Creating a personal budget

Creating a personal budget is the best way to accomplish your financial goals. It's also a great way to see how you’re faring in terms of your individual finances and make adjustments if necessary. Want to track your finances more closely? Learn more about monthly budgeting. Managing your entire family's budget and would like our advice? Please take advantage of our tips for a balanced family budget.

Create your personal budget in 3 steps

Step 1

Set your goal


Whether it's for a meaningful personal trip, paying off a loan or investing in a loved one's RESP, you need to be specific. Estimate how much you want to save and how long it will take you to get there.

Step 2

Calculate your income and your expenses

Calculate your average monthly income as well as your fixed expenses. Take the time to make a complete list of your expenses and cash inflows.

Step 3

Adjust your budget or your target


Take the total amount of your monthly income, then subtract the total amount of your expenses. This will give you the amount of money you have left over each month. Multiply this amount by the number of months you've given yourself to reach your target. This calculation will allow you to see if your goal is realistic or if you need to find a way to reduce your expenses.

(MONTHLY INCOME – MONTHLY EXPENSES) x NUMBER OF MONTHS = YOUR SAVINGS TARGET

Our best tips to create a personal budget

  • Beware of small, repetitive expenses: it may be cliché to blame it on lattes from the corner deli, but there's a good reason why we often hear this example of small, unnecessary expenses! That's why, when evaluating your expenses, you shouldn't overlook those little extras that add up quickly.
  • Allow yourself a little leeway for the unexpected: it's better to be cautious than to get caught out when something goes wrong and round up your planned expenses! There is no magic number, but estimating the cost of a major car repair or the price of a new appliance in advance is always a good place to start.
  • Think of your expenses that come up only once a year: driver's license, passport, dentist... certain expenses don't come up often, but they still impact your budget. Small tip: go back and look at your statements from the previous year. This will allow you to factor the total amount of such expenses into your personal budget.

Use a budget calculator

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