For some, making a personal budget sounds about as appealing as licking a subway floor.“They think of it as the dreaded ‘B-word’,” says Robin Snell, a certified financial planner and founder of Nested Financial and Tax Planning. Money is emotional – it determines where we live, what we eat, the education and healthcare we can access, how we socialize, what hobbies we can take up and how much we can travel. And like many emotional topics, a lot of people would rather avoid thinking about it.But avoiding a budget is often more of a headache than making one. Budgets ensure that we are “not overspending, and that your money is going where you need it to go”, Snell says. “When you start a budget, you are able to assign every dollar a job, and by doing that, you can start to pinpoint where money is going for your own happiness.”How does one begin? we asked experts.Take stockBefore you can begin to move forward financially, you have to figure out where you stand. To start, experts recommend keeping track of all your incoming and outgoing money for 30 to 90 days.“[Budgets] can be helpful as a diagnostic tool,” says Katie Gatti Tassin, founder of the personal finance podcast and education company Money With Katie. By retroactively looking at what you’ve spent, you can begin to reflect on whether your spending behaviors are aligned with your financial goals.Keep track of your budget by using a budgeting app, tracking on a spreadsheet, or charging everything to one bank card so you can review your statements at the end of the experiment and see where all your money went.Figure out where your energy is best spentOnce you have a grasp on where your money is going, you can figure out the most efficient way to redirect it. Generally, people who struggle with money fall into one of three buckets, says Tassin.The first are those whose costs and spending are reasonable, but who aren’t currently earning enough to save any money. For people in this bucket, small lifestyle and budget tweaks are unlikely to make much of a difference. “There’s no amount of budgeting that’s going to make an insufficient income feel sufficient,” Tassin says. She suggests that individuals in this position would be better served by seeking higher-paying work, “in whatever way that [works] for them”.In the second bucket are those who have a decent income, but spend too much on large, fixed expenses, like rent or car payments. Ideally, Tassin says, housing costs should not exceed 30% of net income. This can be difficult in expensive cities, she concedes, saying: “This is why roommates are really valuable.” Similar to individuals in the first bucket, people in this bucket will not be helped by small budgeting tweaks. Rather, they would best be served by finding ways to reduce their biggest expenses, perhaps by downsizing where they live, splitting rent with a roommate or getting a cheaper car.The last group is the target of most mainstream budgeting a
Gio. Gen 16th, 2025
