How to Make a Budget Spreadsheet, With Templates

Creating a budget is the first step toward taking control of your finances, both in life and in business. 

A budget spreadsheet provides a clear overview of your income and expenses, helping you identify opportunities to cut costs, spend less, and save money—all in service of working toward your financial goals. Although a business budget may entail more complexity than personal budgets, the overall framework is the same, and you can tailor your budget tracking to your specific needs. 

This guide will walk you through how to make a budget spreadsheet, provide budget templates for both personal and small business use, and answer some frequently asked questions about creating and maintaining effective budgets.

How to make a budget spreadsheet

1. Choose a budgeting approach
2. Create a spreadsheet
3. Gather all financial information
4. Forecast your total income
5. Create expense categories
6. Analyze and forecast your spending
7. Account for cash flow
8. Track real data
9. Review and adjust

Whether you’re looking to manage your business or personal finances as a small business owner, these steps will help you create a budget that works for you:

1. Choose a budgeting approach

Before you start creating a budget, decide on a budgeting system that fits your situation and needs. Personal and business budgets may help in accomplishing different objectives—a personal budget may be aimed at paying off debt or saving for a home, while a business budget may be aimed at achieving a certain profit margin or amount of revenue. But they both benefit from a similar, goal-oriented approach. This involves using historical data to forecast future income and expenses, helping you set realistic financial targets and an appropriate time frame.

Personal budget

For personal budgets, the zero-based budget is a popular and effective method. This approach ensures that every dollar of your income is assigned a specific purpose—such as an expense, a savings contribution, or a debt payment—until your total income minus your total expenses equals zero. 

This method is often combined with rules like the 50/30/20 rule, which provides a simple guideline for allocating 50% of your income to fixed expenses (needs), 30% to variable expenses (wants), and 20% to savings and debt repayment. By reviewing your past spending, you can forecast your future expenses, identify irregular costs, and create a realistic zero-based budget. A typical time frame for a personal budget is a month, as it fits with most income schedules and monthly bill cycles.

Business budget

A business uses the same fundamental logic but on a larger scale. While both can use historical data to forecast future income and expenses, a business often has variable revenue streams that can be difficult to predict, requiring more complex models. This helps you plan for seasonality, manage cash flow, and set realistic revenue targets. 

2. Create spreadsheet

Separating your budget into two sheets gives you both big-picture control and detailed tracking. Use a spreadsheet program like Google Sheets or Microsoft Excel—these tools allow you to use simple formulas and automation to save time.

You’ll need at least two sheets to track your finances:

• A summary sheet. This is your main dashboard. It will display your total income, total expenses, and spending targets for each category. This sheet is where you will see your overall financial health at a glance.

• A transactions sheet. This is your data entry hub. This is where you’ll record every transaction, using the date, amount, and category. This detailed record-keeping is the foundation of your budget and will automatically feed data to your summary sheet.

You can use formulas to automatically update totals, calculate metrics like gross profit margin (for a business), or your personal savings rate. You can even create charts to visualize your spending habits.

3. Gather all financial information

Hidden income and expenses in overlooked financial accounts can throw off your budget. Pull together your bank statements, pay stubs, and any credit card statements for the past three to six months. This will help you identify all sources of income and assess your typical spending habits.

Check these accounts along with your main checking account:

• Investment accounts. To track dividends or capital gains.

• Retirement accounts. To account for any contributions, especially if they are not reflected on your pay stub.

• Loan statements. Including for a car or student loan, to confirm your monthly payment amounts and remaining balances.

• Receipts or statements for less frequent expenses. This includes medical bills, car, maintenance, or annual subscriptions.

Small businesses will need their credit card and bank statements as well as additional information such as:

• Accounts receivable. Money owed to your business.

• Accounts payable. Bills your business owes.

• Point-of-sale (POS) reports. For retail or service-based businesses, this shows your daily sales.

• Payroll records. To track salaries, taxes, and other employee-related expenses.

• Loan statements. For business loans, lines of credit, or credit card debt.

• Invoices. Both for your sales and for the purchases you’ve made.

4. Forecast your total income

Start by calculating your total projected income for your chosen budget period (e.g., a month or a quarter). To do this, you’ll use historical financial data to make an educated forecast:

For a fixed salary

Use your net monthly pay from a recent pay stub as your projected income.

For variable income

When it comes to forecasting sales, freelance work, or commissions, the process requires a bit more analysis. Review your bank statements for the past three to six months and calculate your average monthly income. This average will serve as a realistic projection for your budget.

You can also forecast income based on signed contracts or confirmed client projects. For example, if you have a freelance contract for $3,000 to be paid out over the next two months, you can project $1,500 in income for each of those months.

For interest-bearing accounts

If you have an interest-bearing account, you can look at the historical interest earned and project that into the future. For instance, if your savings account typically earns $15 in interest each month, you can include that amount in your projected income. This level of detail ensures your budget is built on realistic expectations.

5. Create expense categories

Organize your personal spending into expense categories. A good budget spreadsheet includes fixed expenses like rent or car payments, and variable expenses like groceries or entertainment. These categories reveal spending patterns you’d miss tracking expenses as one lump sum.

Your business expense categories will look different. Track these main expense types:

• Cost of goods sold (COGS). Direct costs of producing your products or services, like materials, manufacturing, and the labor required to create your product or deliver services.

