Making a budget is a lot like making recordings of yourself. It’s tedious and time consuming, and makes you cringe.

On the other hand, it gives you an objective look at what is going on. That clarity ultimately gives you more self knowledge and confidence.

There is no better time than now to start a budget. Everything is in flux right now and this is a way to gain some control over your future.

When you make your first budget, don’t be complicated. Don’t make a billion categories and color code everything. Be very simple and basic, because it will be more flexible that way.

You can use an app like Mint (there are many others), a spreadsheet, or even a sheet of paper or notebook. I use Google sheets because it’s easy to update on my phone. I create a new sheet for each month, and at the end of the year I have a handy record of all my expenses and income for the year!

1. Income

Calculate your income for the month. If you have variable income (like most of us), budget based on the low end. List each source of income and your best guess of how much you’ll receive in your bank account (after taxes).

If you’re not sure what you’re going to earn because your job/hours are in question, talk to your boss. It’s hard to ask, but it’s important to have those lines of communication open. They may not know themselves what is going to happen, but they will certainly understand you asking.

If you have low confidence that your job will continue to support you through coronavirus, start applying and researching possible income streams. It’s not too early to search, and if your job does end up continuing, you can always decline the new job.

2. Expenses

There are many different ways to categorize expenses, but keep it as simple as possible. I like to separate “bills” from “daily needs.”

Bills are the expenses that recur with a predictable amount, like rent or car insurance. Daily needs are expenses that fluctuate, like groceries and gas.

List the essentials (home, food, insurance, gas, etc) at the top and order them by priority. That will help you decide what is important to you, and make it easy to cut out unnecessary expenses. Include money for your savings account as an “expense,” so you can build an emergency fund.

And that’s it! Keep it simple.

The short story is, your income HAS to be greater than your expenses or you will go into debt. There’s just no way around it. You may need to increase your income and get another job, or slash some unnecessary expenses. It’s all a constantly shifting balance.

Before coronavirus shut everything down, we had finally (after two years in LA) created a more comfortable financial situation. It is frustrating to have a lot of that work now shut down.

On the bright side, my year of extreme budgeting and self-guided study in personal finance left me well prepared to face these major financial changes.

I’m a little worried about the future, but one of the side effects of being open about my financial struggles is being offered a lot of support. Many of our family and friends have offered to help us, which gives me some peace of mind. I know relying on them is not a long term solution, but it does buy us some time in our job search.