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Calculating Your Bare Bones Budget: Why You Need to & How to Do It


Calculating Your Bare Bones Budget: Why You Need to & How to Do It | Budgeting in an Emergency | Cut Your Expenses | Pin now and save for later!Do you know how much money you need to live? Like, right now, could you tell me the amount?

No, I don’t want you to actually tell me, but I want you to know your number.

How much do you need to live without including any extras? What is your bare bones budget?

Of course, I think everyone needs to have a budget and track their expenses (take a look at our budget and spending tracker spreadsheet here). But your regular budget most likely includes all kinds of things that aren’t completely necessary, which is totally fine! As long as you can afford those extra things and your expenses are lower than your income it’s no big deal.

I assumed that our $1500 a month budget was about as “bare bones” as we could get. Over the summer when I quit my job and we basically didn’t have any income coming in for a few months, I cut back and cut back until we were spending more like $1200 per month (read about our unemployed budget here).

There is value in knowing your bare bones budget amount though. First let me tell you why it’s important to know and then we’ll get into how to figure it out.

2 Reasons Why You Need to Know Your Bare Bones Budget

1. In Case of Crisis

If you lost your job and had to live off of unemployment would you be freaking out or would it be ok? Obviously, there is a ton of stress when you encounter crisis situations like that, but there is a lot less stress if you know that you can pay your bills and your basic needs will still be met.

One of the biggest reasons that I’m so passionate about being in control of your money and being on top of your budget is because it can take so much stress out of stressful situations.

You also need to know your bare bones budget amount so that you can create a good emergency fund. It’s good to have at least three months of expenses saved up in an emergency fund.

Now if you get sick and are off of work for a few months, you’re going to cut out all of the extras from your budget and live as cheaply as possible. Your emergency fund will last you for at least three months, maybe more if you can really cut back.

2. To Open Your Eyes

Another big reason to calculate your bare bones budget today is to open your eyes to what you’re spending your money on.

Maybe money seems super tight each month and you’re hardly making it. If you figure out the things that you absolutely must spend money on to survive, you might realize that a huge amount of your spending isn’t 100% necessary.

Now we all spend money based on our priorities, whether it’s healthy living (gym memberships, organic foods, workout clothes), travel and entertainment (gas, hotels, concert and movie tickets), or kids activities (sports fees, equipment, travel).

There’s nothing wrong with those things, but if there’s an emergency, you’ll realize very quickly that those things aren’t necessary for survival. When it comes to paying your mortgage or paying for your gym membership, you’ll know what’s important.

When you calculate your bare bones budget, you’ll see how much you’re spending on extras and it might open your eyes to areas where you could cut back.

Related Posts: 

The 5 Biggest Ways We Save Big Money

17 Expenses You’re Forgetting to Budget For

How to Calculate Your Bare Bones Budget

It’s not too hard to calculate and write up your bare bones budget if you’re already familiar with what you spend each month and have a normal monthly budget to go off of.

It’s most important to be able to pay for housing, utilities, food, and transportation. However, there may be ways to cut back on some of those. You can lower utility bills by being more mindful and changing the temperature you keep your house at. You can trim your food budget by cutting out convenience foods and going for inexpensive, but filling and nutritious items like chicken, beans, and pasta. You can lower your transportation costs by driving less, carpooling, and shopping around for cheaper insurance.

Over the summer when we were on a bare bones budget, we cut out all allowance/fun money. We didn’t spend money going out to eat or on entertainment. We stopped saving money each month for Christmas and other things.

You can see the full details of our bare bones unemployed budget here. 

If possible, you should include the minimum payments for any debt in your bare bones budget. If you won’t be able to pay your rent and the debt payment, then you might not be able to pay you minimums, but if at all possible it’s best stay current on all debts or you’ll have a mess later.

When we didn’t have any income coming in for a few months over the summer, I was glad to know how much money we needed to live off of. I knew that we could stretch our emergency fund to last for many months if we had to, which gave us great peace of mind.

Related Posts:

How & Where to Cut Your Budget 

13 Ways to NOT Spend Money

⇒ Do you know how much money you need to live on? Have you had to live on a bare bones budget recently like we did?


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Friday 28th of October 2016

Super interesting !


Friday 28th of October 2016

Thanks Gina!

Kim @ TheEntrepremomer

Friday 28th of October 2016

I remember having to do a bare bones budget as a college student who also worked full time. I lived with my now husband and we were SO broke! I still keep a detailed budget, but I am so glad that we haven't had to do bare bones in a long time!


Friday 28th of October 2016

It's so good to remember those times and see how far you've come! Even when things are tight right now, they're still nowhere near as tight as when we first for married.

Bridget @ Antics of a Nutty Hiker

Friday 28th of October 2016

We do a $0 balanced budget every month and I think budgets are so incredibly important! I have also done what you are calling a bare bones one as we get ready for retirement here in about 2 years just to see if we could live off strictly his retirement pay. We definitely spend a lot on extras!


Friday 28th of October 2016

That's awesome Bridget! It sounds like you guys are doing an amazing job!