My No-Budget Guide to Personal Finance: Part 3, The Monthly Review (with FREE spreadsheet download)

The month of August is over and we just finished our monthly review!  This month's review included new spreadsheets and charts for the kids. All spreadsheets and charts below have their values changed to protect the guilty.  It's the process that's important!  (If you haven't seen part 1 and part 2 of my no-budget guide, check them out first... background is important!)

My Spreadsheet

Let's start by getting acquainted with a simplified version of my spreadsheet (that you can download for FREE).  I have 3 tabs that we look at monthly, plus one more that we look at yearly.  These tabs are:

  • Spending Plan (really more of a spending prediction than a plan)
  • Mr. & Mrs. Net Worth - 2017
  • Kid Net Worth (Each kid should have a tab of their own)
  • Mr. & Mrs. Net Worth - YEARLY (this is reviewed in January)
Worksheet Tabs.png

Our Monthly Spending Review

After every month (August for example) is complete and all transactions are cleared in the bank we summarize the month's spending and income information in the spreadsheet.  Here's how I do that:

  1. Duplicate the "Spending Plan" tab and re-name it for the month that was just completed. (Hide the old tab to keep it looking clean.)
  2. In the new tab, enter the summarized spending and income data from the CheckBook App into the column for the newly finished month.  (E.g. total spending for August's groceries gets logged into the spreadsheet, not all grocery transactions.)
  3. Review the Surplus/Deficit for the year (green). The goal is to either spend or invest everything so we aim for a surplus/deficit of $0.  In this hypothetical example I have a deficit of $420... so we hypothetically spent more than we thought we would.  I would need to subtract that $420 from the $1262.01 Vanguard investment that we predicted we would make in September.
  4. Login to Vanguard and invest! 
  5. Share the months spending information with Mr. Sense. I may print out the spreadsheet, or create a chart to share with the kids too, or sometimes just a text to say "we spent a lot more than expected on Lil Sense's birthday bike, but the good thing is that school clothes didn't cost as much as we thought they would."
Past, current, and future predicted spending - all in one place

Past, current, and future predicted spending - all in one place

 

Mr & Mrs Sense Net Worth Review

Hypothetical grown-up net worth

Hypothetical grown-up net worth

After I've entered all of our spending data, I move on to investment data.  I log into each of our accounts (investments, mortgage, credit, checking...) and capture a snapshot of the values of each.  It's easy... there's a tab to log and graph these things.  

Then of course I share that newly updated net worth with Mr. Sense.  Sometimes I do this via a printout. Other times I'll say "hey come look." But usually it's just a text message with a quick "FYI... Net Worth is up to $1 gazillion."

There are usually no surprises so it's not much of a conversation.  Occasionally if something big is going on (like buying a house) these conversations will take more time and involve some scheming.  In the future I think we should talk more often about which funds we're invested in and whether we need to modify our approach.

Jr and Lil Sense Net Worth Review

We just started tracking Jr and Lil's money. August was their first full month of investing!  I was so excited to finally add them into my spreadsheet.  I love to share graphs and charts with the kids, it makes for some great (and educational) conversation.  Most importantly, they are excited to be watching their money grow.  I'll write more on their net worth review in the future!

hypothetical kids net worth

hypothetical kids net worth

The Key to Our Success

While I may be able to sum up our our accounting method in a series of posts, it's actually the result of years of iterations. Little tweaks over a long period of time got us to this point.

Even if you don't agree with my no-budget approach, I hope you will take away the fact that the most important aspect of any budgeting or accounting approach is the opportunity it creates to communicate and improve your financial standing!

If you're interested in using my spreadsheet, just download it here for FREE!