Basics of Budgeting

Updated on April 22, 2020
Stephanie-Lynn4 profile image

Stephanie is a business marketing professional with a passion for personal finance.

Budgeting or a Root Canal–Which One Is Worse?

Whether it's just you, or you have others who rely on you financially, budgeting is a great way to set yourself up for financial success.
Whether it's just you, or you have others who rely on you financially, budgeting is a great way to set yourself up for financial success. | Source

As an adult, I've noticed that budgeting is one of those things that comes up in conversations the same way that going to the dentist does. Yeah, you know you haven't been in a while and that you should really check in to make sure everything is going okay, but the second you do, you're hit with the anxiety that recognizing a problem makes it real.

As humans, our first instinct isn't to save. We make money so we can live the lifestyle we want and feel we deserve, and sometimes that means ignoring the possible pitfalls of the future. Are you saving for retirement? Do you ever want to buy a home? Are you planning on having children one day? If you answered yes to any of these questions, you should at least be thinking about budgeting in the back of your mind. And while I know that it's daunting, getting started doesn't have to feel like going in for a root canal! Below I have three simple steps to taking stock of your finances, and a few ways to actually stick to the budget you place for yourself!

Getting Your Finances in Order


So here's the hard part. You have to take a long hard look at where you're spending your money each month.

I know this can be embarrassing or terrifying and just this step can totally turn people off from budgeting in the first place, but it's important to remember that you're only human! As humans we all have a vice, maybe it's a $5 latte every day or a few $10 cocktails every Friday night. No matter what it is, the first thing you should know is that I WILL NOT ask you to stop doing that thing that you enjoy so much. Budgeting isn't about punishing yourself or abstaining, it's about moderation. So without further ado, here are my three steps to starting your budget journey:

1. Print out your credit card, debit card, and checking account statements for the last three months.

This is a hard step because it requires you to take a good, hard look at what you've been spending your hard-earned cash on, down to the cent. While this may be a painful trip down memory lane, it's so important to see on paper just how much you're spending every single day so you can know where you need to make adjustments.

2. Take all of your spending info and sort it into categories, then assign each category its total dollar amount.

Some common categories I use are rent, bills, groceries, dinners or drinks out, entertainment, and shopping for reference. Once you break your spending into these categories you can get a sense of not only where you're spending the most, but how important each category is to you. Rent and bills will always be around the same, barring unforeseen expenses, so those are the easiest part of your budget. But it's the other categories that can be really telling about how and why you spend your money. Do you "treat yourself" to a shopping spree anytime something good or bad happens? Do you go out to dinner or get take-out almost every night. A lot of the time we make these spending decisions out of a place of emotion or laziness, and luckily they have fairly simple solutions, which I'll discuss later on. What's important about this step is getting real about where you spend the most, and more importantly where you can reasonably cut back.

3. Be realistic when writing out your budget.

If you're currently spending $200 a month on coffee you can't give yourself $50 a month and not expect to go over your limit. That's a one-way trip to disappointment and self-loathing. Instead, start by trying to get it down to $150. It will be a much more realistic goal and means that you are more likely to keep your savings promises to yourself.

How to Stick to Your Budget Long Term

Just think of all those new zeros in your bank account! What are your long term financial goals?
Just think of all those new zeros in your bank account! What are your long term financial goals? | Source

For those of us who love instant-gratification, writing your budget already feels like a huge accomplishment, so who cares if you actually stick with it? News flash, if you don't stick to your budget you don't actually save any extra money for your long-term goals! Here are three ways that you can fight the urge to cheat on your budgetary promises:

1. Name your savings accounts after the actual thing you're saving for

Whether it's a new car, a house, or a super luxurious vacation we're all saving our money for a purpose! So why not remind yourself of that thing every step of the way? Online banking platforms will often let you give nicknames to your accounts, so name them after the exact things that the money will be going towards! That way, every time you're tempted to transfer money out you'll have to face the fact that you're just robbing yourself of achieving your goals faster and you'll be far less likely to dip into your savings.

2. Accept that you're human, but don't give up

So you didn't stick to your budget in every single category, so what? Even financial experts don't follow their own advice down to the letter. We're only human, and we can't see the future so every month it stands to reason that you'll be a little over or a little under in at least one category, and that's fine! What you don't want to do is see that you didn't meet your goals and give up on budgeting completely. Maybe you wanted to save $200 this month, but you were only able to achieve $130, don't just fall back on your old spending habits! Just accept that you're human and you'll never be 100% perfect at anything you do. You still save $130 and that's still a win because it's $130 you would have spent otherwise!

3. Nothing is quite as effective as a reward system

When I started budgeting, one of the first things I had to kick to the curb was my coffee shop addiction. I was picking up $5 or $6 coffee drinks a few times a week, sometimes even every single day, and when I took a good hard look at my credit card statements I realized I definitely had a problem. Now, I'm an all or nothing type of person who prides herself on having a lot of will-power and I quit cold-turkey. I became a home-brewed coffee convert, and I honestly didn't miss my daily lattes all that much. As long as I had my caffeine in one way or another, I was happy. But when I decided to quit my coffee shop ways, I made a deal with myself that made the switch a whole lot more enticing.

