You know you need a budget, but how about a better budget? Even the most leak proof of financial plans benefit from occasional reevaluation and adjustment if necessary! And if you're just starting out on your budget plan – well, why not make it the best budget that you can imagine? So wherever you are in your financial journey, here are some tips to solidify your budget and help you to rock the way that you track your spending and saving strategies:
- Find your "spirit budget"
I ask people about their spirit animals all. the. time. Working in personal finance, I've also come to apply the same concept to budgeting techniques. Don't be afraid to experiment with several methods to find the "juuuust right" budget for you. If it doesn't look exactly like your neighbor's – no problem! Each person connects with different types of budgeting and benefits from certain strategies. It's just proof that you've personalized your spending plan. -
Track your expenses (all of them)
Of course part of a budget is understanding exactly where you're spending and what you're spending on. It's surprisingly difficult to eyeball your spending. Small purchases easily slip through the cracks and even the monthly bills can fade to the back of your mind. Monitor even the small purchases to get the full financial picture. -
Assign a purpose to your goals
Having a budget is one thing – using it to your financial advantage is another. It's an awesome thing to have a budget that's been created to help you achieve personal or professional goals. What exactly is the reasoning behind your budget? What do you want from the financial balance? These are important questions to ask (and answer). -
Use support groups
Personal finance is, of course, highly personal. But rest assured that we all have to go through the motions and we're all up against similar challenges. Talking with friends or seeking advice from peers can help you to gain insight and learn from outside perspectives. Plus, friends! Nerdy ones, too. Just kidding. Only semi-nerdy. -
Avoid situations that are too tempting
We only have so much willpower, despite our best intentions. To avoid some of those impulse purchases, don't put yourself directly in the line of temptation! If you find yourself crumbling in the face of a strip mall, seek other fulfilling activities for your weekend. Hiking, anyone? -
Give some wiggle room
Nobody's perfect. At least, I hope not, because then I might feel differently about all the mistakes that I've made with my finances. If you set a hard line, you're bound to break it at some point. It's just the reality of life. Add some flexibility to your budget in order to account for these moments. -
Incorporate personalized rewards
Did you rock your budget over the last month? Give yourself some proper congratulations! Have a little area in your budget for small rewards that truly catch your attention and give you a little boost. For me, that's fresh flowers. For you, it might be an epic sandwich at the awesome deli down the street. -
Replace sacrifices with something equally compelling
This is the tough part of creating a successful budget – you'll have to make some spending choices. And likely, they'll include some spending sacrifices. It doesn't necessarily mean giving up your daily coffee (though the latte has gotten tons of flack in the finances world) but it might mean choosing to go out for ice cream instead of going out for the full dining experience. -
Remove stigma from finances
We shoudn't be afraid to talk about financial topics. So say it out loud: Debt. Investing. Retirement. Mortgage. Finance. Now say them louder. By the way, I bet I'd say them louder if we were in a competition. Yes, that's a challenge. And I hope you win, because yelling out "personal finance" as you read my post on public transportation would make my day. Plus, it would further illustrate that it's really not such a bad phrase. -
List your daily wins
Don't focus solely on the things you want to change or the areas that need improvement – give acknowledgement to your daily wins, too! Highlighting the "bright spots" can illuminate strategies that can be optimized in order to magnify success and also it just feels good. High five to yourself. That's why have two hands. -
Utilize visuals
Pictures and images are a great way to incorporate another layer to your budget. When you can see where you're money is going and visualize the impact of spending – you have yet another thing to motivate you and also something that your brain can grasp onto to put something that's often obscure (numbers, spreadsheets) and make it a more relatable. -
Find a parallel goal that works in accordance with your financial goal
Ever notice how when you start to work out more, you tend to put more value on eating healthier? The same goes for the positive impact of financial success parallelling with other aspects of your life. When you feel in control of one area, you recognize that you do have agency and choice in your life and decisions. Harness that and multiply the effect by applying it to another goal, whether that be your career, your health, or your exercise regime. -
Connect with what advice you would give others
Not only are we our own harshest critics, we're also oftentimes our least abided by critic. How often have you told yourself you should do something only to completely ignore your advice? Additionally, how many times have you advised someone else to do something that you know to be beneficial but that you haven't quite taken on yourself yet? I know I've done it. Really dissect the advice that you give to others and prioritize implementing it in your financial plan. -
Make it automatic
Nothing's easier than setting your task ahead of time and then letting automation take over. It frees up your time and also creates an effortless pattern with positive payoff. It's important to check in at intervals, but if you can automate things like your bill payments you simultaneously avoid late charges for forgotten payments, etc. -
Pay yourself first
Allocating your income to your "needs" (think along the lines of taxes, bills, savings, food/rent) as soon as you get your paycheck will give you a clear view of just how much disposable income you have left at the end of the day. This not only helps you to budget for your expenses but also to see what you truly have available to spend on extras each month. Plus, when you pay yourself first, the process is so quick it doesn't give you enough time to bond with that lump of cash. The result is a less anxious parting as you sign your name on the rent check. -
Ask questions
Confused about terms on your bank statement? Ask questions. Not quite sure how your debt payments are being organized? Ask questions. I could keep going but I know you know what my next answer would be: Ask questions. This is a great way to clarify any fuzzy spots and to continue pushing yourself to learn about how you can empower yourself! -
Try out a "zero spending day"
This can teach you a lot about your spending habits. When you cut ALL spending in a single day, the small purchases that may not even register on your mind are all of a sudden highlighted when you can't grab them. It's an excellent way to tap into your habits and hold yourself accountable to each and every penny spent.
Your budget is like your financial roadmap. It'll get you where you need to go but only if you understand it! Don't hesitate to pull over and ask for directions or try a new course if the previous one has been a bit rocky. The time and effort spent connecting with your best route will be well worth the time and effort. And now that I've said that, I promise no more travel comparisons. At least for this post. Now get thee out, budget trekkers! You've totally got this journey under control. (OK, I had a few more.)
Claire Murdough is a personal finance writer for ReadyForZero, a company focused on helping people pay off debt. She is a Bay Area native with an affinity for travel and food who enjoys writing about how to get out of debt and many other topics. You can keep up with her on Twitter @ReadyForZero.
