Creating a budget in Excel is a practical way to manage your finances. By tracking your planned and actual expenses, you can easily monitor your spending and identify areas for improvement. Here, we will show you how to create a simple budget and calculate variances between actual and planned expenses.
Budget Sheet Design
Below is an example of what your budget sheet should look like in Excel:
Instructions
- Set up your categories and planned expenses: In the first column, list all the categories where you spend money. In the second column, input your planned expenses for each category.
- Track your actual expenses: As you spend money, update the third column with your actual expenses.
- Calculate the variance: In the fourth column, subtract the planned expense from the actual expense to find the variance. A positive number means you overspent, while a negative number means you spent less than planned.
Exercise
Task: Create a budget sheet with the following categories: Rent, Utilities, Food, Transport, and Entertainment. Fill in your planned expenses, then update it with your actual expenses at the end of the month.
Solution
To calculate variance, you need to subtract Planned Expense from Actual Expense.
For more detailed guides and advanced techniques, consider visiting sites such as Microsoft's Excel Budget Templates or Investopedia's Budgeting Tips.