Managing personal finances effectively is essential for achieving financial stability and meeting long-term goals. Various budgeting methods offer structured ways to handle money, each tailored to different spending habits and financial objectives.

This article will explore four popular budgeting methods: the Envelope System, Zero-Based Budgeting, the Pay Yourself First approach, and Proportional Budgeting (50/30/20 rule). Each method provides unique benefits and can be implemented to suit individual needs, whether you’re looking to curb overspending, enhance savings, or align your spending with your financial goals.

Four Popular Budgeting Methods

1. Zero-based Budgeting

Zero-based budgets account for every dollar. Your income minus your expenses should equal zero. However, this doesn’t mean you want to spend every dollar. This strategy also accounts for money you save or invest.

Zero-based budgeting is excellent for those who understand their spending but want to know how much money is funding each expense. This budget also helps you see where to cut back and save more.

How the Zero-Based Budgeting System Works

1. Justification of Expenses: Unlike traditional budgeting, which often modifies the previous year’s budget to make adjustments, zero-based budgeting starts from scratch — every dollar spent needs to be justified as if the budgets were being created for the first time.
2. Identification of Needs: Departments aren’t given money just because they spent it last year. Instead, they must justify each of their expenses as necessary for operation.
3. Prioritization of Spending: Funds are allocated based on how essential the expenses are to the organization’s goals. This process forces companies to prioritize expenses, which can lead to more strategic decision-making.
4. Cost-Benefit Analysis: Each department evaluates the cost-effectiveness of different spending areas and proposes its budget based on detailed needs and benefits analyses.
5. Approval and Revision: Top management reviews the proposed budgets and adjusts them as needed to align with the organization’s financial capabilities and strategic objectives.

2. Envelope System

Envelope budgeting is choosing how much money you spend in specific categories and putting it aside in real or virtual envelopes. Each envelope contains the entire amount of money available to spend on that expense for the month.

The goal is to keep your spending in check by only spending the money in each envelope. When the envelope is empty, you shouldn’t spend any more money on that category until next month, when you refill the envelope.

How the Envelope Budgeting System Works

1. Budget Categories: You start by defining your monthly budget categories, such as groceries, entertainment, utilities, transportation, etc.
2. Envelope Preparation: You prepare an envelope for each category and label it accordingly.
3. Allocating Money: After you receive your income, you allocate a predetermined amount of cash to each envelope based on your budget plan. This amount is what you can spend for that category for the month.
4. Spending: Use the cash from the respective envelope when you need money. For example, buying groceries takes money from the “groceries” envelope.
5. Monitoring and Adjusting: Once an envelope is empty, you can’t spend any more in that category until the next budget cycle begins. If there’s money left over, it can be saved or reallocated to other categories.

Using an online budgeting app is much easier than physically putting cash into many different envelopes (safer, too). Rocket Money is the budgeting app I use to track my expenses, set reminders to pay certain bills, and build my budget. You can also use the envelope method with Rocket if you subscribe to their premium features. The cost is $4 a month (well worth it for me)

3. Pay Yourself First

Paying yourself first is precisely what it sounds like. You fund your savings and investing goals first and then fill in the rest of your budget.

If you have a trip coming up in 10 months that will cost $1,000, you start each month by allocating $100 into your travel account and allocate funds to your other savings and investing goals.

How the Pay Yourself First Budgeting System Works

1. Identify Savings Goals: Identify your financial goals, such as saving for retirement, accumulating an emergency fund, or setting aside money for a large purchase.
2. Determine Savings Amount: Decide on a specific amount or percentage of your income that you want to save. This should be based on your financial goals and what you can realistically afford while meeting your basic needs.
3. Automate Savings: Set up automatic transfers from your checking account to your savings account, investment account, or retirement fund as soon as you receive your paycheck. This ensures that the designated amount is saved before you can spend it.
4. Budget Remaining Funds: After your savings have been automatically deducted, use the remaining money to cover all other budget categories like housing, utilities, groceries, and entertainment.

4. 50/30/20 Budget

Proportional budgets look less at specific categories and more about where your money should go. The two most common ones are the 50/30/20 rule and the 80/20 rule.

How the 50/30/20 Budgeting System Works

1. Divide Income into Categories:
   • 50% Needs: This portion of your income covers essential expenses you cannot avoid, such as rent or mortgage payments, utilities, groceries, transportation, health insurance, and other debts.
   • 30% Wants: This part includes all non-essential expenses you could live without if necessary. These might include dining out, entertainment, vacations, luxury items, and other discretionary spending.
   • 20% Savings: This final portion is allocated to your financial future, including savings, investments, retirement funds, and debt repayments beyond the minimum payments included in the needs category.
2. Apply and Adjust: After categorizing your income, apply these proportions to manage your monthly finances. You can adjust the specific percentages based on your financial goals and circumstances, such as focusing on paying down debt faster or saving for a large goal.

The 80/20 budget is simple–you live on 80% of your income and save the other 20%. These are great for people wanting a less restrictive budget.

Why Should You Budget?

