Personal Finance: How to Excel in Microsoft Excel

One of the best and most basic personal finance tools available right now is Microsoft Excel. If you have PC, you’ve probably already got it installed on your computer. Unfortunately, many people don’t have more than a basic proficiency with this valuable tool. We’re here to remedy that. There are lots of personal finance things you can do with Excel, so here are just a few things to try today:

1. Make a Budget

Making a budget in Excel is nice because you can set it up to automatically do the math for you. All you need here is a line by line account of your spending. It can be nice to put it in different categories so that you can see how much you’re spending on housing, food, entertainment, etc.

To make a basic budget in Excel, first decide on what broad and minute categories you’ll have. For instance, you might have a Food category with the smaller categories Groceries, Eating Out, Fast Food, and Coffee underneath. This helps break things down and keep them more organized.

The simplest way to do this is to use the left hand column for your budget categories. In bold, make your top category, and then list each subcategory under it. If you want your budget sheet to go across rather than down in endless lines, you can leave four or five columns between and then start another list of budgeting items. Then, beside each item, you simply have to write in the amount you’d like to spend on each category in a month, a week, or two weeks – depending on how your paychecks come.

After you’ve finished a line for a category, highlight all of the budgets for that category and then click the Auto Sum button. It will automatically total up the amount of money you’ve budgeted for that broad category.

Once all your categories are summed up like this, you simply need to add up the category totals to make sure that your budgeted spending is equal to or less than your actual income for the period. If not, do some adjusting. The Auto Sum button is helpful here because it takes much of the work out of the math involved.

2. Track Your Spending

Once you’ve made a budget, you can actually set up Excel to help you track your spending. This is much more complicated, so you might want to use a template that’s available on Microsoft’s website. There are several personal and household budgeting templates available there that can be helpful for tracking your spending. Often, you just plug in the actual spending numbers, and the spreadsheet will automatically track how much of your budget is left, or it will show where you’ve over-spent.

Tracking your budget in Excel is pretty simple, and it’s free, which is always budget-friendly. You may want to try out a few templates and work on customizing one for your needs so that you know exactly what you have available to spend each month. At the end of the month, look back over your spreadsheet to see where you spent less or more than you allotted. Can you cut back on spending, or are there areas where you need to shift funds around? Keep your spreadsheets in the same folder so you can track spending over time.

3. Snowball Your Debt

You can also use Excel templates to snowball your debt or manage it properly. If you’re trying to pay down debts, one of the best ways to do it is by paying down the smallest first, and then adding in payments as you get to your larger debts. There is an Excel template that you can plug your debt numbers into so you can see how long it will take to pay off your debts.

Debt management spreadsheets can be helpful for working with your credit cards. These sheets can help you track all your credit card information in one place. At a glance, you’ll be able to see which has the best interest rate, and which balances need to be paid down a bit to save your credit score. These templates can be incredibly helpful because, again, they’ll do much of the math for you as long as you plug in the proper numbers.

This post is from Abigail Hall, writer at CreditDonkey.com.  Visit CreditDonkey to find credit card tips to budget, track your spending and manage your debt.