Food

Clothing

Shelter

Operating Expenses Higher Life Personal Expenses

Miscellaneous

Subheads for Accounts Only

Allowances (children)

Automobile

Care of House

Outside

Flowers

Furnishings, permanent

Furnishings, not permanent

Inside Clothing-Accessories

Coats and Wraps

Gowns

Hats

Jewelry

Repair

Shoes

Underwear Debts

Interest Education Entertainment

Express, Freight, Parcel-Post Food

Bread

Dairy Products

Dry Groceries

Food Outside Home

Fruit

Ice

Meat, Fish, Poultry

Vegetable Garden

Vegetables

Garbage Disposal Fuel

Gifts (Church, charity, civic) Gifts (Personal) Health Insurance Laundry Light Lost 1 Luxuries 1 Man's Expenditure Postage (Letter)

Professional or Business Obligations Reading Recreation Rent Savings Service Stationery Taxes

1 For accounts only.

Telephone, Telegram

Toilet

Transportation - Carfare

Transportation - Other than Carfare

Vacation 2

Budget and Summary Income

2 Perhaps for accounts only.

With such a list where is the difficulty of classification? The dentist's bill goes under Health, the new side-board under Care of House-Furnishings, the railway trip under Transportation-other than Carfare. There is no Miscellaneous, Sundries, or any other catch-all to trap the unwary. The family or individual who does not need all these headings ignores those that are unnecessary, and as said before, some families may need a new heading or two. But few are the families who cannot find within this list good headings for all their expenditure. There may, indeed, be some discussion of an individual item. One person, for example, charges a trunk or a traveling bag to Clothing-Accessories, because either is used to carry clothing chiefly, while another prefers the heading Transportation, because either is used only for traveling. But such differences are negligible, so long as the individual is consistent. And consistency is easy in the account keeping recommended here, because it takes but a moment to look back to see what one decided the last time such an expense was recorded.

In the first budget session, after the income is clearly noted comes consideration of this list of headings. As is stated at the head of the list, the subheads are intended for Accounts only, and the main headings alone need be considered in the budget.

Before considering them, it is helpful to decide to learn to think in percentages, both in budgeting and in spending. Eleven cents a pound for string beans is "only a penny more" than 10 cents, but it is 10% more, which is worth considering. Ten per cent of the total food cost for the year is a tidy little sum. Perhaps the beans at 11 cents are worth more, perhaps the use of the shopper's time and energy is better if 11 cents is paid, but the real money difference should be recognized. If the rent is $50, the change to $60 may perhaps be met without difficulty. It is only $10 a month more - but it is also 20%. The habit is one easy to acquire, one indispensable to the business man, and of almost equal value in the business side of the household. .

Before beginning to consider items, write on a large sheet the headings the family need, arranging the sheet so that the figures will be in columns, easy to add. Read over Chapters IV and V, which call attention to points worth considering under the different heads. The problem is after all not so difficult a one as first thought suggested. In an ordinary family the main expenditures are pretty accurately known. If a vague kind of budgeting did not control family expenditures, the family would be in debt constantly. Father and Mother know about what they can afford for rent. To be sure, they may decide after careful study of the family's whole expenditure that they are spending more than they can afford so that they can change to advantage, even with the expense of moving counted in. But they begin with Rent - or its equivalent in costs for an owned house - and go on naturally to Food. Here many a family begins at once to doubt the need for an expenditure like that of the past. "Our food costs at least $20 a week. I wonder if we couldn't get it down to $19 or even $18.50? That would be $52 or $78 to use somewhere else." But the decision should not take long.

Clothing is the next large expenditure, and probably the one that admits of the most variation in the ordinary family. A fairly generous allowance - what the family ought to be able reasonably to have, with its income and circumstances - should be allowed at first. Alas! in most cases it will have to be cut down later, in the interest of some other need or demand.

Having provided for the elementary needs for the family, decide on Savings. Without being dogmatic, one can advise any normal family living on an earned income that it is running into danger if it spends more than 25% of its income for rent, spends more than 20% for clothing, or saves (of an earned income) less than 10%. At this point of the budget making, check up to be sure that you are within these limits, and if you are not, see if readjustment cannot be made before going further.

Select next the items that are not easily controlled, if at all. Insurance, for example, cannot be changed in amount without changing the amount of security gained by it. The income tax must be paid in full. If one has a telephone in the house, there is a minimum set automatically, and only the overtime or long-distance calls can be controlled. It does not take long to decide what the usual expenditure for the telephone is, and if later the budget must be pared here and there, perhaps the minimum can be changed. The difference between a single wire and a party, wire looks larger on the budget than it does on the monthly bill. Other items that are easily settled may be chosen in order, leaving those in which the margin is wider for later decision. Reference may he made to the notes of Chapters IV and V, which have been read over once already. It is easier to make all items in dollars, ignoring cents.