Budgeting helps you achieve short- and long-term financial goals. If you plan a trip for next year and use credit cards to pay for it, budgeting can help you avoid that. Every month, sock away a little for that trip, and before you know it, you’ll be able to afford it without going into debt.

Budgeting is also a critical tool for financial management, serving as a roadmap that guides individuals and businesses toward fiscal stability and success. By meticulously outlining where money should be spent and how much should be saved, budgeting helps avoid the pitfall of living paycheck to paycheck. It ensures that every dollar is allocated purposefully, helping to curb unnecessary spending and prioritize essential expenses.

This discipline is crucial for anyone aiming to achieve financial goals, whether maintaining daily operational costs, saving for a dream vacation or preparing for a comfortable retirement. Moreover, a well-planned budget can act as a financial buffer, setting aside funds for unexpected expenses and reducing the likelihood of needing to incur debt.

Tips for Successful Budgeting

Sticking to a budget can be difficult because we don’t like telling ourselves “no,” and budgeting can feel like that at first. 

When you’re struggling and want to spend money on something you don’t need, you can remind yourself, “I’m saying no now to say yes later.”

Here are some quick tips for creating and sticking to a successful, stress-free budget:

• Have a goal so that budgeting seems like a tool and not a constraint
• Be realistic and set goals that are feasible on your income
• Try different methods and find the one (or two) that works best for you
• Don’t be afraid to change your budget as your life and priorities change

Final Thought on Different Budgeting Methods

Budgeting should be a tool and not a limitation. It may be helpful to think of it as a spending plan. You’ll always have a money goal to work towards buying a home, replacing a vehicle, paying off debt, saving for a vacation, replacing broken appliances or furniture, and even paying a medical bill. The list is endless. So, the point is that you don’t want to budget and stop once you reach one goal. You want to keep going and work towards another goal on your list.

Choosing the right budgeting app and method can transform your financial life, offering a structured path to achieving your economic goals. Whether it’s the hands-on control of the Envelope System, the meticulous scrutiny of Zero-Based Budgeting, the disciplined saving of the Pay Yourself First approach, or the balanced allocation of the Proportional Budgeting method, each strategy offers unique advantages tailored to different financial needs and lifestyles.

By understanding and applying these methods, you can gain greater control over your finances, reduce financial stress, and move confidently towards a more secure and prosperous future. Remember, the best budgeting approach is one that you can stick with consistently—so choose wisely, adjust as necessary, and take that first step toward mastering your financial destiny.

The post 4 Popular Budgeting Methods – Which One Works Best for You? appeared first on Doughroller.

Even more important is sticking to and maintaining a stress-free budget. It’s not enough to create a budget one day, follow it for a few months, and then think you’re healed. A budget is an ongoing financial process that should last your entire life, and keeping it as stress-free as possible ensures it lasts a good long time.

I will outline five important things you can do when creating and using your budget to give you the best chance to keep it going.

1. Start Your Budget with Clear Goals

Define what you want to achieve with your budget, whether paying off debt, saving for a vacation, or simply ensuring you don’t spend more than you earn. Clear goals give your budget purpose and help you stay motivated.

Direction and Motivation: Whether aiming to reduce debt, save for a big purchase like a house or a car, or ensure everyday financial stability, having a defined objective helps you stay motivated. When you know what you’re working towards, making the tough decisions to restrict spending in certain areas is easier.

Measurable Outcomes: Goals make the abstract concept of “saving money” tangible and measurable. You can easily track your progress by setting specific targets (like saving $200 monthly towards an emergency fund). This provides a sense of achievement as you reach milestones and allows you to adjust your strategies if you find you’re not on track.

Prioritization of Resources: Knowing that you want to pay off $10,000 in student debt within five years can help you decide how much money to allocate to debt repayment versus other expenses. This prioritization ensures that your spending and saving patterns align with your most important financial objectives.

Decision-Making Framework: When faced with financial choices, you can refer to your goals to guide your decisions. This can be particularly helpful in avoiding unnecessary spending. For example, if your goal is to save for a vacation, this might motivate you to cook at home rather than dining out.

Long-Term Vision: Goals encourage a long-term outlook on your finances, essential for building wealth and financial security. Setting short-term (saving for holiday gifts) and long-term (retirement savings) goals ensures that your budget addresses all aspects of your financial health.

Stress Reduction Tip #1: Knowing what to do financially to meet your goals can significantly reduce stress. Uncertainty about where you stand financially often leads to anxiety; clear goals and a structured budget can alleviate this by providing a predictable path forward.

2. Always Use the Right Tools (and Apps)

Use intuitive and easy-to-use tools, such as a simple spreadsheet, a budgeting app like Rocket Money or YNAB, or a pen and paper. The less hassle you have logging your expenses and income, the more likely you are to stick with your budget.

Efficiency: The right tools can make tracking your income and expenses much more efficient. Modern budgeting tools often automate data entry and categorization, pulling information directly from your bank accounts and credit cards. This reduces the time you spend manually inputting data and minimizes errors, making the budgeting process quicker and more accurate.

