How To Create a Budget That Actually Works

Picture yourself on the beach. If you're like most people, you've got a smile on your face because you can't think of any other place you'd rather be—especially in November! Now, think about your finances. Where'd your smile go? Not a fan of cutting back to save money and worrying about paying your bills? Get ready to love your budget as much as you love the beach!

Budgeting often sounds like a chore you’d rather avoid than something you get to do. But, the only way to take charge of your money is to know where it comes from and where it’s going. If you like the idea of a budget but have never been able to stick to one, consider changing the way you approach money management to stay on track.

Here are five tips to get you on your way:

1. Identify roadblocks—Before you can begin to love your budget, you need to understand why it hasn’t worked in the past. Are you a big shopper? Someone who is constantly treating your friends? Trying to keep up with someone else’s spending habits? Or maybe you’re just overextended on your financial commitments.

   Take some time to reflect on what’s happening in your life and try healthier ways to deal with what’s at the root. A morning run to alleviate stress during the day or a low- or no-expense activity with your friends (like hiking!) may be a great way to reset your mindset.

2. Start with small steps—A budget is only as strong as it's weakest link. You don't succeed at saving money just by telling yourself to spend less. It takes a solid plan of action, complete with small, attainable steps that will lead to your ultimate goal.

   Then take an inventory of all your spending. Be honest with yourself and don’t omit anything. It’s important to know where you are right now. A simple way to begin is to divide your spending into four buckets: fixed costs, financial goals, non-monthly expenses and flexible spending. This makes it easier to see where you can cut costs.

   Don’t try to do it all at once! Make one cut and live with it for a while. If you feel good about that, make another cut and see how that feels.

3. Leave room for some fun—Successful budgeting doesn’t mean sacrificing all things good and fun. Planning for a monthly massage or occasional night out is perfectly fine, as long as it doesn’t put you in danger of not making all your necessary expenses.

4. Make it a habit—Creating and implementing a budget is not the end of the process. If you want to stay on track, check in on your progress regularly—once a week should do it. Not only does this make you more familiar with where your money is going, it’s also a great way to spot fraudulent activity or automatic payments for items you no longer need or want. That means fewer headaches for you.

   Watching your budget work also helps you to notice the small victories, like seeing your savings account balance grow or going a full month without overdraft fees. It’s important to celebrate those small wins along the path to your end goal. Reward yourself with a latte or a movie in an actual theater instead of at home.

5. Get a budget buddy—If you need a little extra motivation and support, join forces with a like-minded friend. Cheer each other on, celebrate milestones and support each other when commitment wavers. A little accountability goes a long way!

With these tips, there’s no reason not to be successful in developing a plan for your money and sticking to it. Your wallet and future self will thank you!