Last week I wrote about common budgeting mistakes, as well as some suggestions for better strategies. But success isn’t just about avoiding the biggest pitfalls. It’s also about the daily grind of sticking to your budget, and that’s where a lot of people get into trouble.
If, like I used to, you’re finding it easy to write down a budget at the beginning of the month, and not so easy to actually follow it, try these five tips:
1) Find Your Motivation
There are always going to be times when sticking to your budget is just…not fun. If you’re going to do it anyway, you’re going to need to be motivated, whether that means staying committed to a goal like financial freedom, or envisioning supporting your children through college, or finally taking that dream trip.
My favorite motivation is just to think about how much more secure I feel with money in the bank than I did when I was living paycheck to paycheck…and knowing that I got there mostly through finally learning to budget.
2) Know How Much Money Is In Your Budget
Wait, wait, I know that sounds really obvious. But think about it! How many times have you been out shopping, seen a nice pair of shoes, and had no idea how much money is in your “clothing” budget category?
Some people go old-school with a notebook and pen, but these days a budgeting spreadsheet or app is probably more convenient for most people trying to stick to a budget on the go.
3) Use Cash
Using cash is a great way to tighten up a leaky budget. Some people swear by the cash envelope system for managing a budget. With this system, you take out your month’s spending money in cash, then portion it into labeled envelopes: “groceries,” “gas,” “fun,” etc.
Personally, I find the envelopes themselves clunky. But I do take out a set amount of cash to be used for combined groceries and incidentals during the month, and it has really helped me cut down on unnecessary grocery purchases and on random meals out. I think very carefully before I spend that limited amount of cash because I don’t want to run short the last week or two of the month!
4) Be Realistic About Your Budget
It’s an extreme example, but consider: if you budget $50 for groceries for your family of four, of course you’re going to have trouble sticking to the budget! It is a lot easier to stick to a budget that has a little give in it. You should account for a social life, for home maintenance, and for reasonable transportation, food, and housing costs.
If you’re realistic about the amount you need to spend, you should have better luck not over-spending.
5) Plan Ahead
Similarly, be realistic about your expenses for the whole year. The classic example is Christmas, where people often set aside a little money every month to make a Christmas budget, but there are other yearly expenses, like car registration and vet visits, that you can budget for in advance.
Budgeting like this means that when you have to pay the vet, you don’t have to take the whole fee out of the month’s budget — which it turn makes it easier for you to actually stick to the budget!
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Sticking to a budget will always take more discipline for me than just pulling out my credit card every time I want something. But these techniques have helped me not only survive, but thrive, on a budget.
How about you? Do you find budgeting effortless or do you need help sticking to it sometimes?
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We do pretty well when it comes to sticking to our budget each month. I think it helps that we added a $200 miscellaneous catch-all category.
Oh, the misc category is KEY.
I think motivation is key to sticking to a budget. I don’t have a budget with strict category thresholds, but I tend to keep my spending about the same each month in general. Similar to you, my motivation is financial freedom and the comfort I feel knowing I have a money cushion.
Yeah, it’s so much easier to do better with your money when you know why you’re doing it! Congrats on keeping your spending to about the same amount every month.
Overall, Mrs. Superhero and I do pretty well sticking to our budget. One of the key problems we overcame was overspending on our “blow” money. We solved this by increasing the amount available for each of us in this category. Ironically, following the increase, neither one of us spends close to what is allotted each month.
The envelope system can be clunky, but it has worked for us when we have really had a desire to buckle down, such as when we were living “scorched earth style” to increase our available funds for our new, furniture, moving costs, etc. Today, we do well just tracking our spending electronically.
Great article!
I agree that if you’re consistently overspending, it’s better to accept reality and increase! You can always save anything left over. Glad you’ve found a system that works for you.
Budgeting goes fairly well for us as we’ve been doing it for a number of years. The key, in my opinion, is finding that motivation and what you want your money to do for you. If you don’t have the motivation it’s going to be that much more difficult to stay on top of it.
I think that’s totally true — figuring out what will get you to budget, as opposed to just knowing you “should,” is key.
This was a fantastic post. I struggle with budgets, I’ve began and given up a million times. This makes sense and the tips are very do-able. Thank you!!