How to Budget Like a Boss!

Introduction

If you struggle with budgeting this is the place for you! Managing your money is hard when you don’t have an organized system. Spending hours pouring through bills, receipts, and numbers is exhausting and frustrating. But there is a way for you to create a solid money management system, and to make that system run nearly all by itself. 

Keep reading to learn how to master the art of budgeting!

Spending Plans 101

You’d be surprised to know that our budgeting solution is not to use a budget at all! Instead, we’ll implement a spending plan. 

Budgets are known for being inefficient because they are too restrictive and don’t leave room for surprise or even emergency expenses.

A budget is a list of planned expenses with exact terms and amounts, but a spending plan is different. 

You will be breaking your income into little folders or categories. This spending plan is based on the 50-30-20 rule for the money you make after taxes. 

Generally, 50% of your income is for your Needs. 30% is for wants, desires, and fun. And 20% is dedicated to ESI which stands for 

Early debt repayment

Savings

Investing

There are many different ways to break up the 20% for ESI depending on where you are in your financial journey.

For example, if you have an outstanding credit card balance. It may be wise to divide up your ESI in this way.

• 10% - Early debt repayment
• 5% - Savings
• 5% - Investing

If you have your credit card debt under control and you have some savings goals. Consider dividing it this way.

• 5% - Early debt repayment
• 10% - Savings
• 5% - Investing

And if investing is a big priority to you, try dividing it this way.

• 5% - Early debt repayment
• 5% - Savings
• 10% - Investing

Automation

It’s also essential to automate your spending plan as much as possible. That way you don’t have to think about it all the time. 

Automating your spending makes money management much easier, increasing the chances of sticking to your spending plan.

Here are a few ways for you to automate your spending plan

• Autopay - Go through a list of all of your bills and subscriptions and see if there is an Autopay function. That way, the company will withdraw the monthly bill for you. This ensures that you pay all your bills on time without even having to think about it. Some companies even offer discounts on their services when you opt in for Autopay.
• Online bill pay - this is a third-party service usually provided by your bank to automatically pay bills to service providers that don’t currently have an autopay feature. For example, this is good for paying rent or mortgages. Check if your online banking service has this feature.
• Credit Card Payments - For more variant expenses like groceries, pay with your credit card and set up automatic credit card payments. This is also an excellent way to avoid paying late fees on your card.

Remember the goal here is to make money management as easy as possible for yourself. So create a program, automate that program, and let it run on its own. If you found this advice helpful, subscribe for more personal finance content!