My personal budgeting app of choice is Rocket Money. With Mint’s closure, I moved to Rocket Money roughly six months ago and quickly integrated all of my accounts with their platform. Connecting accounts was easy, and I pay just $4 a month for their premium service.

Customization: Everyone’s financial situation is unique, so a tool that works well for one person might not be the best choice for another. The right budgeting tools will offer customization options that allow you to tailor your budget to your specific financial goals and lifestyle. For instance, if you have variable income (like that from freelance work), you might prefer a tool that can adapt to fluctuating monthly earnings.

Real-Time Tracking and Alerts: The best budgeting apps provide real-time updates on your spending and alert you when you’re approaching your budget’s limits. This can help prevent overspending and allow you to adjust your spending on the fly, which can be useful for staying on track financially.

Insightful Reporting: Intuitive tools often have powerful analytics to help you understand your spending habits over time. They can generate reports that show trends in your expenses, savings, and other financial metrics. These insights can be invaluable for making informed decisions about your finances, allowing you to identify areas where you can cut back or need to allocate more resources.

Integration: Top-of-the-line budget software will integrate smoothly with other financial tools and platforms you use. This might include your bank, investment portfolios, or debt management tools. Integration can provide a comprehensive view of your financial health, making it easier to see the big picture and make strategic decisions.

User Experience: An intuitive and easy tool is more likely to be used consistently. If the interface is clunky or the process is too complicated, you’re less likely to keep up with your budgeting. On the other hand, a tool that fits well with your tech-savviness and personal preferences encourages regular use and can make budgeting a less daunting task.

Accessibility: What happens if you’re on vacation and alerted of a charge you didn’t make? Accessibility ensures that you can always check in on your financial status, update your budget, and make changes as needed, no matter where you are.

3. Automate Everything You Can

Set up automatic transfers to your savings account and automate bill payments where possible. Automating these processes reduces the mental load of remembering to make transfers and payments.

Consistency in Saving: Automation makes saving money effortless. By setting up automatic transfers to your savings or investment accounts, you ensure that a portion of your income is saved before you have a chance to spend it. This “pay yourself first” strategy is highly effective because it removes the temptation to skip savings in favor of unnecessary spending.

Avoiding Late Payments: Recurring bill payments can help avoid late fees and penalties associated with missed due dates. It also maintains your credit score, as on-time payments are a significant factor in its calculation. Once set up, you don’t have to remember every bill’s due date, reducing mental clutter and financial risk.

Budget Discipline: By automating your essential expenses and savings, you create a system that operates on your budget’s principles without your ongoing input. This leaves less room for impulse purchases and helps maintain your financial goals even during periods of low personal motivation.

Time Efficiency: The time you spend paying bills, transferring money to savings, and managing routine financial transactions can be used for other activities, whether productive or purely recreational. This can make the personal finance management process more efficient and less time-consuming.

Optimized Cash Flow: Automating your finances allows you to synchronize your cash inflows and outflows better. For example, scheduling bill payments shortly after your payday ensures you cover your essential expenses first. This optimization can help prevent situations where you might be short of funds when needed most.

Building Financial Resilience: When consistently saving and investing without manual intervention, you build up financial reserves and assets to support you through economic downturns or personal financial emergencies.

Stress Reduction Tip #2: Knowing your critical financial tasks are handled automatically can significantly reduce stress. You won’t have to remember due dates and transfer amounts, freeing up mental space for other more important or enjoyable tasks. This peace of mind is one of the significant hidden benefits of automation.

4. Keep Your Budget Simple

Don’t create an overly complicated budget that you can’t follow. Start with broad categories (housing, food, transport, and leisure) and adjust as necessary. This simplicity will make tracking and maintaining your budget easier without feeling overwhelmed.

Increased Likelihood of Adherence: A simple budget is easier to follow. Complicating the budgeting process with too many categories or overly detailed tracking can become overwhelming, which might deter you from sticking to it consistently. In contrast, a simple budget makes it easy to see where your money is going at a glance, encouraging regular use and adherence.

Ease of Understanding: Simplicity ensures you can quickly understand where you stand financially. When a budget is easily interpreted, you’re more likely to make informed decisions quickly. This is particularly helpful in everyday situations where you might need to make swift decisions about spending or saving.

Flexibility: When you start with a few broad categories, adjusting these is easier as your financial situation changes without overhauling the entire system. This flexibility can be especially beneficial during financial uncertainty or when you experience significant life changes (like a new job or moving to a new home).

Reduces Mental Load: Keeping the budget simple reduces the cognitive load involved in financial planning. The less time and mental energy you spend figuring out your finances, the more you can focus on other aspects of your life. This can reduce stress and make managing your money a less daunting task.

Quick Setup and Maintenance: You can often get started with just a few clicks in a budgeting app or a few entries in a spreadsheet. The ease of maintenance ensures that updating your budget doesn’t become a chore you dread but rather a quick check-in that’s part of your routine.

