Your Budgeting Questions Answered!
I receive so many messages on a daily basis from people wanting to learn how to start budgeting, but they don’t know how to take that first step. It is always so amazing to me when I see others who want to improve their life and financial situation. This isn’t an easy thing! It can be scary trying to make such a big change into the unknown. There can be a lot of questions when you first start budgeting and I want to answer some of those for you.
Disclosure: “We are a participant in the Amazon Services LLC Associates Program, an affiliate advertising program designed to provide a means for us to earn fees by linking to Amazon.com and affiliated sites. As an Amazon Associate I earn from qualifying purchases.”
How do I start budgeting?
The very most asked question I receive on Instagram is from people wanting to know how to start budgeting. I think one of the hardest parts of most new habits is starting. It is always hard to take that first big, sometimes scary, step in a new direction. I have three suggestions to help you get on the right track for a successful budget.
1. Make A Zero Based Budget
I recommend making a Zero Based Budget. This is a budget where your expenses and income will be the same, in short…..you give every dollar a job to do within the budget. This does not mean you SPEND every dollar, it means that it has a purpose and place within your budget.
If you are new to budgeting, it might take you a while to figure out just how much money to budget for each category. This is normal! A budget is fluid, meaning it is always changing.
I had about a year of FAILED budgets (no lie) before I finally learned what works for me and my family.
A great resource to get started is my Free Budget Worksheet. Grab it by signing up below!
2. Track All Expenses
Once you make your Zero Based Budget I recommend tracking all of your expenses throughout the month. Yes, this means writing down every.single.thing you spend. Even that $1 pack of gum. Write it down and track it!
Tracking your expenses keeps your budget accurate, and gives you a great window into your spending habits. By tracking your spending habits, you will be able to see what areas you are over spending in and areas you could cut back. This is crucial knowledge!
3. Check Out Dave Ramsey
I highly recommend everyone new to budgeting, frugal living, or paying off debt read the book, The Total Money Makeover by Dave Ramsey. This book changed my life and was the one thing that put me on my path to frugal living and mindful spending.
Check it out from your library, borrow it from a friend, or order it from Amazon. No matter how you get it, just read it. Dave Ramsey uses easy to understand terms as he explains exactly how to fix your financial situation.
What is the best way to keep track of day to day spending?
Ok. So now that we understand it’s important to track spending, let’s talk about exactly how to do that!
Truth is, there are many different ways to track spending. There is no right or wrong way to track spending, the most important thing is that you stay consistent. Here are a few options to try:
1. Excel Spreadsheet
When we first started budgeting my husband put in hours (and hours and hours) making us an excel spreadsheet budget. It was full of details and catered to our spending and needs.
We loved this method. It was free and easy to customize and liked that we could make it exactly how we needed it. However, it was very time consuming to make and upkeep.
2. Budgeting App or Software
After using the excel spreadsheet for a few years we moved on to a computer budgeting program. It was seriously the best decision ever.
We have been using the You Need a Budget budgeting app for about 10 years now and have never looked back. It is so user friendly and very affordable! I love that you can download the app onto your phone and update it as you spend.
A few other great apps available are Every Dollar, Mint, and Pocket Guard.
3. Paper and Pen
There is nothing wrong with tracking expenses with old fashioned paper and pen. As a matter of fact, I know many who prefer budgeting this way.
When tracking spending it is important to stay consistent. Pick a day of the week, schedule a time, and develop a routine for tracking your spending.
How do you use cash envelopes?
Cash envelopes are a great way to limit your spending and stick to your budget. I always recommend them to anyone who consistently is going over budget. Plus they are so easy to use!
Just make your budget, and then get out enough envelopes for your spending categories. Label each envelope, “Clothing”, “Groceries”, etc. Stuff the envelope with enough cash to cover your budgeted amount.
As you go throughout the month, use the cash envelope to purchase items in each category. Once the cash is gone, your spending for the month is done!
How do you make a grocery budget?
First, I want to remind you that grocery budgets will vary greatly! There is no secret amount or right/wrong way to budget for groceries. Food prices vary in different parts of the world, and different families have different needs/diets.
It will take some trial and error to find the right grocery budget for you. A good rule of thumb is $120/person/month. So, a family of four would have a budget of $450/month. However, if you find yourself needing more in your budget that’s OK. Make your budget work for YOU!
How do you save money on groceries?
Groceries are one of the biggest expenses for most budgets. But! I have learned a few ways to ease this burden!
