Adding Budget Categories

As your life changes, you’ll need to add new categories to your budget. Whether you started a side hustle, adopted a pet, or want to track a new expense, Balance makes it easy to expand your budget categories.

When to Add New Categories

You might need to add categories when:

• Starting a new income source (freelance work, rental income)
• Taking on new expenses (gym membership, pet care, childcare)
• Wanting more detail (splitting “shopping” into “clothing” and “household”)
• Seasonal expenses (holiday shopping, summer activities)
• New financial goals (saving for vacation, down payment)

How to Add a Category

Step 1: Navigate to Manage Budget

1. Open Balance and go to the Budget tab
2. Tap Manage in the top right corner (shown in screenshot)
3. You’ll see all your existing categories

Step 2: Open Add Category

From the Manage Budget page (shown in screenshot above), scroll to the bottom and tap the Add Category button.

Step 3: Add Category Form

The add category form opens (shown in screenshot above). You’ll see options to:

• Choose category type (Income/Expense)
• Enter category name
• Set budget amount
• Select an icon

Step 3: Choose Category Type

At the top, you’ll see a toggle:

• Income - For money coming in
• Expense - For money going out (default)

Tap to select the appropriate type.

Step 4: Name Your Category

1. Tap the Category Name field
2. Enter a clear, descriptive name
3. Keep it short but meaningful

Good Names:

• Groceries
• Car Insurance
• Date Nights
• Emergency Fund
• Freelance Income

Names to Avoid:

• “Stuff” (too vague)
• “Category 1” (not descriptive)
• “Miscellaneous Everything” (too long)

Step 5: Set the Budget Amount

1. Tap the Amount field
2. Enter your monthly budget for this category
3. Use realistic amounts based on your actual or expected spending

Step 6: Select an Icon (Optional)

1. Scroll through available icons
2. Tap one that represents your category
3. This helps visually identify categories in your budget

Step 7: Save

1. Review your category details
2. Tap Save to create the category
3. Tap Save Changes on the main manage page

Your new category is now part of your budget!

Category Types Explained

Income Categories

Income categories should be positive amounts representing money coming in.

Common Income Categories:

• Salary
• Partner’s Salary
• Freelance Income
• Business Income
• Side Hustle
• Investment Income
• Rental Income
• Tax Refund
• Gift Income
• Other Income

Setting Amounts:

For regular income (salary), use your net monthly income (after taxes):

Annual Salary: $72,000
Monthly Gross: $6,000
Taxes/Benefits: -$1,500
Net Monthly: $4,500 ← Use this amount

For irregular income (freelance), use conservative estimates:

Best Month: $3,000
Worst Month: $500
Average: $1,500
Budget Amount: $1,000 ← Use lower estimate

Expense Categories

Expense categories should be positive amounts representing money going out.

Categories by Type:

Fixed Expenses (same amount each month):

• Rent/Mortgage
• Car Payment
• Insurance Premiums
• Loan Payments
• Subscriptions

Variable Expenses (changes each month):

• Groceries
• Gas
• Utilities
• Dining Out
• Entertainment

Irregular Expenses (not every month):

• Car Maintenance
• Medical Expenses
• Gifts
• Clothing
• Home Repairs

Category Naming Conventions

Keep It Consistent

Use a consistent format for similar categories:

Good:

• Your Salary
• Partner’s Salary

Inconsistent:

• Salary (Mine)
• Partner income

Be Specific but Not Too Specific

Too Vague:

• “Food” (includes groceries, dining, coffee?)

Just Right:

• “Groceries”
• “Dining Out”
• “Coffee Shops”

Too Specific:

• “Monday Lunch Chipotle”
• “Starbucks but only the grande size”

Use Couple-Friendly Names

Since you’re budgeting together:

Instead of:

• “My Car”
• “Her Clothes”
• “His Hobby”

Use:

• “Your Car” / “Partner’s Car”
• “Clothing - You” / “Clothing - Partner”
• “Personal Spending - You” / “Personal Spending - Partner”

Setting Initial Budget Amounts

For New Regular Expenses

If you know the exact monthly amount:

• Gym Membership: $50/month → Budget $50
• Streaming Service: $15/month → Budget $15

For New Variable Expenses

If the amount varies, estimate conservatively:

1. Research typical costs
2. Add 10-20% buffer
3. Adjust after first month

Example - New Pet:

Research shows:
- Food: $50-80/month
- Supplies: $20-40/month

Initial Budget:
- Pet Food: $80
- Pet Supplies: $40
Total: $120/month

Adjust after seeing actual spending.

For Annual Expenses

Convert annual costs to monthly:

Car Registration: $120/year
Monthly Budget: $120 ÷ 12 = $10/month

Amazon Prime: $139/year
Monthly Budget: $139 ÷ 12 = $11.58 → $12/month

This way, the money is set aside when the bill comes due.

Icon Selection Best Practices

Icons help you quickly identify categories at a glance.

Icon Tips:

• Choose icons that clearly represent the category
• Use different icons for similar categories
• Be consistent (don’t mix styles)
• Icons are optional - names work fine too

Adjusting Allocation After Adding

When you add a new expense category, your allocation changes.

