How To Find The Budget You Can Actually Stick To

In our new series, Investing In Yourself, Chelsea walks you through the basics of getting your money under control so you can reach your long-term goals.

Written by Amanda Holden

The Financial Diet site:

[inea-fijourney]

monthly budgets have been key in ny debt free journey. I started my FI Journey in June 2020 with $82, 145 consumer debt...currently at almost $73k! Gotta love budgets!!

[CaseyBurnsInvesting]

We all have a crux. Mine is food 😅 Not willing to give it up! 😂 Life is meant to be lived!

[joymae]

I just made my budget for October and it feels so good

[ChristopherJohnsonArtist]

I don't have a strict budget because it made me feel like a chore, so I switched to saving a percent of my income and paying myself first and that has worked very well for me and I don't feel like I'm giving anything up because I can spend what is left over after saving. Of course I determined the % based on my normal spending and I record my balances on a monthly basis.

[BbyDAp]

Man, the way I be lying to myself when I try to budget.

[rikidavis]

I told my mom how much I had on my credit cards and she was like, "that's debt." and I was like oh wow, I'm in debt. It's crazy how it sneaks up on you.

[juliegolick]

I rely more on tracking than on traditional budgeting. I know how much my fixed expenses (rent, utilities, savings, gym, etc.) are every month, I have a target I want to hit with my groceries every week, and then pretty much the rest of my money goes into the category of "everything else". This includes everything from toiletries to eating out to clothes to electronics to... everything else. I look at my spending reports very regularly so I'm aware of how much I have left to spend in any given month, and just make sure I don't go above that. It works for me because getting nitty-gritty into line-by-line categories would feel too constrained to me, though I know it works for other people.

[keshavbansal]

Started following this channel a few weeks ago, and what it is essentially doing in my life is motivating me to be more financially aware. Thank you so much guys.

[donnaw]

When my husband and I were first married (sigh, 40 years ago), we used the cash envelope method for about three years. This worked really well for us as two people combining finances for the first time in the days before the internet when bank and credit card statements came once a month. We would also write on the outside of the envelope, the amount withdrawn and what it was for.

[DebtFreeDee]

I once saw a post by a budget channel that said they weren't going to follow a "strict budget" and were somewhat venting about it..😳🤔...and I thought, 'well YOU make your budget...don't make it strict' 😄

Re: a budget actually gives you more freedom: 👏🏾 👏🏾 👏🏾
Great video! Thoroughly enjoyed it!

[babischwanke]

Thank you a lot for this video, Chelsea. I've been "budgeting" (actually I've been tracking my cash flow) for almost five years now. The last year was when I actually graduated and started working and paying things by myself without my parents financial help. And I was building my emergency fund and already looking for retirement accounts contracts and so on. I was actually pretty proud of my self. But then this month for the first time I tried to implement the method of paying myself first and I didn't realize that this month wasn't an ordinary one. I had to pay for my passport renewal, started a French course and a tax that is due every three months was to be paid. So I "paid myself first" and transferred one of my highest savings rate to the emergency fund and my actual account reached negative. 😖 For the first time I made a really stupid money mistake and I was really embarrassed and disappointed for what I have done. This video just made me realize that I'm not ready yet for the pay myself first method. Thank you!

[JazminBautista]

Being grateful for the little purchases goes a long way! Even if it was a mistake.

[thatjillgirl]

Yes, yes, yes. Having a budget is the best. I haven't felt guilt over a purchase in years. I always know whether I have money for something, because I have a budget. It is definitely possible to be so tight on money that your budget is downright depressing, because there is simply no wiggle room for spending beyond the bare necessities. But if you have even the smallest bit of extra money each month, having it allocated to something you *enjoy* in your budget is great and freeing. Maybe that means it's available for you to spend on your favorite hobby. Maybe it means you can put it toward a savings goal of some kind. But whatever it is, knowing that you are free to put that money toward what you want because you've budgeted for it is the best.

I will add that if your income has any kind of fluctuation to it (like I do shift work, so occasionally I have a week where I worked a couple more hours than usual), you should base your monthly budget off of your lowest potential monthly income. That way you're covered in the months when you have lower earnings, and you have excess you can use for savings, investments, or fun stuff in months when you earn more.

[zucchinigreen]

I use One Big Happy Life's One Year Spending plan.

I adjust my budget often and update it regularly.

This month I'm hoping to save more than last month.

That said I did splurge at a beauty supply store after not having gone to one in months.

I'll come back in a month and let you know if it was worth it lol.

[maureentakach]

Chelsea, I've been using the "envelope system" probably since you were in kindergarten. It has worked for me and I'm glad you shared it. When I see the money in the bank on payday and it's not accounted for, it can be difficult to keep certain monies exactly in line with your budget. Kudos for mentioning this system!

[lizza]

I’ve been tracking my spending for almost a year now, fortunately, 2020 didn’t really change much of my finances, I haven’t changed any of my spending habits yet but tracking it diligently over the last year is going to help me build the budget I can stick to as I prepare to buy a house. This channel has been a large part in helping me track and make better choices so far

[rochellesmith]

Checking back in with my budget mid-month has been great for me. I can see where I'm blowing through the budget and can reallocate where needed. It helps me to not feel like I'm scraping by on nothing while also not sacrificing savings goals.

[kmdash]

My credit union has a feature that automatically tells you what your budget is, which drove home the point to me that you either know what your budget is or you don't. Either way, you do have one.

[jacquiz.]

I'd be interested in seeing a COVID-friendly version of the envelope budget. Not enough places are accepting cash (where I live) to make cash envelopes work for me right now.

[emilyanne]

Making a budget to track my spending/income has changed my life. I have so much less financial stress because I know where every cent has gone, and I know to prepare if it looks like I might be in the red the following month.