10 Tips to Make and Stick to a Budget

It isn’t that budgeting is so hard really, but it's about establishing new habits. And any new habit takes some time to stick.

Here are our top ten habits to make a budget stick—establish some of these proven guidelines and practices and you'll start strong and stick with it because you see and feel it working:

1. Know What You Want

Think about what’s most important to you. Some things will be pretty obvious (a roof over your head, etc.), but then what? Take time to think about what you really want—your budget is a tool to make sure you have money for those things.

Sometimes you think about these in terms of big things:

• Putting the kids through college
• Taking that dream vacation
• Buying a new car
• Paying off your mortgage
• Retiring early

But other times, it's actually about little things:

• Coffee from the coffeeshop or a new shirt?
• Steak or salad?
• More for going out to eat or more for weekend adventures?
• A gym membership or a Spotify subscription?

These smaller would-you-rathers come in every flavor imaginable. When you're using a zero-based budget like YNAB, you're building up your decision-making muscles almost daily. You're making dozens of these decisions in a month. Sometimes dozens in a day if it's a payday!

With each decision, you get a little more clarity about what's most important to you. That means when it's time for those big decisions, it's basically like The Rock lifting a 20-pound weight. Effortless. Easy.

Keep building up that habit by giving every dollar a job and finding the money first before you spend.

2. Plan A Regular Budget Meeting

When you are budgeting with a partner, you have three sets of priorities: yours, your partners, and the ones you have together. Make sure you sit down and talk about what’s important to both of you. Being on the same page will increase your chance of success. Checking in once a month, to think through circumstances that have changed, new information, unexpected expenses and how all these things impact and shift priorities is important. It keeps everyone engaged and the communication open. This is good for finances and relationships!

Learn more about navigating the highs and lows of budgeting with a partner on our resource hub.

3. Only Work With Money You Have Right Now

You may be tempted to project what you'll have a month from now. Resist this urge. Focusing on the past or projecting into the hypothetical future, takes away the impact you can have in the here and now where the real power lies.

Just look at how many dollars you have right now that you can put to work. Figure out that number. That’s what you’ll start with and you will give each of those dollars a job.

• When you get paid: give those dollars jobs (and not a moment sooner).
• When you know you're getting a bonus: don't "spend" that money before it arrives.
• When you are planning to get a tax return: don't give those dollars a job to do until they hit your account.

4. Set Money Aside For Your Immediate Obligations

Start with the obvious and most important obligations: Rent, Utilities, Groceries, Gas, minimum payments on Debt. As you start assigning dollars, you will cover these critical categories first. This first step alone will start to reduce your stress—the non-negotiables are taken care of!

5. Prepare For Non-Monthly Expenses

These are the things that can blindside you (read: cause you to reach for your credit cards!) if you aren’t ready for them. For example, things like car repairs, Christmas, vacation, insurance premiums—you know they are coming, even if you don't know exactly how much they'll cost. But you need to treat these categories like monthly "bills," and put money away for them every month.

How much should you budget? You need to figure out when the bill is due and how many months you have to save for it. Annual Car Registration is $200, but it’s eight months away. So for now, budget $25 a month toward it. And when it rolls around, and you have all $200 just sitting there, waiting to do it's job, you will feel like a financial whiz kid. You can pay it without a second thought.

For some of these expenses, like car repairs, you don’t know when it will happen or how much it will be. But it will happen. So make your best guess, and do what you can do. It’s certainly better to have something saved then nothing.

6. Create A Debt Plan

Part of your budget should be dedicated to paying down debt. Choose the debt with the lowest balance and budget more than the minimum. Pick an amount you can handle, and make minimum payments on the rest. When this debt is gone, take the money you were sending to it and start budgeting it toward the new lowest balance debt. Pretty soon, all that debt will be gone! (More about how to get out of debt).

7. Don’t Forget The Fun Stuff!

It is important to budget for things that improve your quality of life—the fun stuff is important too! Even if you have big, serious goals, if you want to stick with budgeting for the long haul, you have to give yourself some breathing room. Don't cut out all the little things you love that improve your life. Maybe you don't get a Starbucks every day, but you cherish the ritual once a week. Or you don't eat out as much as you used to, but you budget some money for eating out because it is something you love to do. Budgeitng is all about the long game, make it something sustainable for your life.

8. Track Your Spending

Once your budget is in place, track all of your spending. Every dollar. Your budget is your new True North, instead of checking your bank balance to see what you can spend or what you have, you'll be consulting your budget. Before going grocery shopping, check to see what you have left set aside for groceries. You might have $1,000 in your checking account, but that money has been assigned to other jobs, so you will want to stick to the $70 remaining dollars you have allotted for groceries. This simple shift in thinking is powerful because it allows you to make better decisions, better aligned to your true priorities.

9. Adjust And Adapt

Unless you have the ability to predict the future with 100% accuracy, you will have to adjust your budget. So, all of us, every month. Adjustments are good. Your life changes, your circumstances change, your priorities shift—your budget has to keep up! So, don’t be afraid to change your budget. It isn't a failure. It isn't doing it wrong—quite the opposite. When you overspend in a category, you just have to decide where that extra money can and should come from. Overspent on eating out? Move money from clothing where you have some extra. Problem solved. No guilt necessary.

10. Budget For The Future

As you begin to budget, your money will start doing exactly what you tell it to do. You will be in total control. You will find yourself with more and more disposable cash. People often say it feels like they got a raise! When this happens, start budgeting ahead. Begin budgeting for the next month. If you can get a month ahead of your expenses, and be spending money today, that you earned last month, you will experience peace of mind like you never thought possible. Zero stress.