Before adding Pet Care ($100):

Income: $5,000
Expenses: $4,800
Allocated: 96%
Remaining: $200

After adding Pet Care ($100):

Income: $5,000
Expenses: $4,900
Allocated: 98%
Remaining: $100

If you go over 100%, you need to:

1. Reduce other categories
2. Add income categories
3. Or accept being over (not recommended)

Common Use Cases

Example 1: Starting a Side Hustle

You just started freelancing:

1. Add Income category: “Freelance Design”
2. Set amount: $500 (conservative estimate)
3. Select icon: Briefcase
4. Save
5. Allocate this new income to existing expenses or savings

Example 2: Tracking Pet Expenses

You adopted a dog:

1. Add Expense category: “Pet Care”
2. Set amount: $150
3. Select icon: Paw print
4. Save
5. Reduce other categories by $150 to stay balanced

Or split into detailed categories:

• Pet Food: $80
• Pet Supplies: $30
• Vet Care: $40

Example 3: Saving for Vacation

You want to save for a trip:

1. Add Expense category: “Vacation Fund”
2. Set amount: $300
3. Select icon: Airplane
4. Save
5. This treats savings as an “expense” to budget for

Example 4: Adding Partner’s Income

Your partner just started working:

1. Add Income category: “Partner’s Salary”
2. Set amount: $3,200
3. Select icon: Money
4. Save
5. Create new expense categories or increase existing ones with the extra income

Managing Multiple Categories

Organization Strategies

By Priority:

1. Essential expenses first (rent, utilities)
2. Important expenses middle (groceries, gas)
3. Discretionary expenses last (entertainment)

By Type:

1. All housing costs together
2. All transportation together
3. All food together

By Person:

1. Joint expenses (rent, groceries)
2. Your personal expenses
3. Partner’s personal expenses

How Many Categories?

Too Few (5-8):

• Pro: Simple, easy to track
• Con: Lack of detail, hard to identify problems

Just Right (10-20):

• Pro: Good balance of detail and simplicity
• Con: None really
• Recommended for most couples

Too Many (30+):

• Pro: Extremely detailed
• Con: Overwhelming, time-consuming, hard to maintain

Start Simple: Begin with 10-15 categories. Add more as needed.

Carrying Over Categories

When you add a category, you can enable Carry Over:

What is Carry Over?

If you don’t spend the full budgeted amount, the leftover carries to next month.

Example:

Entertainment budgeted: $200
Entertainment spent: $150
Carried over: $50

Next month:
Entertainment budget: $200
Plus carry over: +$50
Total available: $250

When to Use Carry Over

Good for:

• Variable expenses that fluctuate
• Savings categories (vacation fund, emergency fund)
• Irregular expenses (car maintenance, medical)

Not ideal for:

• Fixed expenses that don’t vary (rent, subscriptions)
• Groceries or gas (better to adjust budget)

How to Enable

When creating category:

1. Look for “Carry Over” toggle
2. Enable it for categories you want to roll over
3. Save

Deleting vs. Deactivating

If you no longer need a category, you can remove it.

From the Manage Budget Page

1. Tap Reorder
2. Each category shows an edit icon
3. Tap the category to edit
4. Change the name or amount, or
5. Delete if no longer needed
6. Tap Save Changes

What Happens to Existing Transactions?

When you delete a category:

• Existing transactions become uncategorized
• You’ll see them in your uncategorized count
• You’ll need to recategorize them
• Historical budget data is preserved

Tip: Instead of deleting, you can set budget to $0 for categories you temporarily don’t need.

Best Practices

1. Add Categories Gradually

Don’t try to create the perfect budget on day one. Start with essential categories and add more as you discover needs.

2. Use Clear, Shared Language

Since you’re budgeting with a partner, use names you both understand:

• “Date Nights” not “Romantic Outings”
• “Groceries” not “Food Shopping”
• “Car” not “The Honda”

3. Review Monthly

At the end of each month:

• Did you use all categories?
• Do you need new ones?
• Are any categories unused?

4. Combine When Possible

If you have:

• Netflix: $15
• Hulu: $12
• Disney+: $8
• Spotify: $10

Consider combining into:

• Streaming Services: $45

5. Budget for Buffer

Consider adding:

• “Miscellaneous” - $100-200 for unexpected small expenses
• “Buffer” - Extra padding for variable categories

Troubleshooting

“I can’t save my new category”

Check that:

• Category name is not empty
• Amount is greater than 0
• You’re not duplicating an existing category name

“My allocation is over 100% now”

After adding an expense category:

1. Reduce amounts in other expense categories
2. Or add an income category to increase total income
3. Or accept going over temporarily and adjust next month

“I don’t see my new category”

Make sure:

• You tapped Save on the category form
• You tapped Save Changes on the manage page
• The app has synced (try pull-to-refresh)

“My partner can’t see the new category”

• Categories sync automatically
• Wait a few seconds and refresh
• Or fully close and reopen the app

Next Steps

Now that you know how to add categories:

1. Editing Categories - Learn to modify and delete categories
2. Setting Category Budgets - Master budget amounts
3. Income Categories - Deep dive on income
4. Expense Categories - Deep dive on expenses

Need help? Contact our support team - we’re here to assist!