10 Effective Ways to Stick to Your Budget

10 Effective Ways to Stick to Your Budget
Written by Irina Vasilescu

Do you have a clear set of financial goals? Or are you the type to simply leave your finances to fate, and go with the flow when it comes to spending?

Naturally, those who belong to the first group gain better control of their finances. If you belong to the latter category, now is as good a time as any to change your ways and outline your financial goals. By doing so, you can enjoy a more comfortable, financially secure life without ever falling into the trap of being neck-deep in debt.

The Importance of Budgeting

Before counting down the most effective ways that you can stick to your budget, let’s learn about its basics first. What is a budget and how is it important? How can you create a budget? After creating a budget, how can you monitor it and stick to it?

Basically, a budget is a detailed summary of your income sources and likely expenses for a given period of time. If you’re the head of the household and you are living with a spouse and three kids, you can create a budget which lists down the itemized income and expenses for a whole month. If your spouse is also working, how much-combined income is coming into the house?

What are your monthly rental or mortgage expenses? How about utilities, groceries, the kids’ educational expenses, insurance premiums, household maintenance expenses, etc.? You can deduct the total expenses from the combined income – and you should be left with some extra amount that you can use for savings and putting money onto your retirement fund or the kids’ college fund.

Budgets can be created using old-fashioned pen and paper, or a spreadsheet application on a computer. This will help you prioritize your spending and manage your money – whether you’re living on a paycheck-to-paycheck basis, or if you have plenty of funds left for luxurious purchases or savings.

Another reason why it is important to come up with a personal or family budget is that it will help you determine which expenses are considered wasteful. If you see that you’re spending too much on clothes, for example, you can cut back on it in order to save money for the next month.

A budget also helps you adapt quickly as your financial situation changes. More importantly, it helps you achieve your long-term and short-term financial goals.

If you have unexpected expenses, you know where to get the money from. If you are itching for a vacation, looking at your budget will let you know whether you have funds for just a long drive or a flight to a beach destination somewhere exotic. The clearer your financial picture is, the better control you will gain over your life.

Top 10 Ways to Effectively Stick to Your Budget

Now that you already have an idea about the importance of budgeting, what are the specific ways for you to stick to it? Take a look at the following tips:

1. Know how to create a budget in the first place

Creating a budget involves the following steps: first, identify your long-term and short-term financial goals. Second, know where your money is going. Third, add up your sources of income. The fourth and fifth steps involve adding it all up and making adjustments as needed.

For the first step, it is important to specify what your financial goals are so that you can prioritize the items on your budget.

Let’s say that you are saving up for a down payment for a new car. You can create your budget in such a way that a bigger chunk will go towards saving up for the down payment, because that is your immediate financial need. Once you have enough saved up for the down payment, you can adjust the other items accordingly based on what your priorities are.

The second step is all about knowing where your money is going.

The mere fact that you are writing down a budget is already a step in the right direction. You can divide your expenses into fixed needs, variable needs and wants. Of course, you can always skip spending for the wants in order to have enough money for your more urgent financial needs.

The last few steps are adding up your sources of income and making adjustments as needed. By following these simple steps, you can create and follow a monthly budget that will allow you to monitor the ins and outs of your spending.

2. Learn how to monitor your budget

Budgets need to be tweaked constantly, especially if you are going through certain life changes. If you have a new job at a new location, you need to allot money for the moving expenses. But if the move involves a nice rise in your salary, then you can make adjustments with your spending habits as well. The key is to keep a log of your expenses, and not changing your spending habits without first adjusting your monthly budget.

3. Say yes to using cash

If you’re the impulsive buyer type, only withdraw a limited amount of cash from your bank account. It can be your spending allowance for one or two weeks. You’ll be surprised at how easily you can say no to a new dress or a pair of shoes if you’re committed to spending only the amount of cash that you have in your wallet.

4. Steer clear of bad habits and save money in the process

Nobody’s asking you to skip that after-work drink at the bar, but sipping your favorite brew during happy hour will save you a lot. You can also skip the fancy lattes from the coffee shop and brew your own at home before going to work. Smoking is yet another bad habit that you can try quitting. It’s not only your pocket that will thank you for it, but also your wallet!

5. Pay down your debts

Think twice about swiping that oh-so-convenient plastic card if you know that you cannot pay the bill in full. When you put down just the minimum amount on your card, you are still acquiring interest rates and late fees. If you have acquired more than one credit card debt, pay off as much as you can on the card which has the highest interest rate. This way, you won’t have to pay more in interest rates than you have to.

6. Pay your bills online, and on time

Another way to stick to your budget is to pay your bills online, and on time. There are banks which offer clients incentives when they pay their bills before the due date. Paying online also helps you steer clear of late fees from the companies who you owe money to for purchases, services, utilities, insurance premiums, etc.

