Stupid simple budgeting tips and personal budgeting tips I can't live without, after 20 years of creating and living on a budget.

Let’s be honest – writing a budget is pretty simple.

You simply need to:

woman in red striped shirt holding wallet of money, text overlay "14 stupid simple budget tips for beginners from 20 years of budgeting"
  1. Write down your income
  2. Write out your prioritized expenses (bills, wants, savings)
  3. Subtract your expenses from your income to make sure it’s a positive number

Most people know this.

But just because budgeting is simple in theory, does not mean that it’s easy in practice.

Newsflash: simple and easy do not mean the same thing!

That’s why I’m going beyond just the strategy of how to create a budget, and into the realm of really useful, and really simple budgeting tips for beginners.

Psst: this advice assumes that you already have a way to budget, and that you’ve read how to budget. In case that’s a bad assumption, then check out this article on how to setup a budget.

Simple Budgeting Tips for Beginners

Grab your current budgeting worksheet, budget app for couples, or whatever else you use to figure out how to spend your money…and read through these really helpful (and simple) budgeting tips for beginners.

I promise, you’re going to uncover some gems!

Tip #1: You Don’t Need that Second Job

My husband, Paul, has told me a few times over the years that he needed to get a second job to bring in more income.

Every time he would say this, I'd look at him like he had two heads.

Because in general? You don't need that second job.

If you find yourself near the poverty line, under the poverty line, or generally not covering your basic necessities, then yes, finding a second or more lucrative job is important.

Psst: here's 17 simple tips for how to stop living paycheck to paycheck. And here are 12 stories of real people living paycheck to paycheck (plus how they got out of it).

But most of us can just use a tune-up on our budgets.

Wouldn’t you rather curb your spending a bit each month then spend 15+ hours more away from your family and home working at a job you might not like?

I caution against working your life away to meet your spending appetite. Instead, curb your spending appetite so that you get to live a fuller life.

Tip #2: Your Goal Needs to Go Beyond Paying the Bills Each Month

Your goal should not just be to pay the bills each month (though this is a worthy goal).

Because if you continue down that path? You'll be in the same position you're finding yourself in right now.

To ensure you are in a better financial situation in the future, there are several other areas you should keep in mind when filling out a budget sheet.

Including:

  • Savings (emergency fund, college fund, etc.)
  • Retirement (it will happen for most of us one day)
  • Increasing your future cash flow (by allocating enough in paying down debt each month that one day more of your paycheck will be yours)

Tip #3: Know Your Drop-Bottom Number

What is the bottom-line number that you have to bring in (earn) each month in order to live?

Not in order to thrive, but in order to survive.

It’s always good to keep this number in the back of your head so that you can know what to shoot for as your drop-bottom, and what your cash flow can (and cannot) handle each month.

This number includes just the basic necessities, such as:

  • Food
  • Housing
  • Medical needs
  • Running water/electricity

For example, our “Drop-Bottom Number” each month is $2,060. That includes our rent payment, our water payment, our electricity payment, and our grocery bill for a month.

It does not include “thrive” categories, like savings, insurance, retirement contributions, Montessori preschool, etc.

And that’s okay! I just want to know what we would need to bring in each month to keep the roof over our heads, to feed ourselves, and to survive.

Tip #4: You're Not Married to a Budget System (SO, Try Around)

There are soooooo many budgeting systems out there.

The idea is to find what I like to call your “Couture Budget System”.

Not sure what a budget system is? Here's my definition:

A budget system consists of prioritizing what to do with your money – spend, save, bill payment, invest, etc. – over a specific period of time, the actual method you choose for spending (or expressing) those plans, and how you choose to track everything.

A Couture Budget System means it's completely customized to you.

Meaning, you mix and match from the various budgeting tools and systems until you find the exact strategy that fits you like a, well, tailored-made suit.

I've got a whole article that deep dives into the personal budgeting methods, but let me just give list them out there:

  • Conscious Spending Plan
  • Zero-Based Budgeting
  • Balanced Money Formula
  • Pay Yourself First (and Live on the Rest)
  • Gift Card Spending
  • Cash Envelopes
  • Your Money or Your Life (YMYL) Tracking Method
  • Couple's Budget Apps
  • Net Worth and Budget Tracking Software (we use the free Personal Capital)

Tip #5: Allow for an “Other” Category

Just like a kitchen needs a good junk drawer, a budget can use a good “other” category.

