Good. You are checking out the budget line by line. It is important that you understand how the budget (“Schedule J” if you want to impress your attorney) is put together. The explanations below are not meant to be complete but are provided to give you an idea of how the process works. Your attorney will spend a great deal of time with you making sure that your budget is realistic and appropriate for you.
Important: All of the items on the budget are monthly amounts. Some things like utilities vary during the year. You need to get a total for the year and divide by 12.
Line 1 – Rent or home mortgage, etc. – this amount is exactly what it says. For a mortgage be sure to indicate the total amount if there are two or more mortgages. Also note that if taxes and insurance are included in your mortgage payment the boxes should be checked. This line also includes lot rent if you have a manufactured home.
Line 2 – Utilities.
a – Electricity and heating fuel – you need to get a total for the entire year and divide by 12. You can get that information from DTE’s website.
b – Water and sewer – these bills are almost always for a two or three month period. Divide by two or three to get a monthly amount.
c – Telephone – hardly anyone has a standalone land line. If you do, include it here. If your land line is included in a cable bundle put it on the next line Other.
d – Other – this is the place to put cell phones, cable/satellite tv and cable/internet/phone bundles.
3. Home maintenance (repairs and upkeep) – this is an item that you were likely neglecting if your budget was tight. For example you might put down $50 – $100 here to replace that old water heater. Have you ever had to call a plumber to unplug a drain? Include something for that. You get the idea.
4. Food – a food budget of $200 – $250 per person is generally acceptable. If you have special dietary needs due to food allergies for example, your budget can be much larger. Do not include amounts spent eating away from home.
5. Clothing – remember that all these numbers are monthly averages. You may spend significant amounts to get school clothes for you children, but only spend it just before school. Average that and any other clothes, shoes, etc., over 12 months.
6. Laundry and dry cleaning – this can easily be $100 per month if you do not have your own washer and dryer.
7. Medical and dental expenses – this category deserves its own page.
8. Transportation (not including car payments) – gas, oil changes, car washes.
9. Recreation, clubs and entertainment, etc. – be reasonable. You can include meals away from home.
10. Charitable contributions – donations you make on a regular basis. Many religious institutions now will provide you with a yearly accounting.
11. Insurance (not deducted from wages or included in home mortgage payments).
a. Homeowner’s or renter’s. (If you rent and don’t have renter’s insurance you should check into it.)
b. Life insurance
d. Auto – your bill is often for six months. Average this number to monthly.
13. Installment payments.
a. Auto – purchase or lease payments
b. Other – such as furniture
14. Alimony, maintenance, and support paid to others – include amounts that should be paid.
15. Payments for support of additional dependents not living at your home – this may include amounts being sent to minor children living somewhere else. You may be able to include amounts sent to children still living in your country of origin.
16. Regular expenses from operation of business, profession, or farm (attach detailed statement)
17. Other – child care is a good example. There are many others.