7. Make adjustments with your budget as necessary

As mentioned earlier, it is a must for you to make adjustments with your budget as necessary. If you have a college-bound kid, you need to set aside funds for the dorm expenses, books and other school supplies. If you’re a married couple and one spouse loses his or her job, you would need to make certain adjustments with the overall household budget.

8. Keep your receipts

You are most likely to overspend and not stick to your budget if you do not have the receipts to show for what you have been spending on. By keeping your receipts, you can get a better grip of your expenses.

9. Balance your checkbook

If you have a checking account, there’s a big probability that you are spending a lot of money on overdraft charges. These charges can really hurt your bank account, and happen when there are insufficient funds in your account. To steer clear of overdraft charges, make sure that you are balancing your checkbook every time you are receiving a bank statement.

10. Force yourself to allot money on a savings account

Finally, it pays to force yourself to allot money on a savings account. It can be your rainy days savings, an emergency fund, funds for your kids’ college tuition or your retirement money. The best scenario is for you to contribute something towards all of these on a monthly basis – although it still depends on how tight your budget is.

You can force yourself to allot money for these savings accounts by considering the amount as a necessary expense. You can also set up an auto debit arrangement with your bank so that it will be easier to set aside funds for your kid’s college tuition or your retirement money. These two are particularly important and the earlier you start saving, the more money you will have in the long run.

As you can see, there are many ways that you can stick to your monthly budget. Budgeting is a very important aspect of managing your finances so that you can live within or below your means.

Living beyond your means equates to spending more money than what you can actually afford – so you will most likely end up in debt. If you’d like to gain full control of your money and have some funds saved up for the future, you can create a budget and try to stick to it as closely as possible.

About the author

Irina Vasilescu

Irina Vasilescu is our crafty designer. She joined the team three years ago and is also involved in the writing process.


  • Thanks for this post, it’s very helpful. I can attest to the importance of using cash every time you purchase something. Having the confidence that you can just pay using your card is a bad idea because it desensitizes you to how much you are actually spending as supposed to having the physical cash leave your wallet.

  • Paying in cash is something I want to do more. I recently started a spending amount for my husband and I in cash for the month, and I think it has helped. I am hoping it will convince him to buy coffee out less and make it at home or at work more. We’re also starting to put a set amount in savings per paycheck. I’ve decided that it should be an account not directly linked to my checking account though, as it is all to easy to transfer money back out to spend at the end of the month if we haven’t stuck to our budget well. We are working on paying down debt, and have consolidated it to get a lower interest rate, which makes a big difference.

  • I’m am really trying to work on doing a better job of budgeting. My husband has just started working after over a year of being on just one salary, and I want to keep our cost of living from rising to meet our new income. One thing we have already needed to address is the fact that he will be eating out for lunch every day. His entire (small) office eats out together, and they discuss work while they eat, so bringing a lunch isn’t really a great option. I’ve just signed up for mint and I need to see if I can set that to a different category than our regular eating out.

  • Cash cash cash! It’s so easy to spend $5 or $10 here or there, but when you actually see and feel the money actually leaving your hand into someone else – some crazy psychological exchange happens. Of course that’s difficult when you order things on the internet, but it’s good to set a specific budget for online purchases only. This way, you can look for sales and spend your money even more wisely!

    • Paying with cash does help some people reign in their expenditures and stick to their budget. However, it doesn’t matter for some people whether they’re using cash or debit or even a check. Not everyone will make the connection between paying for something and having their money just flow out of the bank.

  • Budgeting can be really hard at times. I tend to try saving where I can, but there’s also times where I just buy stuff without thinking, or be to generous and give money to people too much. Something I’ve got to exercise I guess. Also, paying in cash is a good idea because you can stick to a certain limit that way, but it might not be the best idea to be carrying say $2000 in your wallet with you.

  • Say yes to using cash…I like the sound of that. It’s easy to stray away from your budget if you have paperless money like credit cards.I agree with you.I think It’s OK to carry money especially if you have a problem of impulse buying.

    • It’s not OK to carry cash if you have an impulse spending problem, though. There’s a disconnect there that makes you even more likely to waste your money away, and it’s a real shame. People fall into that trap all the time, assuming that carrying cash will help them stick to their budget. It doesn’t always work.

  • Force yourself to allot money on a saving account – and that is the hardest one for me. See, when I make a budget, it alwayss seems that I leave “allowances” for unexpected spendings, but always forget to keep something for my savings account. It is really much hard especially if your budget is really tight and you have nothing to spare for the savings. Anyway, what I do know is leverage the services that the bank offers, the product keep a certain amount of money from your payroll account in aspecified time of the month. This one is much more effective to me since I almost can’t feel that something is taken away for your davings, you will have to adjust whatever is left from your account and make a bidget from it.

  • This is information that people definitely need to see! Everyone at some point or another tries to create and stick to a budget and nine times out of ten they are unable to stick to the financial plan they have set for themselves because they dont realize that changing your financial situation is a one step at a time process. Changing little things about the way you spend can certainly help you get on the right track.

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