Especially if your budget is rather small.

Having an “other” category may save you each month from repeatedly stealing from your entertainment funds, or grocery funds, or *gasp* your savings account when extra costs creep up (as they typically do).

At the end of the month if there is still money left in the “other” category money? You can choose to pad your account/jar/envelopes with the extra for the next month.

OR, you can spend it as you wish.

Tip #6: Your Current Budget Likely Won't Last Through the Year

The better a budget reflects your actual lifestyle, the more likely you are to stick to it.

Budgets need to be changed as your needs, wants, goals, and income changes.

Don’t be afraid to pick one month out of each year to tweak your budget (or tweak it each time you have a change/go through a transition).

For example, the agency I used to work for stopped giving cost of living increases for three years in a row. This was during the recession, when lots of places stopped giving increases (such as my husband's company, as well).

But you know what? Our cost of living didn't get the memo. It kept rising.

This left us with a small, but noticeable gap in our budget between what we had expected our expenses to be and the reality of the situation.

When tweaking your own budget, think about pulling some levers to make things work for your current situation, such as:

  • Increasing the flow of money to your checking account (and less towards savings or elsewhere)
  • Finding a way to earn more cash from home
  • Decreasing your spending in a category
  • Filling the gap from savings to get you through (as a last resort)

Tip #7: Working Backwards is Key to Your Savings Success

There are two ways to work a budget: by figuring out what you want in your savings and working your way backwards, or by filling in each of the categories until you finish the list.

I know this sounds like it is the same thing, but the difference is there.

When you do the latter, you may have no money left for the savings category and will be quick to give up. When you do the former, then you must get creative with the money that is leftover after allocating to your financial goals.

At the end of the day you cannot spend more than you make.

But you might stretch your imagination a bit by figuring out what you would like to save for the year, dividing it by 12, and then filling in the other categories.

Psst: still in debt-payoff mode? Here's how to figure out how to pay off your debt in one year.

Tip #8: Treat Your Savings Category as a Bill Collector to be Paid

This tip's great for how to save on a tight budget: treat your savings category as a bill to be paid.

Otherwise, you might constantly pilfer from here when in a pinch (perceived or not) and may end up in the same financial place next year.

Wondering how to budget and save money? You have to make the changes now to ensure a brighter future.

Pssst: here's 250 highly actionable money saving tips.

If your head is barely above water, you still need to figure something out so that next year the water level only comes up to your neck.

Keep working on your budgeting skills and saving money, and you could fine yourself merrily wading in the kiddie pool just two years from now!

By not allowing yourself, mentally, to see your savings category as the go-to when in a pinch, you'll give yourself the opportunity to be creative with your limited resources.

Personal Budgeting Tips (After Your First Few Months)

You’ve got a few months under your belt with this whole budgeting thing now.

Congratulations!

I wanted to offer up my simple budgeting tips for after you’re out of “beginner” and moving into “advanced” on your journey.

Tip #1: Give Your Money Meaning

Pay attention to this, because this one simple tip has the power to grow your savings immensely.

My money is much more than legal tender used to purchase the things and experiences I want.

My money actually symbolizes independence to me.

And once I gave money such value in my teenage years, you can bet it became much harder to part with it.

I mean, how can buying another $12 lip gloss stack up to independence?

Enough said.

Equating money to something important to you will help you to hold onto more of it.

Tip #2: Pay Attention to Your Budget Intensity Level

When sitting down to budget, you have to decide how tight to pull in the reins.

If you are in a desperate situation, then your budget will need to be extremely tight with little added cushion or hardly any excesses (entertainment, luxury items, gifts, etc.). If you're debt-free and meeting your other savings goals?

Then your budget is going to look very different.

While Paul and I were paying down our non-mortgage debt in 2009-2010, our budget was a bit intense. We did not allocate anything for entertainment though we definitely kept ourselves entertained. We did no-spend challenges, we grocery shopped every other week (still do) and cooked nearly every meal at home on a $250 monthly food budget.

Now that we have reached non-mortgage debt freedom, our budget has eased.

We both have fun money to spend on whatever we wish each month, we allocate money towards a travel savings account, and we have upped our grocery budget (which has delighted both of us because we enjoy experimenting in the kitchen).