Facilitates Problem Identification and Solving: When your budget is simple, it’s easier to identify areas where you’re overspending or might need to cut back. Complex budgets can obscure these issues under layers of data and categories. Simplification helps highlight financial habits that may need adjustment, allowing quicker intervention.

Motivational: Seeing direct results from broad categories can motivate you to continue good financial practices. For example, seeing your savings grow in a “travel” category might encourage you to keep finding ways to save more money.

5. Review and Adjust your Budget Regularly

Your income and expenses will change over time, and so should your budget. Regularly review your monthly or quarterly budget to ensure it still fits your needs and adjust it as your financial situation changes. This flexibility can help prevent stress caused by sticking rigidly to a budget that no longer reflects your reality.

Adaptation to Changing Circumstances: Your financial situation can change due to various factors—changes in income, unforeseen expenses, new financial goals, or life events like marriage, having children, or retirement. Regular reviews allow you to adjust your budget to reflect these changes, ensuring it always aligns with your current financial reality.

Prevention of Budget Drift: Even the best-planned budgets can drift away from their intended targets over time. Regular reviews help catch this drift early. For example, spending in certain categories, like dining out or entertainment, gradually increases without conscious intent. Regular check-ins allow you to identify and correct these deviations before they become entrenched habits.

I like to stop by Cumberland Farms and pick up a coffee when I can. Last month, my budget apps showed me I purchased 18 coffees for $34, which was a dozen more than the previous month. I had no idea I was making so many trips!

Optimization of Spending: As you track your spending and review your budget, you’ll identify areas where you can save money. Perhaps certain expenses, once deemed essential, are no longer necessary, or you might find more cost-effective alternatives for services and goods you regularly use. Regular adjustments ensure that every dollar you spend is used as efficiently as possible.

Enhancement of Financial Goals: Your priorities might change over time, requiring shifts in allocating your resources. Regular budget reviews allow you to reassess your financial goals—like saving for a home, investing in education, or preparing for retirement—and adjust your spending to support these goals better.

Improvement in Financial Awareness: Consistently reviewing your budget enhances your awareness of your financial habits and tendencies. This increased awareness can lead to better financial decisions, such as avoiding impulsive purchases or recognizing the need for an emergency fund.

Encouragement of Financial Discipline: Regularly reviewing and adjusting your budget reinforces financial discipline. It becomes a routine check that holds you accountable for your financial decisions and encourages you to control your finances.

Facilitation of Long-Term Planning: With regular updates, your budget becomes a dynamic tool that manages your current financial status and helps you plan for the future. Adjusting your budget to account for long-term goals ensures that you always work towards these objectives, whether five, ten, or thirty years away.

Stress Reduction Tip #3: Keeping a regularly updated plan to reflect your financial situation can reduce stress. It provides confidence that you are on track to meet your financial goals or, if you’re off track, that you have identified this issue and are making adjustments.

Final Thought on Creating a Stress-Free Budget

Watching the money come in can be fun, but watching the money go out can be stressful. Over time, the inclination is to slowly fade out of caring until you get a credit card bill in the mail that shakes you back into budget mode. This teeter-totter of caring about your day-to-day spending continues until the day you retire, and sadly, a lack of focus can cost you hundreds of thousands of dollars.

Pay attention. You don’t have to monitor every penny that crosses your path, but you do have to stay mindful of the monthly, annual, and overall picture. A smart set-up today with very light elbow grease will keep your budget humming for years.

The post 5 Simple Ways to Keep a Stress-Free Budget appeared first on Doughroller.

Unfortunately, we’re still not accustomed to YNAB’s month-ahead spending goal. That means our checking account ebbs later in the month, and we must be more careful. This is especially true because some bills get paid with my freelancing income, which can happen at unpredictable times. We’ve struggled to track our cash flow.

This has often caused us some real problems for the past several years. For example, “We don’t get paid until Friday, and we have $11 to spend the entire week”-these are some problems. If you’ve ever been there, I have a possible solution: Google Calendar.

After messing with several potential solutions, we finally found one that worked well for us. If cash flow is your major budgeting issue, here’s a step-by-step guide for using Google Calendar to track your cash flow easily.

1. Set up a calendar just for your budget

If you don’t already have one, you must sign up for a Google account. As soon as you have your Gmail address, you’ll have access to Google’s calendars. To find it, go to calendar.google.com.

Even if you’ve never used Google Calendar, you’ll have one that automatically populates based on your email address. This is your default calendar. It shows up on the left-hand side of your calendar display.

To create a new calendar for your budget, click the arrow to the right of “My Calendars” and click “Create new calendar.” Fill in the blanks with a name for your calendar, time zone, etc. You don’t have to fill in all the blanks if you don’t want to.

Since this calendar will include some personal financial information, you probably don’t want to make it public. But if you’re on a shared budget, you may want to share it with your spouse or partner. We’ll talk about that in the next step.

2. Share with your spouse, if necessary

My husband has access to this calendar, and I would suggest making it available to your spouse or partner if you’re on a shared income. To share a calendar with someone else, go to the “Share with specific people” section at the bottom of the calendar creation menu.