• Operating expenses. Day-to-day costs like rent, utilities, and administrative salaries.

• Administrative expenses. General overhead like office supplies and software subscriptions.

• Marketing and sales. Advertising costs, commissions, and sales team salaries.

• Taxes and licenses. Business taxes, permits, and fees.

• Professional fees. Accounting, legal, or consulting fees.

6. Analyze and forecast your spending

This analysis reveals where your money actually goes versus where you think it goes—which is where you’ll find money to redirect toward your goals.

Go through your bank account and credit card statements for the past three to six months and analyze your spending in each category.

• Housing. Look at your average monthly rent or mortgage payment, utilities, and insurance.

• Transportation. Review costs for gas, public transit, and car maintenance.

• Groceries. Find the total amount you typically spend on food each month.

Be honest and thorough with your historical spending analysis. Once you have an average for each category, you’ll set that as your initial budget target. This target is not a rigid rule but a spending goal you’ll aim for as you start tracking your active spending. The spreadsheet you’re building is a tool for this ongoing comparison.

7. Account for cash flow

Cash flow is the movement of money in and out of your business, and it directly impacts whether you can pay your bills on time.

Cash flow issues can disrupt an otherwise healthy business. You might have money coming—just not when you need it. Your business budget spreadsheet prevents these cash crunches by tracking when money moves, not just how much. 

While you may have a positive overall budget, the timing of money coming in (accounts receivable) versus money going out (accounts payable) can create problems. Your spreadsheet should help you monitor these inflows and outflows to ensure you always have enough cash on hand to cover your bills and operational costs.

For example, if you know a major client payment isn’t due for 45 days but your rent is due in 30 days. Your budget spreadsheet can help you foresee a potential cash shortage and plan for it. This helps you avoid a cash flow crisis, which can be just as damaging as a negative budget.

8. Track real data

A budget is a living document, not a one-time project. Once your budget spreadsheet is set up, input every expense into your spreadsheet’s categories as you spend. Throughout the budget period, diligently input every expense into your spreadsheet’s categories. This active tracking lets you compare your real spending against your targets. 

For personal budgets, this might mean a weekly check-in, while a business might track expenses daily. This process is how you gather the real-world data you need to make your budget work.

9. Review and adjust

At the end of each budget period, it’s time to review and adjust. Compare your budgeted amounts to your actual spending to perform a variance analysis. 

For personal budgets

This helps you quickly identify where you’re overspending and where you can save more. For example, you budgeted $400 for groceries but spent $550. You’ll need to figure out why and decide if you need to adjust your spending or your budget for the next period.

For business budgets

A variance analysis helps you identify any significant differences. For example, if marketing expenses were much higher than you budgeted, you’ll need to investigate why and adjust your strategy.

This process of analysis and adjustment is how you can use a budget spreadsheet to manage your finances. Use your findings to update your financial forecast for the coming months, ensuring your budget remains a relevant and powerful tool.

Small business budget template

A well-designed small business budget template is essential for tracking your business’s financial performance. Here’s how to use it:

1. Customize your accounts

Start by tailoring the template’s existing categories to your specific business model. A template will include standard accounts like sales revenue and cost of goods sold (COGS), but you should customize these to reflect your company’s income and expense streams. For example, a consulting firm might change sales revenue to client fees, while a retail business might add accounts for credit card processing fees or shipping costs.

2. Set your financial forecasts

On the main budget sheet, input your financial forecasts for the upcoming period. This isn’t just about what you’ve spent in the past; it’s about what you plan to spend and earn based on sales projections, marketing plans, and operational needs, along with your forecasted cash flow. Enter your projected revenue for each category, and set a budgeted expense for every account.

3. Track all transactions

The template includes a separate transactions tab for logging every business-related expense and income item. This is where you’ll record every transaction as it occurs, including the date, a brief description, the amount, and the corresponding account. 

4. Revise and analyze your performance

The main budget sheet automatically pulls data from your transactions tab to show you how your actual income and expenses compare to your forecasts. This allows you to perform a variance analysis to see if you are meeting your financial targets. Use this analysis to make informed decisions.

Personal budget template

A budget template provides a ready-made structure and can save you significant time. The following template includes a framework to track your budget. Here’s how to use it:

1. Customize your income and expense categories

The template includes a list of common income and expense categories, but you can change these to match your personal spending. You just need to click on the category cell and type in a new name. For example, you might want a specific category for car maintenance or student loan payments.

2. Set up your spending targets

On the main budget sheet, you’ll see a column for budgeted amounts. Based on your historical spending data, input a realistic spending target for each category. You’ll also want to set a time frame, whether you establish a monthly budget or one for an entire quarter or year. For that matter, you can also go smaller—a weekly budget or one you make for each pay period can work too, especially underneath the umbrella of a larger budget.

3. Track your transactions

The template includes a separate Transactions tab for logging every expense and income item. As you spend and earn money throughout the month, enter the date, a description, the amount, and select the corresponding expense or income category. This is how you’ll track your real-time spending.

4. Review your summary

The summary tab automatically pulls data from your Transactions tab to show you how your actual spending compares to your budgeted targets. You’ll be able to see where you’re on track and where you might need to make adjustments to meet your financial goals.