I would also caution against a high intensity level for too long of a period; when there is no room in your budget to cut loose, you tend to snap back to the other extreme and binge spend after a period of time. Moderation works in finances as well!

Trick #3: Make ‘Investments’ Now to Free Up Money Later

I remember when I first sat down to budget right out of college and realized just how little money I had to spend in each category.

In my case, this was self-imposed because I wanted to meet my savings goals.

But it still felt limiting

Instead of dwelling in that feeling of limitation I overcame it by getting creative.

Over the years I have found that you can grow the spending power of your budget from month to month without adding any money to it.

Not only can this help with inflation, but it can also give you some breathing room.

To achieve this, take a small amount of each month’s budget to “invest” in future cost savings.

With a tight budget, this could be $5 or $10 per month to start with (adjust the amount accordingly).

It may feel impossible at first, but it’s really you doing something nice for your future self.

Here’s how to “invest” that money:

1. Purchase More Durable Non-Durable Goods

Sometimes it pays off to spend a few extra dollars when purchasing an item now so that it will last longer down the road.

For example, we:

  • Metal Instead of Plastic: Purchased a metal paint pan that we washed and reused throughout our home on numerous projects rather than purchasing the cheaper, flimsy, plastic kind that gets the job done but is meant to be thrown away.
  • Glass vs. Plastic: Spent more money on glass bird feeders because we learned that the plastic kind, though cheaper upfront, had to be replaced within months due to squirrels tearing through the holes.
  • Washable vs. Refillable: Switched to the Reveal Mop (with refillable bottle – vinegar and water – and washable mop head) from the Swiffer mop, which made us buy refills all the time. That was four years ago! The mop has more than paid for itself.
  • Washable vs. Disposable: My sister gifted me a microfiber cleaning cloth set that is supposed to last years and years. Not only does it get my counters cleaner than I've ever seen them, but it's taken the place of both cleaners and paper towels in our household. It's amazing.

2. Buy Items that Replace Future Spending Occasions

Perhaps you can use your ‘investment’ dollars this month to purchase items needed to change your own oil.

This investment will pay you back for months and potentially years to come by keeping you out of service shops.

When looking for a crib for a newborn, spend more upfront so that your crib can be turned into a bed, thus saving you from having to enter a bed store in a few, short years.

3. Make it Yourself for Lower Cost and More Product

I recently purchased all of the ingredients necessary to make my own laundry detergent for about $8 (I say about because I actually have enough ingredients left to make another half batch).

Not only should this last for at least twice as long as store-bought brands, but it also will reduce the amount of chemicals in our home.

Think of areas in your own life where you can make something from scratch and save your family money.

4. Buy Bulk

For items that you use consistently (like the copious amounts of mustard my husband consumes each month), spend that extra money you have allocated to invest on making a bulk purchase that will cost more up front but last longer.

You could buy bulk diapers, pet food, cooking oil, batteries, toilet paper, etc.

The trick is, don’t use more of the item now that you have more of it in your home.

Pro tip: One way to avoid this is by pouring the bulk item into your last, normal-sized empty container of the product and storing the rest so that it is out of reach/out of sight.

Try to stretch it out so that next month or even two months from now you do not need to purchase the item within your budget at all!

Trick #4: Funnel the Extra Money to a Purpose

As the months go by the effect of making small investments in your future budget will begin to give you some breathing room.

Perhaps one day towards the end of a future month you will notice that you have an extra $30 left burning a hole in your pocket because of the frugal snowball effect you’ve created.

Are you going to splurge with the extra money? Could you tack this money onto next month’s budget and begin an even bigger snowball of extra funds? Or do you want to set the money aside in savings?

The choice is yours to make, but it is a choice that deserves some of your attention as you continue to make small ‘investments’ and see the gains in future budgets.

We all know how extra money tends to disappear (I blame Checking Account Gremlins).

Tip # 5: Create a Spillover Account

If you're just beginning to budget, then you'll quickly face something that the rest of budgeters have long been acquainted with: the unexpected monthly expenses that do not fit into your categories.

Examples include an unexpected car repair you need to make in order to pass inspection, an opportunity that wasn’t available before that you would love to take advantage of, an appliance breakdown, unplanned doctor visit and antibiotic, etc.