Type in your spouse’s email address and decide what permission settings to use. If you want your spouse to be able to add to the calendar or change event colors (which will be important later on), choose “Make changes to events.” Then click “Add person.” Once this goes through, click “Create calendar” to begin using your calendar.

This will shoot you back to the main calendar screen, and your calendar will default to show up.

Of course, you must enter some events to make anything appear on the calendar interface. Here’s how to do that.

Additional Resource – The Best Budget Apps for Couples

3. Enter your steady paychecks on repeat

Let’s start with the positive. Begin by entering your paychecks as a repeating event, depending on how you get paid. I’ll show you some examples here that are similar to how my husband’s and my calendar work (with hypothetical numbers, of course!).

First, click on the date of your next paycheck. Let’s say I get paid once a month, on the 15th. I’ll double-click into the 15th of the month, which will open a new event to edit. I title my budget calendar events with the name of the income or bill and the amount.

You may come up with a different naming pattern. But whatever you do, stick to it so it doesn’t become unnecessarily confusing.

I typically save budget events as all-day events because they appear better on the calendar interface. And since there’s probably no particular time associated with budget due dates, you don’t need to worry about assigning them an hour deadline.

Next, you’ll want to set up the event as repeating, assuming you get paid regularly. To do this, check the box next to “Repeat.” Then, set up your repeating parameters. In this case, we say I get paid monthly on the 15th. Just click “Done” when your parameters are correct. Then, click “Save.”

In our imaginary calendar, we will follow these steps to include an every-other-Friday paycheck for my husband. For an every-other-week paycheck, your repeat parameters will look like the following:

As you can see, this parameter automatically makes the event appear on the calendar multiple times a month.

Now that you’ve entered your paychecks, I’ll give some tips below for entering variable income or paychecks that aren’t always the same.

4. Enter your bills on repeat

Now, let’s get to the yucky stuff: bills. This is the main purpose of my budget calendar, so I don’t include variable budget items like groceries or gas here. If you wanted to, you could, especially if you operate on a weekly or bi-weekly budget for items like these.

Create your first bill on its recurring due date just like you created your paycheck events. When I enter bills, I name them in one of two ways. I have some that are auto-debited from my account.

Then there are bills that I have to do something to pay, either by paying online, writing a check, or paying over the phone.

Note that in both styles, the dollar amount is negative. Of course, it’s obvious from the DUE and AUTO indicators that money is going out rather than coming in. But this feels more accurate to me.

As you enter these bills, ensure you correct the repeat dates. I will fill out my calendar with a few bills so you can get a feel for what this all looks like. Here’s a relatively filled-out calendar:

5. Use color-coding for at-a-glance understanding

As you can see from my sample calendar, it’s hard to tell what’s what because they are all the same color. (As a note, your calendar’s default color may differ.) Also, I’m a huge fan of color coding, so I like to do this with my calendar. It’s really easy.

First, open a paycheck event and then switch its color to green. (You can use any color you prefer, but green feels intuitive to me.)

When you click “Save,” the calendar will ask you if you want to edit all the recurring events or just this one. Click “All Events.” This will change all those paycheck events to green.

This will change all those paycheck events to green. Now, you can color-code your other events as you like. In my calendar, DUE events are red, AUTO events are yellow, and all income events are green.

Again, color code in whatever way works for you. Remember that if you aim to code all the events in a series as you set up your calendar, you’ll need to apply color coding to all events in that series.

Additional Reading – The Best Budget Apps

6. Use your calendar to track what’s been paid

You may stop here and use this as an at-a-glance way to track due dates. I use color coding to track what payments have been made or at least scheduled. I’ll often schedule payments ahead of their due date, and I want to see when I’ve done that so that I don’t accidentally double-pay.

To do this, I’ll set an event color to gray each time I schedule a payment or when an auto payment hits my bank account. Changing the color is the same. Just click on the event and select the color you want to use.

However, you should apply this new color to only that event rather than all subsequent events. Otherwise, it will look like you already paid your electric bill months in advance.

Just click the “Only this event” button when you save with your new color.

7. Check in on your calendar weekly

I habitually check in on this Google Calendar at least once a week, and sometimes more, depending on the circumstances. The huge advantage is that I can see which bills need to come out of which paychecks and schedule bills to be paid ahead of time when that’s an option.

Like all budgeting tools, this one is worthless if you don’t regularly use it. So, if you decide to use this option, get into the swing of checking in on your calendar frequently.

A Few Important Points About Tracking Your Cash with Google Calendar

I promised I’d discuss tips for handling variable income, and I have a few other items of note you should also consider.

Variable Income

What if you don’t know when your paychecks will hit? Or do you know when they’ll hit but not how much you’ll get paid?

In the first case, I’d habitually track bills and put in paychecks as soon as I get them. At least you can see which bills are coming up when that paycheck finally does come in.

