Picture this. You’ve sat down, gone through your finances and set yourself a budget. You feel organised and on top of your money. Hooray. The problem is your budget only works on paper, and not in real life.
The second you step outside, money seems to leak out of your pockets like a drippy tap and, before you know it, your budget is all out of whack. Sound familiar?
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Here are five ways to make your budget easier to stick to.
1. Make it dynamic
If you find that some weeks you’re bang on budget and other weeks you’re reaching for the savings you worked hard to stash, try a more dynamic approach to budgeting. Instead of using the same cookie-cutter rules every single week or month, giving yourself more freedom to spend one week, and cutting back more the next can help balance out your spending and savings efforts and give you more lifestyle freedom.
For example, if your vice is dining out and ordering takeaway, allow yourself more spending money for food and drink 1-2 weeks a month to give yourself the freedom to enjoy what you love. Then, on the other weeks, concentrate your focus on cooking at home.
If you struggle with the monotony of being ‘good’ with your money week in, week out, this strategy can really help.
2. Create distance to remove temptation
Banking apps and fast transfers make it easier than ever to sabotage your budget. If you often find yourself struggling to make progress because you’re always dipping into your savings, creating distance can help. Keep your savings separate from your everyday spending to increase the barriers to accessing them for non-essentials.
3. Build an emotional connection
Studies have shown that when we’re emotionally connected to a financial goal or outcome, we’re more committed to the behaviours that’ll make it happen.
Whether you’re saving up for something or you’re just trying to get a handle on where your money goes, spend some time thinking about your ‘why’. What’s your reason for putting in the effort to stay on top of your finances? Create a vision of your why in your mind, or create something physical like a mini vision board, and practise recalling this vision whenever you’re making a financial decision.
Reminding yourself of your family as your why, for example, can help you make better decisions that get you better outcomes.
4. Automate it
Automating your money once it hits your account on payday can reduce the temptation to deviate from your plan and keep you on track. When your pay hits your account, set up a system that sends money off to cover your expenses and recurring debits, sends funds to your savings pot, and sets aside any other costs you need to account for.
Once your automatic transfers have done their thing, you know you’re left with money that’s truly available to spend without compromising your financial stability.
5. Give yourself more permission
Sometimes budgets fail because we’re not giving ourselves enough room to live our lives. Just like fad diets, strict budgets that cut all fun and enjoyment out of your life are a highway to budget burnout.
If you’re often finding that your budget sounds great on paper but never quite translates into reality, try giving yourself a little extra permission to spend.
Budgets can often be knee-jerk reactions to a financial problem, and we think that we have to do everything perfectly in order to succeed. You really don’t – finding a way to build a reasonable amount of discretionary spending into your budget is often the secret sauce to success.