How to Budget: Secret Tips for Sticking to Your Budget for Good!

Published on January 16, 2023 by Lauren

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  • Are you wondering how to budget? Are you feeling like you are always trying to play catch-up with last month’s expenses? For so many years, I didn’t budget. I was scared to… and honestly, it was because I didn’t know how to do it. I tried several times, and each time I totally sucked at budgeting.

    Keep reading as I show you how to budget and actually stick to it this time.


    how to budget


    I hit rock bottom one day….

    But I gotta tell ya, hitting rock bottom has some benefits. Because I had no other choice, I HAD TO make my budget work. So I finally figured out these four simple rules and learned how to budget better.

    How to Budget:

    1. Except for emergencies, Do NOT spend more than you take in.
    2. Every month is different, so treat each month differently.
    3. PLAN each month before that month even begins.
    4. Read on for this one later…

    Number 3 was perhaps the most significant change to my budgeting success. In fact, rule #3 is what has allowed me to achieve success in rules #1 and #2.

    It was difficult and daunting at first. I remember wondering, “How can I predict what next month’s expenses are going to look like?” I was also wondering how to budget with no money?

    I did go back and look at my previous 3 month’s bank statements to see how much I had been spending, but since my past spending habits were precisely what I wanted to change, I didn’t dwell too much on the past. To be honest, it was depressing.  But I had to do it anyway. It provides a good baseline, and from there, you can make cuts.

    I don’t think that you need to go crazy categorizing every single little expense down to the penny. The fact is, you decided to start budgeting because you already know that your money has been going to the wrong places. You are ready for a change. And you should spend the bulk of your time with some perspective planning, rather than retrospective discovery.

    When I began this process, I already knew that I was spending WAY too much going out to eat. Did it matter that I had been spending $300 a month or $250 a month? To me, not really.

    There are a few expenses in your spending history that you should really have a good idea of such as food, gas, and bills. These are purchases that you’ve been making and will continue to make. You likely can’t make a huge immediate change in these expenses, so your past history is a good starting point.

    Much to my surprise, after spending about an hour thinking about my finances and everything coming up in the following month, I came up with a pretty good estimate of what that month would look like. Many things are already “set in stone,” like bills, housing, etc. Most of my thoughts centered around things like:

    • When are my paychecks deposited?
    • How many birthdays do I have to buy presents for this month (I have LOTS of nieces, nephews, brothers, sisters, etc.)
    • Do I need to change the oil in my car, or get it inspected?
    • Are there any medical bills due?

    Once I felt pretty good about my plan, I THEN went back and perused the past 2 months of online spending. This was only to look for things we might have missed like a Netflix subscription, app-store purchases… those expenses that might be automated and could easily slip through the cracks.

    Now for that rule #4… and this only applies to married folk – DECIDE YOUR BUDGET TOGETHER. When you agree to a budget, you are effectively agreeing on how you plan to live your lives together – things you value as a family, what is important and what is not important. There will be gives and takes, but do not end your “budget meeting” until you have your pact – next month’s budget.

    how to budget

    Oh, and NEVER stop doing it. Years after our very first ‘budget night,’ it is every bit as important as it was back then. Every month, yes EVERY month, we sit down together for our budget night. So what does our budget night look like? I’ll try my best to break down our philosophy into steps.

    But before I get to these steps, a moment of honesty. Your first couple of months of budgeting will probably suck. You will forget things, you will go way over budget in some categories because you were probably overly optimistic. It’s ok. It will take a few tries to get this process down. Just start and decide to stick with it!

    So here we go….Let’s start learning!

    How to Budget Better:

    1. Know what your income is

    If you’re self-employed, estimate the best you can. Depending on how much cash you have available in your checking account, you will want to know when those paychecks will go in there.  You may be wondering how to budget when you don’t make enough money. The answer is – increase your income and pick up some side hustles.

    2. Give off the top

    Whether it be to your local church or a charity, remember that you are deciding your values as a family. Being generous is something that we should all strive to be. No matter how unfortunate your financial situation is, there is always someone else in greater need.

    3. Plan expenses that you cannot readily change.

    Things like rent/mortgage, utilities, insurance, car payment, etc.

    4. Long-term goals

    Your budget should always have long-term goals mixed in with your short-term cash flow planning. Are you saving for an emergency fund? Getting out of debt or saving for retirement? These are all goals that you should be making monthly progress on and learning how to budget and save money is crucial.

