After writing a post on Tuesday about how to make a budget I thought I would do a follow up post on how to stick to your budget. Budgeting is such an effective tool if used correctly and in a way that suits your needs, but sticking to it may be the hard part.
3 easy ways to stick to a budget:
1) Don’t make it too tight. There are two camps in respects to a budget; those who budget to the penny and those who budget and hope for some left over. I am not a fan of budgeting to the very last penny, just in case there are any unexpected expenses during the month that I’d rather not dip into my emergency fund to cover. I usually try and leave about £100 left in the budget for this. A very rigid budget with no breathing room in it isn’t a fair representation of life; we all have those unexpected expenses crop up from time to time
2) Be realistic. It’s all very well making a budget for every category and then being realistic about what you actually spend. Like I said in the last post, if you don’t know how much you spend on certain aspects, then now is the time to start to monitor! There’s no point in saying “£100 on food for four for a month, we can do that!” when you normally spend £250 as it’s not a realistic aim for your budget. Also, allow for some treats if your budget allows, so that you don’t go mad without anything!
3) Planning. A budget will only work if you plan for things in advance and plan when you’re going to spend. For example, I don’t spend anything during the week so they are NSDs (see more on that here) but I know that I normally spend on a Saturday, so plan most of my spending for that day. Little spends during the week and other unplanned spends add up to a lot during the month whereas if you plan ahead, these can be eliminated.
What do you think; do you agree with me? Any other tips for sticking to a budget? Or do you hate budgeting and don’t do it? I’d love to hear from you!
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Nicola,
I totally agree that these tips will benefit people who are just starting out budgeting their expenses. By far the hardest part is setting realistic goals, like you said.
To me, though, these rules don’t apply. I sort of have a weird way of keeping a budget in that I try to limit all of my necessary expenses combined to a certain amount. Unexpected costs I’ll try to justify by calculating how long the ‘investment’ will last (e.g. when I buy a vacuum cleaner or something). And I always have a certain amount of money dedicated to fun stuff!
Have a great day,
NMW
So you just try and keep everything as low as possible and then save the rest? Not a bad way to use your money either! It’d be interesting to see what your percentages are in terms of spending/saving.
I like to have a zero based budget so I have more restriction in my budget than your proposal. I think your budget gets better and better over time.
Budgeting down to the penny is difficult. I try to have a zero-based budget, but I always have a little cushion in my accounts just in case something doesn’t go as planned.
I agree about not making it too tight or too long term either. Keep it short and light. Baby steps makes keeping to a budget or anything for that matter easier. Thanks for sharing.
I don’t use a budget at all. Heck, I recently posted about my antibudget. They aren’t any fun and my life is constantly changing so I choose to pass on the idea. Some people like it budgeting though and that’s cool.
I can’t imagine not having any kind of budget! I like to know these things 🙂 but good for you, if it doesn’t work for you then there’s no point in trying to make it work.
These are definitely three great ways to ensure a budget can work for you. So many people aren’t realistic with their spending, and get discouraged as a result. It’s important to kind of go easy, especially as you first start out. You can always adjust!
I think the biggest issue I see with client’s setting budgets is that they are not realistic on their spending. I have client’s with spreadsheets telling them what their budget should be and they frequently are no where close to what they are actually spending. Not making it too tight is a great point for people who are just starting to budget. If you are too hard on yourself, you are more likely to give up.
All of those tips are great! I budget, but I allow a little flexibility because otherwise I drive myself crazy!
Yes, I think a bit of flexibility is a must, I don’t know how people do a zero budget where there’s no room for error.
The problem that I have had with my budget is that I never budget in fun money. We are always going over budget because we never set aside enough so that we can actually “live.”