The second case applies to people who work for commissions and such. In this case, record the date of your paycheck in this slot without an amount. Then, you’ll at least remember that the check is coming, and you may be able to gauge approximately how much it’ll be as the date gets closer. If you have a base pay, record your paycheck income as your minimum base pay so you’ll know at least how much you’ll make for that check.

These aren’t perfect solutions, but they can be a start as you figure out how to customize Google Calendar for your situation.

Personal Information

Some of you may balk at storing personal financial information on a Google platform. And you’re not entirely wrong. While Google is great, it may not be the most secure option globally.

However, I don’t have a huge problem with people knowing how much my bills and income are. You cannot do much with this information, especially since I round up to the nearest dollar and don’t even use the exact amount.

I wouldn’t, however, recommend storing any bank account or even customer account information in your budget calendar. Keep that somewhere else that’s much more secure, or you risk becoming a victim of identity theft or having your accounts hacked.

Notes

That said, storing additional information in your budget calendar could be helpful. For instance, I have to make our car payments over the phone each month, and I have the darndest time keeping track of the number I’m supposed to call.

So, I added that to the description note on our car payment event in the budget calendar. As with color changes, you can apply descriptions to just one or all the following events. This could be a helpful place to record websites and phone numbers used to make your payments. Just avoid storing personal information here, such as account numbers.

Ending Payments

What if you know you only have five months’ car payments left? In this case, when you set up a recurring event, you can set it to end after a certain number of recurrences. So your car payment would drop off your calendar after five months of recurrences.

If you use this technique, I’d recommend toggling through your calendar to find the last payment you’ll make. Make a note in that event’s title to check that your installment loan is fully paid off. Your last payment amount may be slightly below or even above what you’d normally pay, so you want to be sure it’s paid off before it drops off your calendar and out of your mind!

Final Thought on How to Track Your Cash Flow with Google Calendar

Harnessing the power of Google Calendar to track your cash flows offers a streamlined, accessible approach to managing your finances. By setting up this system, you can gain real-time insights into your spending patterns, ensure timely bill payments, and plan for future financial goals—all within a platform many of us use daily.

Whether you’re looking to tighten your budget, save for a big purchase, or keep a closer eye on your expenses, Google Calendar provides a flexible, free, and innovative tool to stay financially organized. Embrace this method, and you’ll find that a well-managed budget is just a few clicks away.

The post How to Use Google Calendar to Track Your Cash Flow in 7 Easy Steps appeared first on Doughroller.

Here’s how the 50/30/20 budget can improve your spending, savings, and financial stability.

What Is the 50/30/20 Budget?

The 50/30/20 budget gives every dollar in your bank account a purpose. This budgeting idea comes from the 2005 book All Your Worth: The Ultimate Lifetime Money Plan by Massachusetts Senator Elizabeth Warren and her daughter Amelia Warren Tyagi.

The 50/30/20 budget organizes your money into needs, wants, and savings.

Half of your paycheck, or 50%, goes toward non-negotiable needs. 30% goes to the fun stuff. And the remaining 20% goes toward savings, investing, and paying down debt.

Too often, budgeting guidance can be unrealistically restrictive and shames frivolous spending. Or some financial advice can lean too heavily on simple platitudes. For example, stop buying a $5 fancy coffee daily and put that amount in a savings account instead.

While this advice isn’t wrong, a more realistic approach may yield better results. A budget should include some indulgence and fun. The 50/30/20 budget leaves room for buying what you want while prioritizing saving and investing. So you won’t feel like you’re on a restrictive financial diet.

How the 50/30/20 Budget Works

Budgets are easily broken. But when you leave room for typical spending, you’re more likely to stick to the plan. 

The 50/30/20 Budget creates an organization template for your monthly income. You’ll know exactly where every dollar needs to go.

Budget 50% of Your Money for Needs

We might think we “need” modern amenities like updated smartphones, Wi-Fi, and a fresh haircut.

But needs will come down to what keeps you alive, employed, and out of jail. Needs can include:

• Groceries
• Utilities
• Mortgage
• Rent
• Car loan
• Gas money
• Car maintenance
• Work clothes
• Childcare costs
• Healthcare insurance
• Copayments
• Credit card minimum payments

If you work from home or are self-employed, having the latest smartphone and the fastest internet may fall under work necessities. In certain work-contingent situations, expenses that seem like “wants” can be classified as “needs.”

Budget 30% of Your Money for Wants

This “wants” section is the special feature of the 50/30/20 budget. It’s a built-in buffer. A significant 30% of your monthly budget goes to non-necessities. 

This extra expense may be a new outfit for the next holiday party or sushi when you don’t like cooking. It can also be for a spontaneous movie date or a Starbucks commute ritual. You can indulge without getting off track if you stick to your 30% limit.

Other “want” purchases might include:

• Vacations
• Tech accessories
• Donations
• Gifts
• Streaming services
• Plants
• Home Decor
• Gym/club memberships
• App subscriptions

Any expense that isn’t necessary for survival or paying off debt is likely a candidate for the “wants” category.

