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How You Can Make the Right Budget

When it comes to a budget, there isn’t a one-size-fits-all formula. One budgeting strategy will work perfectly for one person while frustrating another.

Your personal budget should be exactly that: personal. It should match your financial needs, your lifestyle and your personality. Without making those considerations, your budget will inevitably become a failure.

How can you customize your personal budget? Start by reading these different budgeting strategies to see which ones you would like to adopt and which ones you’d like to ignore.

Budgeting Tools

The first thing that you have to ask yourself is where you want to make your budget. Do you want to make it in a spreadsheet program, or would you prefer to use a budgeting app?

Spreadsheet Software:

Use a spreadsheet software program like Microsoft Excel, Google Sheets or OpenOffice Calc to create your personal budget.

Open a new document and start labeling rows with your budgeting categories, like rent/mortgage payments, utilities and groceries. In the next column, put the amount you’re reserving for this specific category. In the following column, put how much you’ve actually spent on this category in the past month.

At the bottom of the spreadsheet, list your total income. Underneath that, list the total you’ve spent. Your “total spent” category should be lower than your “total income.” If it isn’t, you’ll need to edit your budget to boost your savings.

Budgeting Apps:

Download one of the top budgeting apps on your smartphone or computer and follow the instructions. The app will guide you through making a budgeting spreadsheet, along with other visual aids like charts and graphs.

What makes this option different than using a spreadsheet? Most budgeting apps can sync with your online banking. The app can connect with your checking accounts, savings accounts, credit card accounts, investment portfolios and more. By syncing with your online banking, you can track your spending and determine whether you’re following the budgeting guidelines that you set for yourself at the beginning of the month.

Budgeting apps offer other features that can make managing your finances much easier. Mint gives you free updates of your TransUnion credit score. Honeydue helps couples share their budgeting needs. YNAB has a loan calculator to help you plan your debt repayments.

Finally, budgeting apps are designed for mobile use. You can check your budget wherever and whenever, like when you’re filling up your shopping cart at the grocery store or going out for a dinner date at a restaurant.

Saving Techniques

Do you struggle with saving money? There are a few budgeting strategies that you can try to guarantee that you’re contributing to your savings accounts every single month.

Budgeting Percentages:

A simple strategy to save more is to use budgeting percentages. You could follow the 50/30/20 Rule. The rule asks for you to divide your income into three categories: needs, wants and savings. You’ll assign 50% of your income to needs, 30% to wants and 20% to savings. While savings is the smallest category, it’s still a significant portion of your income.

Other options are the 70/20/10 Rule and the 80/20 Rule. With the 70/20/10 Rule, 70% of your income is assigned to living expenses, 20% is for debt repayments and 10% is for savings. With the 80/20 rule, 80% of your income is assigned for living expenses and 20% is for savings.

If you’re not sure how to get started on this, you can click here to learn how to manage money with budgeting percentages and stash away savings. Doing this will help you achieve savings goals like building up an emergency fund.

With an emergency fund, you can cover urgent, unplanned expenses without disrupting the rest of your budget. You can withdraw the necessary savings from your fund, tackle the expense and move forward without any stress. Without an emergency fund, you might have to turn to a credit tool like a credit card or personal line of credit loan for help.

Pay Yourself First:

Another saving strategy is called the “pay yourself first” budget. This is when you contribute funds into your savings accounts immediately after receiving your paycheck, instead of waiting to do it at the end of the month.

The “pay yourself first” strategy means that you won’t leave your savings contribution to the last minute when you could potentially forget about it. It also means that you won’t use this money meant for savings on non-essentials, like a shopping spree.

Go to your online banking and set up automatic transfers between your checking and savings accounts. Make the transfer recurring, so it happens every single month, right after you’ve received your paycheck.

Payment Options

Finally, you have to figure out how you’re going to pay for all of your expenses. Are you using cash? Debit? Credit?


In this modern age, you’re not likely to use cash to pay for the majority of your essentials like rent payments, insurance payments or utility bills. But you can still use cash to pay for expenses like groceries and clothes.

One of the biggest benefits of paying with cash is that it can help you stay on budget. With cash, you can’t spend more than you have — eventually, your wallet will get empty. If you struggle with overspending, you may want to consider using cash as your primary payment method. You may even like the envelope budgeting method.


Debit cards are safe payment methods to choose for your small, everyday expenses. You will be using funds directly from your checking or savings account to make the purchases, so you won’t have to worry about repayments later.

Unlike cash, it can be easy to overestimate how much you can afford with a debit card. You could accidentally spend too much and put your account into overdraft. If your debit card is your main mode of payment, check how much is left in your account before you swipe it at the register.


Credit can be an excellent payment method for a variety of expenses, from bills to electronics. It allows you to cover costs when you don’t have enough funds in your checking account. It provides consumer protections, like extended warranties and limited liabilities in cases of financial fraud. And it can help you build up your credit score over time.

The only issue with your credit card is that you’re using loaned funds. You should only put transactions on your credit card that fit your budget. This way, you can pay down your balance by the end of the month. If you don’t pay your balance down, it will quickly accumulate interest and grow.

As you can see, there’s more than one way to build a budget. Find the way that works for you.