixed cost. For garden and home cleaning services, this category works as well.
- Health: as the name suggests, this is for anything healthwise. Add your gym membership, medical aid, etc.
- Business: would be more specifically for those of us hustling on the side and paying for tools or resources to do this. For example, I add our Microsoft costs (since I don’t pay for that for fun) and the cost of running our blogs and websites. If you work from home, you could put those expenses here as well.
- Entertainment: includes all of our fun costs, Netflix, Showmax, etc. We don’t budget for nights out, since that comes after everything else is paid for—and we’re very much inside humans.
Depending on your needs and lifestyle, you might want to divide your expenses differently – maybe having “debit orders” and “transport” separately, or adding a ‘treat’ category every month.
Note: At the bottom of the Monthly tab, I’ve added “Once off” costs. This could be buying a new inverter to survive loadshedding (let’s hope not, but preparation is best), or a birthday/wedding gift you need to buy that month. These are important expenses, but not recurring.
(Try to) Stick to the “50/30/20 Rule”
Budgeting pros recommend keeping your spending within the following limits:
- 50% for needs: Housing, utilities, groceries, medical, and insurance.
- 30% for wants: Entertainment, dining out, travel.
- 20% for savings: Emergency funds, debt repayments, retirement.
I won’t preach on this, because very rarely do I get this right. But with the budget template, you are able to see the percentage of your expenses according to the categories, which can help you work towards this.
Tip: Old mutual has a pretty cool budgeting calculator you can use to help you if you’re aiming to get to this point.
Step 4: Create a Weekly and Monthly Shopping List
Planning weekly and monthly essentials can save both money and time.
Here’s a breakdown:
Monthly Shopping List (to buy in bulk):
- Pantry staples: Rice, pasta, cooking oil, canned goods
- Cleaning supplies: Laundry detergent, dish soap, toilet paper
- Personal care: Shampoo, toothpaste, deodorant
- Others: Coffee, long-life milk, non-perishable snacks
Weekly Essentials (for fresh needs):
- Produce: Fruit, vegetables, herbs
- Dairy and protein: Eggs, milk, cheese, chicken, or plant-based proteins
- Bakery: Bread, rolls, wraps
By having set shopping days and a detailed list, you can avoid impulse purchases. Shop at the beginning of each week to ensure fresh produce for meals, and review loyalty programs for added discounts.
The template includes “Expected Price” and “Actual Price”. This is because you might find long-life milk at R90 on special, but you know it’s R100 normally. So budget for the usual price, but record when it’s on special… Then you can either put the saved money away, buy a few extra treats, or use it for unexpected costs (maybe petrol goes up and you need that extra R10).
Step 5: Track Your Spending
Tracking where your money goes might seem tedious but is crucial for keeping your budget on course. This is the least fun part, but you won’t see positive results from budgeting if you skip this step.
Here’s a method that works well:
- Log Purchases Weekly: Every Sunday, go over receipts or bank statements.
- Adjust Based on Spending Trends: If you’re spending more on takeaways than planned, consider meal prepping to save.
- Weekly Reviews: Set aside 15 minutes each week to see if you’re on track with your budget, using it as a reality check for your spending habits.
Remember: It might take a while before this budgeting thing kicks in and becomes a habit. If you spent R200 more on spoils than you expected, don’t beat yourself up. This budget template allows you to ensure your important expenses are paid first, and you can always get better at saving.
Step 6: Evaluate and Adjust Your Budget
Once you’ve been budgeting for three months, take a step back and review. Repeat this process throughout the year, and try to make adjustments as realistically as possible. You might WANT to save R2000 every month, but you’re only managing R1000—that’s okay!
Here’s a checklist to follow:
- Did you meet your savings goal? If not, where did money fall short?
- Are you spending too much in one area? If transportation costs are higher than planned, consider carpooling or using public transit.
- Are you spending more than you make? Having to use credit to cover necessities? This is one of the best metrics to measure with this budget.
- Do you need to adjust your budget? Goals may change over time—adjust as needed!
Ready to be a Budgeting Boss?
Budgeting is really about creating a balance that works for you and being prepared for what’s next. With realistic goals and a little tracking, you can take a lot of the stress out of managing money. And remember, your budget isn’t set in stone—adjust it as life and income change.
Kick things off with our budget template, check in weekly, and soon, you’ll feel way more in control of your finances.
Ready to get started? Download the template, set up your categories, and take that first step toward building financial confidence!
