This is an example budget. It has some similarities to our budget when we first started this process. I tried to make it based on an “average” family and make it as realistic as possible. I hope this will get you started on creating your own budget.

Old Budget New Budget Comment
Income 1 2800  2800
Income 2 1500  1500
Savings: Current: $200 in savings account
Emergency Fund 0 167
Retirement 0  0
Rent 800 800
Electricity 100 100
Water 48 48
Gas 70 70
Phone 115 70  Change service to the lowest/basic service if you are unable to cancel your service because you are under contract. If you are not under contract, look into pay as you go phones, explore the most affordable options.
Garbage 40 40
Cable 60 0  Cancel, if you are on contract call and place a 6 month “hold” on  your account until you can get an emergency fund in place and some of your debt paid off.
Internet 45 0  Same as cable.
Grocery 500 500  You will need to shop sales and/or use a few coupons. You will be needing to buy more food on the same budget because you are eating at restaurants less.
Restaurants 200 50  Reduce eating out to 1-2 times a month with a goal of not seeing the inside of a restaurant (unless you are working at one) until your debt is paid off.
Car Payment 1 ($5000) 300 300  Consider selling one of your vehicles if you can buy something that is cheap/reliable with the difference in what you owe and what your vehicle is worth, if it will reduce your debt.
Car Payment 2 ($7000) 200 200
Insurance 140 140
Gas/Oil 400 300 Car pool 1-2 a week to work and combine trips. Walk whenever possible.
Taxes/License 70 70
Adults 100 20  This is a “sinking fund” for ONLY required/necessary clothing
Children 50 20  “sinking fund”. Buy clothes at thrift shops, garage sales, neighbors/friends. When children out grow current clothes sell them for replacements.
Insurance 30 30
Child Care 500 500  Look into more affordable options. Private in-home daycare?
Hair Care 120 60  Go a little longer between hair appointments. Look into local cosmetology schools for discounted services.
Organization Dues/Subscriptions 50 0  All unnecessary cost need to eliminated while paying off debt.
Gifts 100 20  Sinking fund. You are going to have to get “creative” with your gift giving and eliminate giving some gifts.
Miscellaneous 100 100
Blow Money 200 80  Avoid stores, fast food, coffee shops, or whatever is “tempting” to you but is not a necessity.
Entertainment 150 40  You still need to have fun. But seek out activities that are “free” or as close to free as you can get.
Vacation 0 0  If it is your goal to vacation, sacrifice for a year while paying off debt and then start saving each month for a vacation.
Credit Card 1 ($5500) 175 175
Credit Card 2 ($1000) 50 50
Student Loan 1 ($35,000) 350 350
Income-Expenses= -763 0
  1. Save the $167/month and any extra you can come up with in your budget to get $1000 in your emergency fund ASAP!!! You need this extra cushion to prevent further debt. This is only for emergencies: car repairs, medical expenses, etc. Sell something, get a temporary second job. You need this $1000, and quick!
  2. After you have $1000 in your emergency fund, start applying your “extra” to your lowest debt ($1000 Credit Card).
  3. Continue paying off your debts using a debt snow ball. Make the necessary cuts in your budget. Whatever you need to do to “win” 🙂

If you have any questions, please feel free to leave a comment or e-mail me at budgetlovingmilitarywife@gmail.com

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