How It Works

Budget variance shows the difference between what you planned to spend and what you actually spent. A positive number means you’re under budget; negative means over budget.

Basic Formula

=Budget - Actual

Example

Category	Budget	Actual	Variance
Groceries	$500	$485	$15
Dining Out	$200	$267	-$67
Gas	$150	$142	$8

Groceries Formula: =B2-C2 → $15 (under budget)

Dining Out Formula: =B3-C3 → -$67 (over budget)

Variations

Variance as Percentage

=(Budget - Actual) / Budget * 100

Shows variance as a percentage of the budget:

Groceries: (500-485)/500 = 3% under budget
Dining Out: (200-267)/200 = -33.5% over budget

Absolute Variance

=ABS(Budget - Actual)

Returns the size of the variance regardless of direction - useful for highlighting large deviations.

Conditional Formatting Formula

Use this in conditional formatting to highlight overspending:

=C2>B2

Apply red background when actual exceeds budget.

Pro Tips

Add a status column with: =IF(D2>=0, "On Track", "Over Budget")
Calculate remaining budget: =IF(Budget-Actual>0, Budget-Actual, 0)
Track cumulative variance across categories: =SUM(D:D)

Interpreting Results

Variance	Meaning	Action
Positive	Under budget	Consider reallocating or saving
Zero	Exactly on budget	Perfect planning
Negative	Over budget	Review spending, adjust future budget