How To Create a Budget Around Your Lifestyle

All our lives we are preached that we need a budget. But, HOW??!?

Don't worry, I've been in your shoes. Budgeting is something I never learned in school, especially beyond the capacity of a business budget. Personal budgeting is so much different because the goals of our personal vs our business are likely different! Of course, we want to not be in the negative of both, but you're likely dealing with a lot of circumstances.

Why You Should Budget

It's not just a buzzword. Budgeting can actually be such a lifesaver. There were multiple points in my life where I thought budgets were stupid. I thought, why would I budget if I don't know what's going to happen next? Why would I budget when I can just quickly look at my account balance and see what's left and if I can afford whatever was in front of me?

Myths about budgeting

1. It makes you feel guilty about spending → Budgeting done right should make you feel confident in your spending, not guilty!

2. You only need to budget if you have a problem → Noooo! Start budgeting even when you feel stable, so you don't run into problems in the future.

3. It makes you cut out everything → If anything, it should make you make room for new, fun things!

4. You should only budget if you have debt → Even those who don't have debt should be budgeting. This allows you to set savings goals and allocate your money in new ways.

How to Create a Budget

Goals

1. What do you want to save?

2. Do you have debt? What debts are the most pressing to pay off?

3. What are your essential expenses?

4. What other expenses take priority in your life?

5. What timeframe?

Income

Start with determining your income. If it's not consistent, you'll have to find an average from your past year instead, or you can go off of your last lowest paycheck or last year's income as a whole if you are in the same role. Your income can include passive income (rental, investments, stocks, passion projects), your salary, freelance work, etc., but make sure you are working with your gross numbers vs your net (i.e. make sure you are looking at the total after taxes come out). List this all out, in a monthly average to have a starting place to go off of.

Expenses

Think about and review what your common expenses look like. Every month will look different in terms of expenses and that is what makes setting a budget important and also flexible.

1. Fixed Expenses: Expenses that stay the same

2. rent/house payment, insurance, car payment, subscriptions

3. Variable Expenses: Things that are consistent expenses, but the cost varies

4. groceries, utilities, gas

5. Irregular Expenses: Expenses that pop up or occur less often

6. annual charges, holiday gifts, car maintenance, medical expenses, home insurance

Setting Limits

Based on your spending habits, set realistic limits for each category. Emphasis on realistic because your budget shouldn't make you feel like crap every month! Look at what you have been spending in each category,

1. Groceries: $400/month

2. Eating out: $150/month

3. Savings: $500/month

Tips for Setting a Budget

1. Set priority on everything. Sometimes you will have to make cuts in certain categories, so know what's most important to you. Obviously your basic living essentials will come first — food, utilities, home, etc., but what's next in line in importance to you?

2. Add in fun money! Your budget doesn't have to be boring and your life isn't over after setting one. You should be adding in wiggle room in your budget for all the fun things you enjoy — and yes, that can be your late-night UberEats order, or Saturday morning coffee at the coffee shop across the

3. Leave wiggle room. You don't want to consistently be pulling out of your monthly savings goals for things that pop up. Leave space for miscellaneous expenses, because you can't predict it all. Think about that random vet appointment for your pup, or after-work happy hour with your team. These things can't always be accounted for but we can have a reserve that we can take out of, vs stealing from our savings!

4. Consistently adjust your budget. You can't just set it and forget it. Your budget should grow with you and your changing lifestyle, and that's how you make it work for you! It should look different every month because you have different needs.

Budgeting doesn’t have to feel overwhelming or restrictive. It’s all about creating a plan that supports your unique lifestyle. Whether you’re just starting or looking to refine your budget, the key is flexibility. Give yourself grace as you figure out what works best, and remember that a budget isn’t there to limit you — it’s there to give you financial confidence and freedom.