I’ve started budgeting 10 years ago when I just started my first job and I should say I’m not a “know-it-all”. Budgeting was not an easy task for me when I started. However, there are few things I learned over the years that helped me stick to my budget.

An important aspect of budgeting is defining the right categories. It helps allocate money into each set of expense and it’s easy to track exactly where the money goes. I have provided the list of categories I’m currently using to track my budget. These are for references only and tweak it for your family needs.


Since we have had some life changing events (in a good way) in the past few months, our spend increased relatively. It’s totally understandable as we have a baby now and both the set of grand parents have been visiting us from India. Combining everything that’s been going on in our lives, our spend went up drastically.

However, we had budget assigned for these volatile expenses as well. Even though the budget for these expenses is quite rough, it gave us an idea of how much we need to keep in the bank account and where the money really goes.

Below are the categories we use to budget our expenses. Kids expenses were added after I got pregnant. Parents traveling goes under “travel” budget.

Grocery: Grocery includes everything for kitchen and household from produce to cleaning suppliers. I try to use coupons as much as possible to stretch the budget.

Eat Out: We love eating out. So, out eat out budget is higher than a normal household (Hey! everyone has something to splurge on).

Billing: Billing includes all types of bills we pay every month + gas expenses

Auto: Money allocated for any kind of auto expenses (oil change etc..)

Education: Money to spend on certifications et al for career growth

His & Her Personal: Money to spend on Ck’s and Uma’s personal expenses

Kids: Money to spend on Chuttu’s day care and personal expenses

Entertainment: Money to spend on movies, gifts etc

Splurge For Him & Her: Each of us can spend the splurge money in however way we want. The other person should not ask questions. It helps us to keep our budget on track.

General Shopping: Money to spend on general household expenses

Travel: One more category that has high budget. We love to travel and we spread our travel expenses across months. That way we won’t feel bad when we spend high dollars for travel

Miscellaneous: Money to cover unexpected expenses

Additional Read:  

Art of Family Budgeting Part 2: Budgeting Tools Reviews

Art Of Family Budgeting Part 3: Things To Remember

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