Build your first budget
Planning a budget took me twenty minutes. Sticking to it took practice. Here’s everything that made it work.
Pick a method that fits you
There’s no single right way to run a budget. Pick the one you’ll actually stick to:
- 50/30/20. Three groups, three numbers. Best if you want something simple.
- Pots or envelopes. Split your money into separate pots, accounts or envelopes of cash for each purpose: rent, food, fun. When a pot is empty, that spending stops for the month. Best if you like to see your money.
- Zero-based. Every unit of income gets a specific job until there’s nothing left without one. Best if you like detail and control.
You can mix them. Plenty of people use 50/30/20 for the big picture and pots for day-to-day spending.
Build it
Build your budget
Use your take-home pay. Nothing you type here is saved or sent anywhere.
Needs
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Wants
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Savings
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Enter your take-home pay to see your budget.
Keep it going
A budget isn’t something you make once. These habits keep it working:
- A weekly money check-in. Ten minutes, once a week: look at what you’ve spent and what’s left in each group.
- Expect to adjust. Your first budget will be wrong somewhere. Fix it next month, without guilt.
- When you overspend, move money, don’t quit. If you overspend on food, take it from wants, not from savings. Then budget more realistically next month.
- Plan for fun. A budget with no fun in it won’t last. Wants are part of the plan.
In month two I blew my food budget completely. Old me would have given up. Instead I moved money across from wants, and budgeted a bit more for food the next month. That was it.