When this happens, it is easy to throw your hands up in the air and give up in the name of a force greater than yourself which you are convinced will continue to sabotage all of your saving efforts (forget about the fascination our culture seems to have with the sock gremlin who lives in the dryer; I’d love to get my hands around the neck of the money gremlin).

But don’t give up just yet!

You may be tempted to tap the emergency fund to rid yourself of these money gremlins. But this is not necessarily the best answer as the money gremlins tend to just keep coming; if you tap the emergency fund every time you are in a pinch, your fund will disappear.

There are many strategies financial experts have developed in order to protect you against these expenses that seem to come out of nowhere. My favorite one is the idea of opening a spillover account (separate from your emergency fund) where you budget a certain amount each month to be deposited into as well as sock away any leftover budget from less expensive months.

The next time an unexpected monster from the depths of the black hole promises to wreak havoc on your budget, you simply take from your spillover account, and voilà: your monthly budget is unscathed.

Remember that it's easy to give up or get discouraged if a budget doesn't “work” for you. Especially since you spent time to sit down and be intentional about your spending. Honestly, I could imagine ways to throw off my budget all day long and I am convinced life would still throw out something I had not even given a moment’s thought to.

But Paul and I still budget because we have learned that giving your money a purpose will allow you to save more of it than if you had given it no purpose at all. Hopefully, you can thwart some of those “what if's” by using these simple budgeting tips, as well as work through the ones that you just didn't see coming.

Remember: even a bad plan is better than no plan at all!

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Amanda L. Grossman is a Certified Financial Education Instructor, Plutus Foundation Grant Recipient, and founder of Frugal Confessions. Over the last 10 years, her money work helping people with how to save money and how to manage money has been featured in Kiplinger, Washington Post, U.S. News & World Report, Business Insider, LifeHacker, Woman's World, Woman's Day, ABC 13 Houston, Keybank, and more. Read more here.
11 replies
  1. bakiye temel says:

    I always follow your writings you have a beautiful texts. thank you

    Reply
  2. Laura says:

    Your article really hit home. Even though there are constant “signs” that the economy is recovering, your article clearly articulates whey most people don’t feel like the recession is over yet.

    One suggestion I have: Perhaps 7-10 days before the end of your electricity billing cycle, check your usage for the month and see how much electricity you would have to “waste” to prevent the low usage surcharge. You may find that some months you are so close to that limit, that by using more electricity, it will only increase your bill by, say, $3, which would be less than the $10 fine.

    Reply
    • FruGal says:

      Definitely a good idea! I think it is will be something I don’t necessarily remember to do though.

      Reply
  3. Ashleen Moreen says:

    I agree. All the things that we need are increasing even our basic needs like foods and clothes are now cost highly. We need to save every cents that we have.

    Reply
  4. Shannon-ReadyForZero says:

    My mom works for the county government and hasn’t had a raise in five years. On top of that, they even have forced furloughs once a year and layoffs of much-needed workers. This, combined with the rise of gas prices (which also seems to correlate with the rise of grocery prices), has made things a lot tighter for my parents. Since I’ve been living in expensive cities since 2008, I’ve sort of gotten used to over-paying for just about everything myself.

    Reply
    • FruGal says:

      It sounds like your mother is pinched. Hopefully she had a buffer between expenses and income before…however, working for the state goverment myself, I am assuming her income is not much.

      Reply
      • Shannon-ReadyForZero says:

        You are right about that, not much of a buffer. Luckily, my parents are very good at being frugal and making a budget work!

        Reply
  5. Wendy says:

    This article hit home in more ways than one! The entire country is in the same boat, and I know a lot of seniors who struggle much more than they should have to in retirement.

    One way to pad the checking account in a slow but sure way is: round up to the nearest dollar on every transaction. Keep the difference in your checking account, and sooner or later you’ll see the pennies start to grow. 🙂

    Reply
    • FruGal says:

      That is a great idea! I use the same strategy myself, but for when I put money into savings (above our automatic withdrawals). I will take a look at how much we would need to get to another milestone, or an even number, and then add that amount. It helps you to stretch yourself.

      Reply
  6. krantcents says:

    As a teacher, I haven’t seen a raise in years! Many if not all of my expenses seem to rise anyway. I still make savings my priority, but I either cut or reduced some of my discretionary expenses.

    Reply
    • FruGal says:

      It’s a good thing you are so great with money. As a teacher, don’t you also have to pay for classroom accessories out of your own pocket?

      Reply

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