Budget 20% of Your Money for Savings

The smallest chunk of your money is set aside for savings. We’re generally using the term “savings” here. This money can also be used for retirement investing and paying off debts faster.

How you divide your savings budget is up to you. You can begin by building your emergency fund. Put three to six months’ monthly expenses in your emergency fund and keep them there.

Your excess savings can pay off any high-interest debt, like credit cards. Check out our list of best savings accounts for ideas on where to stash your emergency fund.

If you’re not already sending a portion of your paycheck to a retirement fund, consider getting a 401k or IRA. Then, you can send 10% to your emergency fund and 10% to your retirement account. You can also send a higher percentage to your savings to build your emergency fund faster. The choice is yours. 

Helpful 50/30/20 Budgeting Tools

Using a budgeting app increases the chances of sticking to it. Research shows that the instant feedback consumers receive from their budgeting apps helps them manage their financial goals. 

We’ll highlight some of the best budgeting apps below.

YNAB

YNAB, or You Need a Budget, can streamline your finances into an easy-to-follow budget. Even if you have multiple income streams spread out among different bank accounts. The app can support a 50/30/20 budget with its smart categorization feature to divide expenses into wants, needs, and savings categories. 

As the app learns your expenses and budgeting goals, it can automatically recognize and categorize your spending. You’ll receive a free trial of YNAB for 34 days to see if this is the budgeting platform for you. After the trial, a subscription costs $14.99 per month or $98.99 per year.

Read our YNAB Review

Tiller

For those who truly appreciate the unmatched orderliness of a spreadsheet, Tiller is the budgeting app for you. It offers a simple spreadsheet design. You can fully customize your budget and easily set up a 50/30/20 budget system. Use a community template if you don’t feel like tinkering with the spreadsheet. 

You can link all your financial accounts so your Tiller spreadsheet updates automatically and gives you feedback on your total financial picture. Tiller Money is free for 30 days, then $79 per year.

Read our Tiller Review

Simplifi

Backed by fintech giant Intuit, Simplifi connects all your bank, investment, and retirement accounts. Your dashboard is your control center, so you can quickly assess your finances and stay on your budget. Their customizable categories can be personalized to match a 50/30/20 budget setup. 

The app also offers helpful insights to highlight how small changes can help you realize financial goals in the future. Simplifi costs annually or per month.

Read our Simplifi Review

What if I Can’t Afford To Follow the 50/30/20 Budget?

The beauty of the 50/30/20 budget is that it’s percentage-based instead of relying on static numbers. This allows people in any income bracket to start a budget plan.

However, you may find that you can’t follow a 50/30/20 budget if most of your income goes toward absolute necessities. 

To calculate if the 50/30/20 budget works for your financial situation, comb through your last full bank statement. Add up the total amount of deposits or your standard monthly income. 

Then, find the total expenses that are absolute necessities. Figure the percentage you spend on necessities by dividing your necessary expenses by your monthly income. Multiply this number by 100.

For example, if you make $5,000 per month, and your needs total $3,000:

3,000/5,000 = 0.6

0.6×100 = 60% of your income goes toward the “needs” category.

How to Lower Your Needs Percentage

Don’t give up if your necessary expenses total more than 50%. But you will need to get creative. Two ways to get your absolute necessary expense percentage down are to:

• Find a way to increase your income through a side hustle or a new job.
• Find cheaper options for your absolute necessities. This might include buying generic groceries instead of name brands, trading in your vehicle for a vehicle with a lower monthly payment, or refinancing your mortgage for a lower APR.

Using a budgeting app can also help you evaluate your spending habits in the “wants” category. Then, you can make more informed spending choices from now on.

50/30/20 Budget Alternatives

If the 50/30/20 setup is unrealistic for your budget right now, you could view it as an attainable goal while you increase your income or decrease your necessary expenses.

In the meantime, you can still take charge of your budget with one of the following proportional budget systems.

80/20 Budget

The 80/20 budget is the simplest way to practice proportional budgeting. It removes the need to track your expenses throughout the month. You also won’t need to put any thought into which purchases are necessities and which are wanted. The 80/20 budget breaks down like this:

• 80% of your monthly income goes toward all expenses, necessary and superfluous
• 20% of income goes into savings

If you immediately move 20% of your paycheck into savings when you get paid, you’ve done all the legwork this budgeting method requires. Of course, you should check your bank account often enough to make sure you don’t overdraw.

70/20/10 Budget

The 70/20/10 stands out from other percentage-based budget types for its aggressive approach to paying down debt. The 50/30/20 and 80/20 leave an open suggestion to pay down debt if you have room in the 20% savings section. But the 70/20/10 dedicates a separate category to it.

The 70/20/10 works the following way:

• 70% of income goes to living expenses and wants
• 20% of income goes to savings
• 10% of income goes to paying down debt

This is the ideal budget plan for people who are burdened by high-interest-rate revolving credit. Hacking away at debt every month puts you in a position to be debt-free. Once that happens, you might transition to the 80/20 or 50/30/20 budget.

