Take Control in 2024: Simple Steps to Start Budgeting

by Dr. Katie Hernandez January 9, 2024 1260 Views

A new year is the perfect time to start over or take control. Learning to take control of your finances is a skill that benefits you for the rest of your life.

Budgeting can seem overwhelming – especially if numbers and math aren’t your thing. But mastering budgeting, even in just one area of your life, will make a huge impact on you and your family.

Use this guide to help take the fear out of getting started with budgeting.

Already a budgeter? Great, check out the tips on how to refine your process and take your efforts to the next level.

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Budgeting Basics

Most importantly, get started. You’ll be glad you did.

Whether you’ve been successful with budgeting before or not isn’t important. What IS important is making sure you know where to start. Take these steps to build a rock-solid foundation for your budget.

Track Your Expenses

This is the most tedious and time-consuming part of creating a budget.

But once you learn your repeating expenses, monthly tracking becomes much less work.

Start by recording ALL of your expenses for the last month.

These categories can help you keep things organized:

Monthly expenses (bills that happen every month)
Quarterly and yearly expenses
Recurring expenses (gas, groceries)
Fluctuating expenses (eating out, clothes, entertainment)

Record your expenses using whatever works best for you. This could be a notebook, spreadsheet, app, or expense tracker.

Set Goals

Create clear, achievable goals for your finances. Include a timeline for completing each goal to hold yourself accountable.

A goal without a timeline is just a wish.

Goals could include paying off debt, saving for a vacation, creating a specific emergency fund, or buying new appliances.

Creating budgeting goals gives you purpose and motivation. After all, what sounds more fun: saving for a Disney vacation next summer or saving just in case? I’m definitely skipping the iced coffee and putting that money in the Disney fund!

Create a Budget That Works for You

What’s the use in creating a budget if it doesn’t work for you and your family?

Take the time to understand your financial situation and goals first. This will give you clear direction on how much you need to save and spend to reach your goals.

Here are a few of the most common budgeting plans.

Envelope system^[1]
50/30/20 rule^[2]
Pay yourself first^[4]
Zero-based budgeting^[3]
60% solution^[5]
Values-based budgeting^[7]
Automated budgeting^[6]

Try out one or a few to find what works best for you.

Tips for Absolute Beginners

First-time budgeter? *Congratulations!*

Creating and living on a budget is a journey, not a destination. Enjoy the process and make it work for you.

Start Small

You don’t have to go head-over-heels, all-or-nothing with your budget.

Start by choosing one aspect of your finances that you want to take control of. Maybe start with understanding your monthly expenses or defining your weekly grocery budget.

After you feel comfortable with the first part, gradually add more categories. You’ll have your finances under control in no time.

Be Realistic

It’s easy to get caught up in the romanticized view of living a budgeted life where you suddenly find tons of money you didn’t know you had.

But it’s even easier to get overwhelmed and frustrated when your budget doesn’t fit into your nice, neat categories.

Make sure your goals are realistic and achievable from the get-go. And be sure to give yourself grace when you overspend in one of your categories.

Maintaining realistic expectations will help you not get frustrated and keep you on track.

Monitor and Adjust

Your budget is a living document, and you must treat it as so.

Look back over your budget monthly (at least!) and see where you need to make adjustments. Find areas where you need to allocate more and where you can cut back.

Making the necessary adjustments will keep you from getting frustrated, and make sure your budget fits your life.

Teach Your Kids About Budgeting

You don’t have to be perfect at anything to teach it to your kids – budgeting included!

The sooner your kids start developing sound money habits, the sooner they’ll stick. The budgeting habits you teach your kids can stay with them for the rest of their lives.

Even if you’re new to budgeting or you’ve tried and failed dozens of times, use this opportunity to try again. Teach your kids all about the joys of managing your money wisely.

Lead by Example

Some people are natural savers. Some can burn through their money before it hits their pocket.

Whether your kids are savers or spenders, all kids learn best by following the example of their parents.

Be vocal about your money choices. Show them your budgeting plan, even if it’s a simplified version.

Let your children see you actively plan to save more than you spend. Show them when you put money aside to reach a goal.

The more your kiddos see you making smart money choices, the more likely they are to copy these actions in their own lives.

Use Real-Life Opportunities

Seeing is great. Observing is wonderful.

But doing. DOING is powerful.

Give your kids the opportunity to practice making smart money choices.

Start small by involving your children in grocery shopping and choosing only what you need to make sure you stay on budget.

Teach them about goals by helping them make a plan to save up for a toy they want.

When your children have a good understanding of budgeting, let them live it out by budgeting their own money each month. They should budget for clothes, special snacks, toys, and savings. Even if they fail miserably, think of all the lessons they’ll learn!

Make It Fun

Don’t forget to make budgeting fun with your kids. It should never be presented as a scarcity way of living or a chore.

The more fun it is, the more kids will internalize it and want to continue making smart money choices.

Look for apps, games, and educational resources to help keep your kids motivated. Find what they enjoy and what works best for them.

Just like with adults, what works best for your kids is going to be what sticks.

What to Do When You Slip Up

It’s inevitable. You can have the perfect, polished budget written in gold glitter with every dollar intentionally placed.

Then something unexpected happens and blows your beautiful budget into a million pieces. Or you have a moment of shopping weakness and splurge on the new LuLulemons.

There will be months that you simply don’t stick to your budget. But that doesn’t mean you need to give up your budgeting efforts and lose all the progress you made.

Take these steps to get back on track with your budget.

Acknowledge Where You Went Over Budget

Sometimes, this is easier said than done.

If it’s one event, find it and identify it as the one thing that made your budget out of whack.

But sometimes, it’s a collection of smaller events.

Extra ice cream at the grocery store. $20 more than you planned to spend on shoes. Driving more than usual, so you need to buy more gas.

Find the areas where you went over what you had allocated and acknowledge that you spent more than you planned.

Revisit Your Budget

Remember the budgeting step “monitor and adjust”?

This is a naturally planned part of budgeting because messing up your budget is natural!

Once you’ve taken the time to acknowledge where your budget went awry, you can adjust your budget to support these areas.

If you frequently have large, unexpected expenses, you may need to budget more for emergencies.

When you notice yourself going over budget in multiple categories, you may have to have some tough love. Ask yourself, what’s more important – buying this or meeting my goal?

Keep your goals at the forefront of your mind to help you stay on track. You’ll be amazed at how those temptations don’t seem so appealing anymore.

Keep Going

Budgeting is a journey full of ups and downs. You have to make tough choices and sacrifices. You also have rewards and victories to celebrate along the way.

The first step is simple. Just get started.