You created your budget! Awesome… but did you include all budget categories or are they just to general? 

When setting up a budget including all necessary budget categories is important. It allows you to see exactly where your money is going and helps you control your spending on discretionary expenses.

Before we dive into the budget categories, first let me explain why you need a budget.

Why Do I Need to Budget My Money?

Budgeting is important because it allows you to gain control over where your money is going and what it’s being spent on.

It helps you to break free from the crushing living from paycheck to paycheck cycle so you can stop worrying about making ends meet every week.

When you don’t have a budget, it’s really difficult to know exactly how much you’ve spent on your basic living expenses as opposed to how much you’ve spent on wants or non-necessities.

Of course, the goal of budgeting is to make sure you have enough money to pay for the basics without getting into debt

It’s how you are going to live below your means and have money left over for things like saving for emergencies, building a good-sized retirement account, and affording to do the fun stuff too.

A budget can also help you reach financial freedom and even wealth if you play your cards right…

Types of budgets

There are many different ways you can budget your money. Some of the most popular methods are…

Cash Envelope System 

The cash envelope system is an easier way to budget using cash only which is meant to make you more aware of where your money is going and how it’s being spent.

This budgeting method has been around forever and is endorsed by Dave Ramsey, so you know it works. 

50/20/30 Budget Rule

The 50/20/30 Budget Rule is a way of budgeting that allocates a specific percentage of your income to three main budget categories. 

The rule states that no more than 50% of your income should go on living expenses, 20% into savings and 30% on wants or luxuries.

Zero Based Budget

The goal of a zero-based budget is to make your income minus the outgoing cash flow equal zero. 

If you cover all your expenses during the month and have money left over, you must allocate the money to a specific purpose such as an emergency savings fund or retirement account so every penny is accounted for.

Reverse Budgeting

Reverse Budgeting is when you pay yourself first in the form of saving for emergencies and your retirement IRA or 401K plan.

This is to ensure these important budget categories are not forgotten or pushed to the side. Whatever is left over goes on your living expenses, other types of savings, and discretionary spending.

It doesn’t really matter which type of budget you choose to use as long as you use one and stick to it. Just pick what best fits into your lifestyle.

Ideas of budget categories you need to consider

How to Track Your Budget

Once you’ve decided on the type of budget you will be using, it’s time to think about how you are going to track your progress.

There are many ways to track your budget, you can use a budget app such as Personal Capital that makes it super simple to track all your budget categories and expenses by linking your debit and credit cards.

Personal Capital records all the expenses you pay when using your linked cards and categorizes them for you. 

There is some maintenance needed but it’s minimal and what’s even better is that you can see how you are doing with your budget throughout the month without having to track every penny yourself.

Some other options are using a budget planner or free budget printables, this works well if you are the type of person who prefers pen and paper.

Budget spreadsheets are another great option if spreadsheets are your thing. You can create your own personalized budget using Excel or Google Sheets. 

You can even download a budget template spreadsheet and customize it to fit your needs and budget categories.

Once you’ve determined how you are going to track your budget, it’s time to divide up your expenses by grouping them into budget categories.

Looking for an easy way to track your budget? Look no further, the Budgeting Made Easy spreadsheet is one of the easiest ways to stay on top of your budget. 


Budget Spreadsheet for Excel or Google Sheets


100 Budget Categories To Consider To Manage Your Money Better

I’ve come up with a list of 100 budget categories that could be included. By no means do you need to use every single one of them, just pick the ones that are relevant to you and your lifestyle?

You should first list your basic living expenses, you know that things that you can not do without like mortgage payments, electricity and so on. 

Whatever is left in your budget then would go on your wants, this would include things like cable and cell phone plans, etc…


The amount of money we bring in every month is how we determine which expense budget categories we include in our plan.

It determines which expenses you can afford to include and which you need to cut back on. Of course, you would include the budget categories that are “needs” first. 

If there is money to spare, then you can add in the budget categories that are “wants” and what’s most important to you.


  • Regular Salary
  • Alimony
  • Child Support
  • Dividend Income
  • Bonuses
  • Income Tax Returns
  • Side Hustle Income

Household Expenses

Housing Budget Categories

For most of us, housing is one of the largest monthly expenses we have each month. 

It’s not just our mortgage payments or rent, it includes all the other financial obligations that come with owning or renting. 


  • Mortgage
  • Rent
  • Property Taxes
  • Household Repairs
  • HOA Fees
  • Maintenance

Food Budget Categories

Typically when we budget for food, we generally include our weekly grocery budget, that’s a given. 

But there are many other expenses that need to be included in this budget category. 


  • Groceries
  • Takeout
  • Work and school lunches
  • Restaurants
  • Vending Machines/Convenience Store

Insurance Budget Categories

Nobody likes to have to pay insurance premiums. It seems like such a waste but it’s one of the best investments you can make to protect yourself from financial hardships should something happen.


  • Life Insurance
  • Medical Insurance
  • Disability Insurance
  • Dental Insurance
  • Vision Insurance
  • Long-Term Care Insurance
  • Vehicle Insurance
  • Homeowners Insurance 
  • Renters Insurance


Transportation Budget Categories

Getting where you need to be takes more than just having a car payment. 

