Welcome to the Victory Cashflow worksheet. Spending just half an hour each month will ensure your budget is maintained and your finances are in order. The objective of this budget is to predict the future balance of your bank accounts and run surpluses as often as you can, investing them for later use. Your internet banking can tell you what is in your account today but it can t tell you how to alter your spending habits to accurately predict the balance six months ahead. Successful budgeting is all about being pro-active and always considering the opportunity cost. This means if I spend this much now, what am I going to have to miss out on? I only have limited resources no matter how wealthy I am. Success is also about making budgeting a habit. Revisit and alter this worksheet often and you will be totally in control of your finances. Let s get started. In order to set up your budget worksheet you will need the following Historical bank statements for at least the last month A calendar A calculator Evidence of how much you earn Evidence of regular large fixed bills such as yearly insurances and taxes Allow 90 minutes of your time to get started and learn the process Getting Started Download the excel spreadsheet form our website and open the file. Make sure you save the file on your desktop. You will see a list of fixed and variable expenses for a current, credit card and savings account. You will see a horizontal scroll bar down the bottom in which to scroll across the next 24 months. A vertical scroll bar takes you down the worksheet past the current account to the credit card and savings account worksheets. Your current account is one you should use on a day to day basis but many people use their credit card for many items.
Each worksheet is separated into income, fixed and variable expenses. Fixed expenses are those that do not change often from month to month and can be accurately predicted into the future. Variable expenses are outflows that vary in amount and occurrence. When managing finances it is useful to separate variable and fixed expenses. Step 1: Customise the named text to suit your life. If you wish to change the text in a row simply highlight the cell and rewrite it. You can t remove rows from this worksheet. Project your expenses Now we need to focus on the projected monthly budget. This is the first column after the named expenses. We do this get an idea of what your monthly income and expenses might be based on the past and what you expect for the future. Step 2: Insert your income in the projected column with what you expect to earn per month. Now put in your fixed expenses. Some fixed expenses are regular but do not happen every month. For the projected monthly average we suggest you average out the annual cost by using the first calculator tool on the next tab over. You can see this tab at the bottom of your worksheet window. Go down the rows and put in your variable expenses. Think about what outflows you can expect and put in some numbers, you can always change them later as your budget develops. At this stage you may wish to do the same with your credit card and savings account budgets The next column over is the tracking monthly average and is designed to calculate the balance as you use your Victory Cashflow Budget. It will give you an indication of how accurate your predictions are. Revisit these predictions often and think about the variances. This is the key to pro-active budgeting.
Now you have some numbers in your projected column you can tweak these with the objective of running an average monthly surplus. This is what good budgeting is all about, even if it means adjusting your lifestyle or sourcing extra funding if you can. Remember some variable costs do not happen every month but at some stage they will happen. Let s plan for them. Step 3: Go to the current month column. Working down your list of inflows and outflows insert numbers into this column as you would expect them to happen. You may wish to insert them into future months too as the case may be. For fixed costs it is time to drag the numbers over into other months. Highlight the cell by clicking into it. Mouse over the bottom right corner until your cursor turns to a little + drag the mouse over the rows taking care not to drop down on to another row. If you make a mistake then simply click the undo button in the top left of your screen. Note that you can t drag from the predicted monthly average column, only from the month columns. I made this so you can t overwrite past months and distort your future balances. It is helpful to realise at this point that this is a monthly budget. At Victory Cashflow we think this is the best format for pro-active budgeting as it often lines up with monthly transactions and bank statements. If you are paid weekly or fortnightly, or if expenses are paid in this way, then there are going to be extra transactions in some months. This is because there are only 12 months in the year but there are 26 fortnights and 52 weeks. For example if you are paid fortnightly then there are going to be 2 months in the year where you will be paid 3 times. Check your calendar and workout when this is likely to happen and do the same to your weekly or fortnightly expenses. Insert these numbers into your budget to give a far more accurate indication of your closing account balances. Make the best predictions as you can well into the future. Don t worry about being too precise at this stage. Work as many months into the future as you would like. You will see a row called with the monthly account surplus of deficit which is self explanatory. Don t panic if some months you run an account deficit. This shortfall can be compensated by running surpluses in other months. The
highlighted row below this is the closing account balance which flows on through the worksheet into the future. Now let s make the balances real by inserting your first opening account balance. Including your account balance Knowing what to expect for your account balances, based on your inflows and outflows is very liberating. You can plan and predict and make adjustments to your life in order to keep in the green as much as you can. Step 4: Look for the row that says Opening balance from statement on the current month column. Click delete to remove the follow on formula. Insert your opening balance from your statement here. The spreadsheet will update future months with balances based on your inflow and outflows. Now you are seeing the true benefits of budgeting. These row formulas are not protected as they simply follow on from the last months closing balance. You can overwrite these cells for the purpose of locking the past months out of future balances if you wish. You are advised not to alter any future formulas because your worksheet balances will become corrupted. Changing numbers as you go The Victory Cash Flow Budget is designed to be proactive with your life. It needs to be fed with updated actual data. You have previously put in numbers based on what you think should happen and now you can adjust the numbers as they do happen, if you need to. If you find a variance then simply modify the cell to suit. Think about what may have caused these variances. Your future account balances will be modified at the same time. Always take care that you are working in the right month and don t try and move numbers to a new cell. Simply delete and insert numbers. Step 5: At the end of each month be pro-active and reconcile the ending balance to match your bank statements. You might find it easy to bring your ending account balance in line by adjusting the row that says Actual
adjustments it may need to be a positive or a negative number. The other month s forecasts are now in line with what you expect. You can also easily overwrite the opening balance in the next month but it is good to see what the total variance is between actual transactions and what you have previously forecasted. Don t stress about making your budget an exact replica of your bank statement. If you are a few dollars out then simple make the adjustment to the ending balance and move on. Budgeting is an estimation exercise. The more you work on your budget the more control you will have. Your personal control is something that cannot and should not be automated. How do you learn a skill if a machine is doing everything for you? Using the calculator tools The next worksheet over can be found down the bottom of the excel window. Click on the tab that says Calculator tools Three you will find four of the most widely used financial calculators. The monthly average is useful for working out averages across 12 months of the year based on various transaction periods. Use this for your projected budget. The other three calculators use the more complicated time value of money formulas but they are easy to use. Here you can work out mortgage repayments and money growth based on single and regular amounts. Proper use of these tools will mean you can see how your wealth will grow over time. Please remember that no support is offered in the use of this free product. All the best. Andrew Whyte