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How to Budget as an Adult


I know, I know. This topic sounds thrilling. But as adults, we need a budget to get by. You may say that living with a budget is challenging. You’re dead wrong. Living without a budget is challenging. Having a budget doesn’t restrict you; it empowers you.

Decide what you realistically want from budgeting. Imagine your life five years from now after budgeting. How much will you have saved up? Will you be able to afford that dream vacation? The dream wedding? Can you afford to put money down on a house? Could you have paid off all your debts and still saved for what you want? Could you have started saving early for your child’s college fund? Maybe you have gotten a head start on your retirement fund?

There are plenty of ways you can budget. There are templates on Excel, budget books on Amazon with ideas and PDF files, apps like Mint and You Need a Budget (my personal favorite and the favorite in many budget books!), and probably so much more I don’t know about. You have so many options to budget that you can definitely find something you like! But no matter what you choose, you unquestionably need some sort of budget.

You can also use the tried and true Envelope Budget, which uses all cash, but is a little more complicated in our digital world. You have an envelope for each category and fill it with cash. You can’t go over the amount of money you have in each envelope. This may have been easier in the past when we paid things with checks, but now that we have automatic payments for bills (and you should have automatic payments to prevent late fees) taken out of our debit or credit cards, it doesn’t seem as feasible. Still, you could use this method with categories that aren’t bills, such as groceries, dining out, clothes, etc.

There’s also the popular 50/30/20 approach. You spend 50% on your necessities, 30% on wants, and 20% goes into savings. The only problem with this system nowadays is that often rent and bills cover more than 50% of your paycheck. However, this is a great budget idea, and you can always tailor it to make it your own!

When I talk about budgeting, I’m not talking about simply writing your transactions down after making them. Don’t just track expenses as you go. Instead, I’m talking about giving yourself a set limit in specific categories, tracking what you spend after you set a limit at the beginning of the month, and not going over it. You may not get it right for the first few months, but you eventually will figure out how it works for you, and you’ll get it together. (A simple way to do this is to track yourself for a week and multiply it by four, but you’ll notice all weeks are different.)

The question is not always Can I Afford This? Sometimes the question is Should I Buy This Even Though I Can Afford This? For example, how much money do you spend at Starbucks each week? Can you make coffee at home? Of course, if Starbucks is important to you, include it in your budget! Can you make your lunch at home to take to work? Can you dine out less and cook more? Can you get rid of cable and only use streaming services? You’re the only one who knows what your priorities are — and if Starbucks or dining out are your priorities, then you should absolutely keep them in your budget if you can afford it! Your obligations and priorities will look way different than somebody else’s. We only tend to feel guilt when we’re spending money when we don’t spend it in line with our priorities, or we know we can’t afford what we’re buying. What do you want your money to do for you?

It’s really tempting to start budgeting $50 for dining out when you spent $400 on dining out the month before. You may make it one month, but it’s not sustainable. Habits are changed in small doses. So don’t be afraid to go slowly if you do want to cut down on something you spend a lot of money on.

It’s also essential to save a bit monthly to be ready for unexpected expenses — maybe your car breaks down, or you have a medical emergency. Perhaps you just forgot you’re going to be charged for your Amazon Prime membership! The goal is to have at least one month’s money in advance, preferably more. I’ll be honest — I don’t personally have this yet myself, but I’m working on it. If you need to make more money, there are plenty of things you can do — there are so many side hustles these days that it’s ridiculous. A great place to look is Making Sense of Cents. And if you have debts to pay off, that’s incredibly important, as well as budgeting to spend less money.

There are a few easy ways I save money:

  1. LOVE Amazon. So I just don’t sign on. It’s difficult, but I know I’d buy something, even if it’s something I need.
  2. I’m challenging myself to a no-buy streak for the month. I told myself I could spend money on experiences (seeing friends, etc.) or essential things that I absolutely must buy, but I wouldn’t buy any frivolous items.
  3. I get my groceries delivered, or I pick them up. That way, I don’t find products that I just have to have around the store. Because if I go to the store, I always find so many things that I “need” when I actually don’t need them at all. I end up spending way too much money. Buying online doesn’t give me the chance to browse.

I challenge you to a no-buy streak for the rest of the month. If it’s a necessary product or an experience, that’s okay. But if you don’t need it, don’t buy it!

I also want to recommend You Need a Budget. It’s the absolute best budget I’ve ever used, hands down. They have a 34-day free trial (you don’t have to put in your credit card) to see if you like it before paying for it. I think it’s worth the money. It’s already helped me more than any Excel spreadsheet, Mint, or any paper budget I’ve ever used! (And I’ve used a lot of different types of budgets!) I like YNAB because it helps me avoid impulse purchases. After all, I can just check with my tracker first and see if I can afford it. It also allows me to recognize the things that are the highest priority to me and helps me figure out how to use my money to serve me best. Unfortunately, it does cost money. So even if you decide not to use it, the blog entries are invaluable! You should also check out the blog entries on Nerd Hacker. They’ve also been highly beneficial for me.

How else do you think you can save money by budgeting? Leave a comment below with some suggestions. I’ll include them in my money series this week!

I also want to give a quick shout-out to Adam and Rory, who joined my Patreon… thank you, guys! I appreciate you being so supportive! It means so much to me!!!

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