1. Meal Plan
The number one way I have found to keep those costs low is to meal plan. Plan out every meal you want to eat for the week. As you meal plan, write out your grocery list, and stick to this list while you shop. Having a plan reduces the temptation to impulse shop and eat out.
2. Walmart Grocery Pickup
Another fantastic way to stick to your grocery budget is to use Walmart Grocery Pickup. It is completely FREE and you get to shop at home (in your PJs!) and then pick your groceries up at the store. You don’t even have to get out of your car!!
The thing about Walmart Grocery Pickup is that you are able to watch your cart total on the app as you shop. If you find you are spending more than your budgeted amount, just delete a few items from the cart! So easy! So helpful!
What are the easiest cashback apps for frugal beginners?
I’m always getting asked about the best cash back apps. And, I love answering this question because cash back apps are one of my favorite things ever!! I mean you get paid to buy things you would be buying anyways! It just doesn’t get much better than that!
Here are a few of my favorite:
Ibotta is the cashback app I have been using the longest. It’s easy, straightforward and always has a few rebates available! Sign up using this link for up to a $20 sign up bonus! Whoo!
2. Fetch Rewards
The easiest cashback app ever is Fetch Rewards. Fetch Rewards takes less than a minute to use, and rewards you with points for every receipt. These points can be redeemed for gift cards to your favorite places (Target and Amazon!!). Try it for yourself here and use code FETCH2K to get 2,000 bonus points!
Another very easy app to use is Rakuten. Rakuten gives you cashback when you shop online at participating retailers. I never buy anything online without first checking the Rakuten website! Sign up today and get $10 bonus when you spend your first $25!
I share more details about cashback apps here!
What should my budget look like? What is normal for our family?
When you are learning how to budget it’s important to remember that no two budgets look the same, and that’s how it’s suppose to be.
My normal will be different than your normal. What I spend on groceries, will be different from what you will spend on groceries, etc. This is one of my favorite parts of a budget. You can customize it and find something that works for you personally!
With that said, I do recommend following Dave Ramseys budget percentages. These aren’t the law, but I do like that it gives me a basic number to shoot for.
What can you do when you cut back, budget and still don’t have enough money?
I loved this question; because it is so relatable and a very real situation for many of us.
My first piece of advice is to keep your head up! You are NOT alone! There are so many dealing with similar struggles. I strongly believe that together, we CAN help each other reach our financial goals. Reach out to facebook groups and instagram accounts that discuss this issue. Surrounding yourself with others in this situation should give you the strength, support and ideas to help get you through it.
When you have done EVERYTHING you can think of and the money is just still NOT adding up, that means it’s time to take more extreme actions. Here are a few ideas to take when you need to be “gazelle intense.”
1. Sell items in your home
Look around your house for items you don’t use very often. Sell these to earn a little extra money. My goal is to always earn about $50 each month just by selling my clutter. It’s possible!
10 Items In Your House You Can Sell Quickly To Make Money
5 Places Online To Sell Your Clutter and Earn Cash).
2. Start a side hustle
Try to find another way to bring in extra money. A side hustle is a job you can do during your free time. Here are a few side hustle ideas you can do at home.
3. Make some sacrifices
Look through your budget one more time and find a few things you could cut out to have more money. Could you stop going out to eat, or maybe you could switch cell companies to lower your phone plan, could you cancel your TV subscriptions or maybe not going to the movie theater?
I know that each of these can and will take a huge sacrifice, but remind yourself that the sacrifice is temporary.
4. Earn more money
Consider asking for a raise from your current employer. If you have been working at the same location for over a year, many employers will consider giving you a raise. It never EVER hurts to ask! Just ask politely and confidently.
If a raise won’t happen you might want to make a job change. Begin searching around for a job that will pay better and still make you happy.
If you are in desperate need of more money and none of the other suggestions will work for you, you might want to look into downgrading in a few areas of your life. This might mean trading in your car for a cheaper model or moving into a more affordable home.
I understand it is NOT easy when the money just ISN’T there. ESPECIALLY when you feel as if you have sacrificed again, and again and again. I get it, I have been there! Keep your head up. Keep trying. I believe in you!
I hope this article answered all of your questions about budgeting and gave you the tools you need to know how to start budgeting! Feel free to reach out if you have any other questions. I’m always happy to help!
Remember that learning to budget takes time, and that’s OK! Don’t give up if you fail the first few times…..keep trying and keep learning.
Pin for future reference: