How to set up a budgeting spreadsheet you will keep using

The budgeting spreadsheet you keep using is the plain one you check for ten minutes every payday. A blank page might feel daunting, but you only need a few simple columns and basic sums to see exactly where your income goes. You can set this up in a free spreadsheet program in one quiet afternoon.

Gather your financial paperwork first

Before you type anything into a spreadsheet, you need to know exactly what is coming in and going out. Citizens Advice suggests gathering recent bank statements, payslips, card statements, bills and receipts for cash spending before working out a budget. Aim for three months of paperwork laid out on the kitchen table to get a true picture.

One month of spending rarely tells the whole story. A single bank statement might miss a quarterly water bill. It might cover a quiet four weeks where you spent very little, hiding the true cost of your daily life. Pulling three months of records shows your average food shop and highlights the rolling subscriptions you forgot about.

Look closely at direct debits and standing orders to make sure they are still correct. If you prefer a ready-made option before building your own, Citizens Advice points people to a free budget planner on the MoneyHelper website. Making your own from scratch takes a bit more time, but it means you can shape the categories around your own family.

Set out the columns and rows

Open your free spreadsheet program and start a new blank document. Give your columns simple headings in the top row. Write the category name in the first box on the left, and make the next box your planned amount. Label the third box actual spending, and the fourth box the difference.

Your first section covers money coming in. List your wages, any benefits, child maintenance and side income in separate rows down the left. Leave a blank row underneath. This space separates your income from your costs.

Next, list your fixed bills, which are the payments that go out on the same day for the same amount. Put your mortgage or rent at the top. Follow this with council tax, energy, broadband, water and any regular fixed payments. Add rows for your mobile phone and any television services, then type the expected cost into your planned amount column.

Add your flexible household spending

Your flexible spending changes from week to week, and this section needs the most attention because it is the easiest place to overspend. Group these costs directly below your fixed bills. ONS figures released on 10 September 2025 show UK households spent an average of £623.30 a week between April 2023 and March 2024. Your own number will depend heavily on the size of your household and where you live.

Create a row for groceries. This covers the main supermarket shop and any small top-ups at the local corner shop. Make a separate row for takeaways and eating out. Keeping these apart helps you spot exactly how much convenience food costs you over a full month.

Add rows for petrol, train fares or bus passes. Setting out the right categories keeps the sheet easy to read. Give personal care its own row for haircuts, toiletries and pharmacy trips. Include a row for clothing and shoes, and add a general section for days out, hobbies and entertainment.

Citizens Advice says a budget should record every expense, including money spent on a partner or family. If you buy school uniform, pay for swimming lessons or give weekly pocket money, write these down in their own rows. Leaving them out makes the month look cheaper than it is.

Plan for the costs that only happen occasionally

Some of your biggest bills do not arrive on a monthly schedule. A car MOT, home insurance renewal and Christmas can easily break a monthly plan. Planning for these occasional costs stops them causing a panic in the weeks before they are due.

Work out how much these annual events cost in total and divide that final figure by 12. Add a new section to the sheet for annual costs. Put the monthly slice of the car service or the holiday into your planned column. Treat these amounts like a fixed bill and move that money into a separate savings account each payday.

Remember the smaller annual costs too. Add rows for family birthdays, dentist check-ups, optician appointments and boiler servicing. It might feel strange setting aside a few pounds a month for the dentist. It makes perfect sense when a filling is needed and the money is already there.

Write simple formulas to do the hard work

A good budgeting spreadsheet calculates your totals for you, so you never need a calculator once the right formulas are in place. Click on the empty box at the very bottom of your planned income column. Type an equals sign, the word SUM, and open a bracket. Highlight all your income amounts above it, close the bracket and press enter to add them up.

Do exactly the same at the bottom of your fixed bills, your flexible spending and your annual costs. You now have totals for your expected income and your expected outgoings. Copy these formula cells and paste them into your actual spending column, so the spreadsheet tracks what you really spend as the month progresses.

To find out what is left over, click an empty box at the bottom of the page and type an equals sign. Click your total income box, type a minus sign, and click your total bills box before pressing enter. This shows your planned remaining money. Adjust your planned flexible spending until the final number is zero or above, as knowing what money is left over helps you plan savings or treat the family.

Colour code the rows so problems stand out

Rows of black numbers on a white screen can blur together. Adding colour makes the sheet much easier to read on a busy evening.

Use a pale green background for your total income row. Highlight your total fixed bills in pale orange, as these are the solid commitments that must leave your bank account. Use a soft blue or yellow for your flexible spending totals.

You can also colour code the difference column, which subtracts your actual spending from your planned spending. Set up a conditional formatting rule to colour these numbers automatically. Turn any negative numbers in this column red and any positive numbers green. A quick scroll down the page tells you immediately if you are staying on track.

Keep the habit going with a payday review

A spreadsheet only works if you keep opening it. Set aside ten minutes on payday to update your numbers. Sit down at the kitchen table, open your banking app and look at your new balance.

Copy last month's entire spreadsheet page and paste it into a new tab, ready for the coming month. Check your planned spending column, as some months need tweaking. December needs more food money than February, and August might need a bigger transport budget for the school holidays. Adjust the numbers until your total at the bottom balances out again.

Through the month, type your actual spending into the sheet every time you buy groceries or fill the car. Watching the numbers change keeps you accountable to yourself. If the food row turns red by the third week, you can lean on the freezer for the rest of the month.