I promised myself that I would still get an iced coffee or latte one day a month because abstaining from something you love just for the sake of saving can get a little depressing over time. You have to give yourself little treats here and there to ensure you don't end up going on a crazy bender one day. Money, just like the best things in life, is all about moderation. You don't have to starve to lose weight, you just have to eat less of the fatty delicious things and more of the things that are good for you, and working on your financial health works the same way!

Let me know in the comments below what your financial goals are!

This article is accurate and true to the best of the author’s knowledge. Content is for informational or entertainment purposes only and does not substitute for personal counsel or professional advice in business, financial, legal, or technical matters.

© 2018 Stephanie Lynn


    0 of 8192 characters used
    Post Comment
    • profile image

      Nasim Uddin Parve 

      21 months ago

      all the best

    • ObiefunAugustine profile image


      22 months ago

      I will really love to learn from you


    This website uses cookies

    As a user in the EEA, your approval is needed on a few things. To provide a better website experience, uses cookies (and other similar technologies) and may collect, process, and share personal data. Please choose which areas of our service you consent to our doing so.

    For more information on managing or withdrawing consents and how we handle data, visit our Privacy Policy at:

    Show Details
    HubPages Device IDThis is used to identify particular browsers or devices when the access the service, and is used for security reasons.
    LoginThis is necessary to sign in to the HubPages Service.
    Google RecaptchaThis is used to prevent bots and spam. (Privacy Policy)
    AkismetThis is used to detect comment spam. (Privacy Policy)
    HubPages Google AnalyticsThis is used to provide data on traffic to our website, all personally identifyable data is anonymized. (Privacy Policy)
    HubPages Traffic PixelThis is used to collect data on traffic to articles and other pages on our site. Unless you are signed in to a HubPages account, all personally identifiable information is anonymized.
    Amazon Web ServicesThis is a cloud services platform that we used to host our service. (Privacy Policy)
    CloudflareThis is a cloud CDN service that we use to efficiently deliver files required for our service to operate such as javascript, cascading style sheets, images, and videos. (Privacy Policy)
    Google Hosted LibrariesJavascript software libraries such as jQuery are loaded at endpoints on the or domains, for performance and efficiency reasons. (Privacy Policy)
    Google Custom SearchThis is feature allows you to search the site. (Privacy Policy)
    Google MapsSome articles have Google Maps embedded in them. (Privacy Policy)
    Google ChartsThis is used to display charts and graphs on articles and the author center. (Privacy Policy)
    Google AdSense Host APIThis service allows you to sign up for or associate a Google AdSense account with HubPages, so that you can earn money from ads on your articles. No data is shared unless you engage with this feature. (Privacy Policy)
    Google YouTubeSome articles have YouTube videos embedded in them. (Privacy Policy)
    VimeoSome articles have Vimeo videos embedded in them. (Privacy Policy)
    PaypalThis is used for a registered author who enrolls in the HubPages Earnings program and requests to be paid via PayPal. No data is shared with Paypal unless you engage with this feature. (Privacy Policy)
    Facebook LoginYou can use this to streamline signing up for, or signing in to your Hubpages account. No data is shared with Facebook unless you engage with this feature. (Privacy Policy)
    MavenThis supports the Maven widget and search functionality. (Privacy Policy)
    Google AdSenseThis is an ad network. (Privacy Policy)
    Google DoubleClickGoogle provides ad serving technology and runs an ad network. (Privacy Policy)
    Index ExchangeThis is an ad network. (Privacy Policy)
    SovrnThis is an ad network. (Privacy Policy)
    Facebook AdsThis is an ad network. (Privacy Policy)
    Amazon Unified Ad MarketplaceThis is an ad network. (Privacy Policy)
    AppNexusThis is an ad network. (Privacy Policy)
    OpenxThis is an ad network. (Privacy Policy)
    Rubicon ProjectThis is an ad network. (Privacy Policy)
    TripleLiftThis is an ad network. (Privacy Policy)
    Say MediaWe partner with Say Media to deliver ad campaigns on our sites. (Privacy Policy)
    Remarketing PixelsWe may use remarketing pixels from advertising networks such as Google AdWords, Bing Ads, and Facebook in order to advertise the HubPages Service to people that have visited our sites.
    Conversion Tracking PixelsWe may use conversion tracking pixels from advertising networks such as Google AdWords, Bing Ads, and Facebook in order to identify when an advertisement has successfully resulted in the desired action, such as signing up for the HubPages Service or publishing an article on the HubPages Service.
    Author Google AnalyticsThis is used to provide traffic data and reports to the authors of articles on the HubPages Service. (Privacy Policy)
    ComscoreComScore is a media measurement and analytics company providing marketing data and analytics to enterprises, media and advertising agencies, and publishers. Non-consent will result in ComScore only processing obfuscated personal data. (Privacy Policy)
    Amazon Tracking PixelSome articles display amazon products as part of the Amazon Affiliate program, this pixel provides traffic statistics for those products (Privacy Policy)
    ClickscoThis is a data management platform studying reader behavior (Privacy Policy)