originally published on WalletHub.com on March 5, 2025
Full article: https://wallethub.com/edu/b/budget-categories/144143#expert=Axel_Stock
What are the most important categories to include in a budget?
The most important categories include Income, i.e. how much money you have available to spend, Housing, Utilities, Transportation and Food.
What categories do people often forget to include?
I would think that setting a budget for an emergency fund for unexpected expenses like medical emergencies or car repairs is often overlooked. Similarly, people seldom plan for Home maintenance which includes costs for home repairs.
Is it possible to have too many categories in your budget?
Yes, while it is important to be thorough, having too many categories can make your budget overly complicated and harder to manage.
What are some tips that can help people organize their expenses better?
I have two ideas. First, one would want to track their spending: Use apps or spreadsheets to record every expense. This helps you see where your money is going and identify patterns. Second, it is useful to categorize expenses: Group similar expenses together, such as groceries, utilities, and entertainment. This makes it easier to see how much you are spending in each area.