Budgeting isn’t easy, but it’s the only way to improve your financial standing and, hopefully, your life. The problem is, budgeting takes diligence and effort — two things lazy people tend to avoid.
Don’t worry, we’re not judging you. Instead, we’re offering budgeting improvement tips that require minimal time and effort. Keep reading to learn more.
1. Pay Off Debt Automatically
Do you have debt? Reducing that debt should be a top priority because no one gets ahead squandering their money on interest payments. And while it takes time, it doesn’t have to take much effort on your part. First, decide how you want to go about paying your debt. Do you need to stick to monthly minimum payments? Or are you able to allocate a bit more each month?
Once you decide on how much you can contribute, set up automatic payments. This way, you won’t have to remember to pay. Your debit card will automatically be charged each month, so you can avoid potential late fees.
2. Create a Flexible Budget
For some, budgeting can be a daunting task. After all, going through your finances and assigning a dollar amount to everything isn’t necessarily fun. To improve your spending habits, though, creating a flexible budget is important. (Keyword: flexible.)
A flexible budget is one that changes based on what’s going on in your life. That means it’s ideal for those who don’t have the time to create a detailed budget. For instance, say you need to buy a new computer but didn’t set aside funds for that purpose. You would simply modify your budget by dipping into your grocery money, vacation funds, or wherever you have some wiggle room.
Keep in mind, a flexible budget doesn’t mean you spend money without care. If your overall monthly budget for expenses is $2,000, you should still stay within that number. A flexible budget simply means you have some leeway around how you spend that amount.
3. Start With the Necessary Costs
Not every budget needs to get down into the weeds. While some financial experts will tell you to categorize every dollar, few people want to spend the time doing that. After all, how are you really supposed to know to the penny how much you’ll spend on groceries next week?
A good rule of thumb is to focus your budget on costs that don’t change, such as your mortgage/rent, daycare, insurance, etc. Once you’ve allocated those costs in your budget, don’t categorize your remaining dollars. Instead, leave those funds free to use how you choose.
4. Have an Automatic Savings Plan
According to research, almost 70% of Americans have less than $1,000 in savings. Needless to say, $1,000 won’t get you very far in the event that you lose your job or have a medical emergency. That’s why saving for the unexpected is so important!
One of the best budgeting habits you can adopt is actively putting money away in your savings account. Chances are, you know that. So why don’t you? Remembering to funnel money into your savings every month is difficult — which is why you should implement automatic savings.
With this option, money is automatically taken out of your checking account and moved to a savings account. This is something you can set up with your bank or by downloading an app.
5. Sequester Your Credit Cards
Credit cards can be incredibly beneficial. From improving your credit score to letting you own now and pay later, they have several perks. Getting rid of a credit card account in good standing will probably do you more financial harm than good.
That said, if you don’t have good spending habits, a credit card can bring you grief. So you’ll need to find a way to separate yourself from your plastic. Put it in a place for safe keeping. Keeping your card — while keeping yourself away from it — is your best financial bet.
6. Use a Budgeting Tool
If number crunching isn’t your thing, don’t worry! These days, you don’t have to do the math yourself — you can download an app. Whether you need help creating a budget or you want an easy way to track your spending, there’s an app for that. Here are a few available options:
Mint: This app lets you store all your financial accounts in one place. Mint will create a budget for you and alert you when you go over it. This app will even send reminders when bills are due so you don’t have to remember those dates yourself.
PocketGuard: PocketGuard is a free app similar to Mint. It connects all your accounts and tracks your bills and overall income to create a realistic budget. If you don’t agree with how the app categorizes your funds, you can create your own categorization within the app.
Honeydue: This app is ideal for those in a relationship who want to manage their finances together. Honeydue uses both your and your partner’s financial information to categorize expenses and create limits. The app will send alerts when/if either of you comes close to spending over your limits. Not that you have to bare all. The app allows you to control the level of visibility your partner has into your financial information.
7. Start Small
Being able to stick to a budget is not something that happens overnight. According to research, it can take anywhere from 18 to 254 days to form a new habit. If you think you’re going to wake up one morning with amazing budgeting skills, think again.
Because it might take a while to adopt good financial habits, it’s important to start small. Instead of trying to implement multiple budgeting changes at once, begin with one or two. You’re more likely to stick with them, which will give you the confidence to adopt other beneficial practices over time.
Budgeting can be a challenge for anyone, but especially if you’re on the lazy side. With everything you have going on, you probably don’t want to spend hours figuring out how to improve your finances. Luckily, you don’t have to! These six tips will improve your budgeting habits so you can spend less time worrying about where your money is going.