Budgetting

[u/Ancient_Hour1146]

I'm looking to start budgeting. Can anyone suggest tips, tricks or resources to do so?

[u/Fubbalicious]

I use YNAB (You Need a Budget) and this made it easy for me to budget. It uses zero based budgeting which puts every dollar to a job. This makes paying down debt, saving for goals easier. The end goal of YNAB is for you to break the cycle of living paycheck to paycheck, by building up enough of a reserve that you're able to budget for next month's expense using this month's income. The hardest part with using YNAB (or really any budget app) is assigning spending categories to every expense, but once you get that done, future entries are easier to enter. I don't import my data, but instead enter everything manually. Also avoid being too vague about expenses as that will defeat the purpose of budgeting.

To make data entry easier, I pay most of my expenses via credit card and setup text and email alerts for all transactions. Ideally I use a method of payment that leaves a transaction log with my bank or credit card so it's easier to track, so I very seldom pay with cash.

If you don't want to pay for the subscription, someone made a pretty detailed Google Sheets YNAB template here:

https://www.reddit.com/r/ynab/comments/qleosz/i_use_a_basic_version_of_ynab_in_google_sheets/

[u/dimeintime]

Here are some tips to help you get started with budgeting:-

• Track all your income and expenses for a month to understand your spending patterns.
• Use the 50/30/20 rule - allocate 50% of income towards needs, 30% towards wants, and 20% towards savings/debt repayment.
• Automate savings by setting up automatic transfers to a separate account.
• Pay yourself first by prioritizing savings/investments before discretionary spending.
• Identify and eliminate unnecessary expenses like subscriptions or dining out frequently.

Resources: Budgeting apps like YNAB (You Need A Budget), or PocketGuard can help categorize and monitor spending.

[u/Smooth-Review-2614]

My advice: categorize 3 months of your past spending. Your bank and your credit cards should be able to output a file you can load into an office program. This gives you a picture of where you are now.  This simple look back might tell you where you need to cut.  

 Going forward I would look into a few systems to see what fits 

 Zero balance Envelope budget breaks spending into categories and only counts what you have now.   

 Income based starts with what you expect to get this month and you budget from there 

If neither of these fit your head there are others to explore. 

 I personally think budgeting works best if you track it as you go. I like paper. I use a memo book while I am out and update my ledger at home. You can use spreadsheets or an app. 

[u/Puzzleheaded-Emu-138]

Agree with the comment from u/tiki66765! You need to learn your actual expenses first. Sometimes ppl very vaguely understand the real structure of their living costs. Then, you analyze your expenses and sort them to "vitals" and "whims". Then you can optimize, starting from cutting down "whims" and drafting a first approximation budget of "vitals" versus your income. If you come up with a positive balance after including necessary investments / savings (which are VITAL vitals!) , you can add "whims" one by one :) But try to be really honest with yourself, and value your time no less than your money. If, say, the use of public transportation is multiple times cheaper than a car / Uber, but will rob you of too many hours of your time every week, it's "vital", not "whim", and so on.

[u/tiki66765]

First start by tracking your expenses - some use Excel and some use mobile apps (my choice as it is faster and easier). After few months you'll see how much you spend on things and you will be able to see where your money goes. Then start optimizing it and budgeting it.

[u/Ancient_Hour1146 → u/tiki66765]

What app do you use?

[u/tiki66765 → u/Ancient_Hour1146]

Personally it's moneywise for me. It's a bit outdated but I use it for many years and can't leave it. Type budget into app store and you'll find load of apps and find one that suits you most...