    5. Large one-time or annual expenses

    These are those large expenses that you should be saving for on a monthly basis. For me, I have a Christmas fund; and money is pulled directly out of my account. A great way to save for these items is through Betterment; their services make it SO easy to save for anything, from retirement to a vacation.

    6. Talk about the coming month

    This is your attempt to minimize unplanned expenses. Most of the time, I find that unforeseen costs can be caught and planned for ahead of time when I sit down and spend time thinking about it. What is unique about this month that will cause this month’s budget to be more or less expensive?

    • Birthdays
    • Holiday meals
    • Trips to visit family/friends
    • Work that needs to be done on vehicles

    7. Budget for expenses that you do have some control over

    Here is where the bulk of the discussion during the budget night takes place – the art of how to budget money without sacrificing your life. How much will you spend on food? How much will you spend on clothing? What about all those other little expenses? For these types of expenses, I STRONGLY recommend using cash. Green, physical paper money. I cannot tell you how helpful it has been for us to use cash. For us, we simply spend less money, and have fewer arguments, and it just makes our lives so much easier. Here are the categories that we use cash for:

    • Groceries
    • Gifts (sometimes not… depends on deals that can be found online)
    • Fun – dates & family fun
    • Babysitter (they usually don’t take debit cards)
    • Miscellaneous expenses

    If you absolutely need a card for these categories (and I promise, cash is easier!), I recommend learning more about how to budget your life with a prepaid debit card.

    8. Stick to it!

    At least weekly (daily is recommended), make sure to log into your account online and check to make sure that things are progressing as expected. If your month is off, you might need to make adjustments. Any adjustments are better made sooner rather than later as mistakes have a way of compounding.

    As a spender, this is the hardest one for me. This is the step that requires real self-control. If all of our miscellaneous money has been spent, and I want to buy a bottle of wine… too bad. But that’s a good thing. If you view your budget as constraining, you will fail. If you view your budget as your path toward freedom, you will succeed.

    My book, The Recovering Spender, discussed how I accomplished this mind shift, and how it changed my family’s financial future.

    9. Unplanned expenses

    Being unable to account for unplanned expenses was one of the reasons that I never thought budgeting could work for me. Something ALWAYS comes up, right? Whether the car breaks down, you get an unexpected medical bill, one of your kids takes a trip to the emergency room, etc. Things happen outside of your control, and many of these things cost you lots of money.

    So how do you plan for these? You don’t. But because you have control and a plan for where your money is going, you can revisit your budget to figure out the best way to absorb the cost. These unplanned expenses are the primary reason why I recommend saving for an emergency fund. I cannot imagine the thought of dealing with an unplanned expense while not budgeting.

    Here is a question that often comes up – how often does your spending go exactly as planned?

    Answer – not often. I usually get close, but it seems as though there’s always something I either overlooked; usually it is small. Usually, it is a parking ticket. Or two parking tickets (our street has alternating parking, and we have a wonderful ticketing police officer who REALLY loves her job).

    how to budget

    So if I miss our budget target consistently, why do we go through this exercise? Because long-term, I will NOT miss.

    According to NASA, the difference between weather and climate is a measure of time. Weather is what conditions of the atmosphere are over a short period of time, and climate is how the atmosphere “behaves” over relatively long periods of time.

    Weather is erratic – there are a billion weatherman jokes for a reason – despite all of the state-of-the-art weather technology and years of schooling, the accuracy of weather forecasts can only be so good. Ask a weatherman to predict the temperature 3 weeks out. He could easily be 20-30 degrees off and forget trying to predict precipitation that far out. But climate is the average of all of those anomalies, and it is not erratic.

    The same applies to budgeting. I can’t predict what will happen in the short term, but just by planning, talking, and acting in the short term, our long-term trajectory is not erratic.

    Here are more posts about setting a budget:

    When you ask the question, “What are tips on how to budget your money?”  you will get vastly different answers from many different people. Truth be told, there will always be information on how to budget better. I have simply shared what I do, and it has worked very well for me.

    Just start. As long as you decide to stick with it, you will do awesome!


  • Thankful for each instruction and examples understanding scriptures Some of which I read often, sometimes daily. I was young and now I am old, retired, no savings. Where and what will help me now?

    During season of pandemic, only contribute to St Jude, one children’s home and my senior out reach ministry.

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