You need that vehicle to get from point A to point B which means that there are many more expenses that come into play.


  • Car Payments
  • Fuel
  • Oil Changes
  • Maintenance
  • Parking Fees
  • Repairs
  • Licensing & DMV Fees
  • Shared-ride fees
  • Train/Bus charges
  • Roadside Assistance Fees

Utility Costs

Utility Budget Categories

We all have utility expenses that we need to include in our budget categories although not all are necessities. 

Some of these are actual needs such as water & electricity, but other utilities are wants like cable and internet.


  • Electricity
  • Water
  • Heating Fuel
  • Gas
  • Trash Removal
  • Phone (both cell and landline)
  • Cable
  • Water
  • Sewer
  • Internet services

Medical Expense Budget Categories

Medical Budget Categories

Nobody likes to think about getting sick or hurt, but it’s bound to happen at one time or another. 

Better to plan for it than let it ruin your budget and cause you financial hardships.


  • Health Care
  • Dental Care
  • Prescription Medications
  • Co-Payments 
  • Over the counter meds
  • Specialty Care


Household Budget Categories

We all need to buy household items to keep our homes clean, beautiful, and running like clockwork.  Some of these budget categories are needs while others are wants.

Make sure you prioritize the most important ones in your monthly budget and save up for big-ticket items such as furniture and appliances.


  • Cleaning Supplies
  • Tools
  • Decor
  • Furniture
  • Housewares
  • Appliances

Personal Budget Categories

Just because you want to do well at budgeting, doesn’t mean you should neglect your personal needs and appearance.

You just need to be reasonable about what you actually need and what are luxuries you can’t afford.

  • Toiletries
  • Gym Memberships
  • Hair Cuts
  • Salon Services
  • Cosmetics

Savings Budget Categories

Saving for things we want and need is important when trying to stick to a budget. It guarantees we don’t get into debt by using credit.

Some of these budget categories are musts such as emergency savings and retirement accounts so make sure you prioritize those in your budget


  • Retirement Savings – IRA or 401K
  • College Fund
  • Big Ticket Items
  • Hill and Valley Fund (if on an irregular income)


Education Budget Categories

Whether you are in school working toward a higher degree or you have children in school, there are many expenses that are required.


  • Books
  • Tuition
  • Parking Pass
  • Certification Fees
  • School Fees
  • Sports Equipment/Uniforms
  • Childcare

Debt Reduction Budget Categories

If you have debts, then the best thing you can do for yourself and your budget is to get rid of them as fast as you can. 

Once they are paid off, you will free up more money to save for the things that you want so you don’t have to get into debt again.

  • Credit Card Debt
  • Student Loans
  • Personal Loans
  • Mortgage
  • Home Equity Line of Credit

Entertainment Budget Categories

Everybody needs to have a little fun once in a while. Even if you are trying to stick to a budget, you can still have fun, as long as you budget for it.

Here are some entertainment budget categories that you might consider budgeting for, just make sure you don’t go overboard.

  • Fun Money
  • Nights on the Town
  • Sporting Events
  • Concerts
  • Vacations
  • Subscriptions
  • Memberships

Pet Care Budget Categories

Pet Care Budget Categories

Our furry friends are part of our family and have their own needs to keep them healthy and happy.

It can get expensive to have pets so make sure you can handle the extra expenses when considering getting pets.

  • Pet Food
  • Wellness Checks
  • Shots
  • Pet Insurance
  • Grooming


Gifting Budget Categories

Gifts are a budget category that is often forgotten until the last minute and can have a way of creeping upon us. 

Planning ahead of time is the best way to make sure we don’t take on debts when a special occasion arises.


  • Charitable Gifts
  • Birthday
  • Anniversary
  • Wedding
  • Christmas Gifts
  • Special Occasions & Holidays


Clothing Budget Categories

Clothing is a necessity that we need to work into our budgets, but there is no need to walk around with a $2000 handbag just because you want it.

Make sure you work the basic items needed into your budget. If you really want those expensive pieces, make sure to save up.


  • Children’s Clothing
  • Adult’s Clothing
  • Work Clothes
  • Seasonal Clothing
  • Outerwear
  • Special Occasion

Budget Catatories Conclusion

Living on a budget takes a lot of getting used to, you are probably going to fail to stick to it for the first few months. That’s ok, it happens to everybody…

The key is to adjust your budget categories and spending habits, then keep at it. You will get it, I promise! 

Related budgeting articles you might be interested in

9 Budget challenges we all face and how to overcome them

10 Reasons you have no money & how to fix it

Cash envelope system explained: why use it and how to get started

How to plan for unexpected expenses to avoid budgeting your budget

Managing money like a pro – 21 money management skills we all need to master

How to stop spending money – 14 tips to stop overspending for good

Emergency savings 101 – Everything you need to know to avoid financial disaster

How to budget money the right way

15 Free budget planner templates

How to stop living paycheck to paycheck

Living below your means: Everything you need to know to get started

How to save money fast with a no-spend challenge

One simple reason you can’t stick to your budget

The ultimate guide to reaching your financial goals

5 Bad financial habits you must break

How to teach your teen to manage money

10 Financial habits you need to start doing today

Why young families need a financial plan and what to include