Can Budget Planning Be Done in Excel?

Can Budget Planning be done in Excel?

Yes. It can be done. It’s not easy, but it is doable.

If you master the basic knowledge to use Excel, you have a reasonable chance to maintain your budget planning in the application long-term without the need for using other tools or spending money on printed budget planners. Even Microsoft states this explicitly here:

Excel can help you get organized and on track with a variety of free and premium budgeting templates.

So you can get started right away, I present you with a Personal Monthly Budget Template for Excel that you can download for free here. The wording is very tricky because it’s only free if you have a Microsoft 365 subscription. If not, you will have to pay $6.99 a month. I don’t really understand why they say it’s free and premium and they ask you to pay immediately after. I am under the impression that “free” is just a marketing strategy. However, I included the paid version here because I think that most people who research if they can do budget planning in Excel probably pay for it.

If you try to use the template and introduce how much you’ve earned and how much you’ve spent, it will automatically calculate the difference. It’s not a big deal but, in other words, it can only help you with calculations. This means that at the end of the month, you’ll know if you’ve spent more than you’ve earned or if you can save something.

In addition to this template, there are plenty of online resources, mostly paid, that offer all kinds of sheet models. But a lot of people are asking for money. However, if you dive deeper, you might also find a few free ones, but my goal now is to make you aware of the problems you will probably encounter along the way so that you don’t waste your time if you don’t consider it worthwhile.

What are the challenges you will face when using a budget planner in Excel?

It’s specific to whoever created it. Just like typical budget planners, if you’re using an Excel template you’ll have to work with the structure and calculations of the person who created it. If we compare it to a typical budget planner that allows you to adjust predefined fields and names pretty easily, with a predefined template it’s going to be a lot harder. You will probably have to adjust calculation formulas as well.
They are pretty hard to personalize. Let’s say that you somehow move past surface customization adjustments. There is still a big chance that you will have to go into even more advanced details. For instance, if the monthly budget is spread over different tabs, and you need a total on the first page. It will be harder if you want to work with percentages and they are not included in the basic formulas. You can stumble upon many issues that you wouldn’t expect, so think very well about what you want specifically and look for a template that can solve most of your needs.
Data safety. This is also a pretty big problem but not for everyone. Just the fact that you have your financial information on your computer can expose you to hackers that you wouldn’t be exposed to if you used a physical budget planner. They both share the risk of being robbed by a thief who breaks into your home and steals your budget planner and your computer. However, only digital information is exposed to hackers, so this is an extra risk you need to be willing to take.
Multiple users / no easy collaboration. Everyone can participate in filling in a physical budget planner, especially when there are unforeseen expenses because it’s much easier to use by people who are not technically inclined. Some family members might find it difficult or impossible to collaborate on a digital budget planner, and you will have to teach them basic Excel features.
It’s harder to do reviews and revisions. With small exceptions, most people find it a lot harder to review their annual activity when flipping through spreadsheets than with a physical budget planner. And reviewing is essential. If you have a clear overview, you can make the adjustments that require the least effort or those that have the greatest impact. Using a budget planner that you don’t review regularly is almost useless. This is by far one of the most important reasons why I would choose a physical budget planner.

If the reasons above are not serious enough to motivate you to look for other solutions, then two active directions remain: using a predefined budget planner or creating one from scratch. Take a look first and see if you can find something on the Internet that matches the features you need the most. If you can’t find anything, the best solution for you is to create a personalized template from scratch. You will come to a conclusion when you test a few and you notice that your personal needs don’t align with those of the majority. If you find yourself in this situation, you will probably need a bit of guidance, which is why I’ve searched for a few guides and a video that can help you step-by-step when creating a budget planner in Excel:

And here is a video created by the Technology for Teachers and Students channel that takes you through the creation process of an Excel family budget step-by-step. They also have an entire playlist of Excel tutorial videos that you can see here: http://bit.ly/tech4excel

And here is a more detailed video that shows you how to create a “personal budget dashboard”. It’s longer and more technical, but it could be useful if you’re willing to put in the effort:

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