Frequently Asked Questions (FAQ)

Final Thoughts

When left unsupervised, dollars tend to dwindle without notice. But a budget gives your money a mission to improve your financial standing.

The 50/30/20 budget is one money management route to get there. With the help of budgeting apps, you can easily start tracking and organizing your money as soon as your next paycheck drops.

With this proportional budget plan, you can secure your financial future without sacrificing fun spending. The bottom line is that the 50/30/20 budget has some advantages as a starting point, but like most financial rules of thumb, it can also lead you astray.

The post Is the 50/30/20 Budget a Good Rule of Thumb? appeared first on Doughroller.

The decision to combine finances with your spouse can pave the way for a harmonious partnership, fostering transparency and shared goals, or it can lead to discord if not navigated wisely. Understanding the key factors in this process is essential for couples looking to build a stable and prosperous future together.

Couples must deliberate on several aspects before plunging into shared financial waters. From assessing individual financial habits and obligations to setting mutual goals, the process requires a level of openness and honesty that may not have been previously tested.

These considerations are not just about the logistics of merging bank accounts or splitting bills; they’re about aligning values, priorities, and visions for the future. In this context, we will explore nine important points couples should consider when combining their finances, ensuring that this critical step is taken with both eyes open and a shared understanding of the path forward.

Things to Consider When You Combine Finances With A Spouse

1. Know where you stand financially

Before you combine your finances with someone else, you must clearly understand your personal finance picture. How else can you have a meaningful conversation about your new financial life together if you don’t know what’s happening with your money? The amount of information your new partner will want largely depends on their personality.

Here are a few questions you might want to ask yourself before you have the money talk:

• Do you have credit card debt?
• Are your debts on one card or ten?
• How about student loans, auto loans, or a mortgage?
• Do you pay them on time?

What about savings and retirement planning? Are you sitting on a large stash and counting the days until financial independence? Are you drowning in consumer debt and wondering when you can file for bankruptcy (maybe even again)? Or is it something in between?

2. Why do you want to combine finances?

While this may seem like a silly question, many people don’t take the time to think this part through. They jump into how to combine finances without ever considering the why. Articulating the reasons you want to combine finances may not change your decision. But it can help you get in the right frame of mind and may ease the process.

Are you combining finances because you think you must? Maybe you’re doing it because that’s how your parents did it. Perhaps you’re considering it at your partner’s (or someone else’s) insistence.

3. Benefits and drawbacks

Maybe you’re not even sure you want to combine finances. There are certainly some pros and cons to both sides of the argument.

The biggest pro to the joint finances argument is probably convenience. Combining money generally means having at least one joint bank account. Having a joint account means that either or both of you have access to all the money in the account all the time.

This can make things like paying for groceries and other household expenses nice and easy. You no longer have to discuss who will pay or how to split the bill.

The potential benefit of having a joint account is that both partners have equal access to the money. The potential downside of having a joint account is that both partners have equal access to the money.

4. Are you both comfortable with each other’s financial situation?

Often, revealing the details of your financial life to another person can make you feel vulnerable. This can make the money conversations difficult at first.

Opening up your books to your partner and taking stock of each other’s finances is only part of the equation. Once you have laid all your cards on the table, you must decide whether you are comfortable with each other’s financial situations.

Maybe your partner still has six figures of student loan debt, and you have a million dollars in retirement accounts. Or perhaps you’re both debt-free but have no savings. What about your financial and life goals?

It is important to ensure you can get on board with each other’s plans. Life will look much different for two individuals working full-time and aiming to retire early than two people with summers off looking to take month-long adventures every year. Even if you don’t have the same goals, ensuring those plans are compatible is important.

It doesn’t matter what individual pieces you both bring to the table. Ultimately, you both need to be comfortable with the new picture that takes shape when you start to put those pieces together.

5. Are your money-handling styles compatible?

Maybe you’re worried because you are a saver and the other a spender. (This is much more common than you might think.) Maybe one of you is a Type A personality, and the other isn’t sure what day it is.

As the saying goes, personal finance is very personal. So, as you might expect, we all have our habits and techniques for handling money. In this regard, there are a lot of things to consider.

Do you both budget every penny? Maybe you check your account statements for a few minutes each month. Likely, it’s something in between.

Learn More: A Simple Approach to Budgeting

Having different money styles is normal and is generally not a cause for concern. The real sticking point will be whether your two styles can coexist in a way that works for both of you.

6. How will you divide up the jobs?

So, you’ve decided you are comfortable with each other’s financial pictures. You’ve identified each other’s money-handling styles and decided you will do the whole two become one thing. You’re done.

Nope. This is where the how comes in. All those big and little details still need to be figured out. Here’s a table that might help you figure out who is going to be responsible for what.

Which of you will write the checks and lick the stamps regarding bills? (Or, for those living in modern times, which of you will monitor the electronic bill payments?) How about keeping track of the daily personal and household expenses? Will you even track them? What if you both love creating and updating spreadsheets!?

Read About Setting Up a Cash Flow Calendar

7. Which accounts will you keep?

I call this the “Do we need two toasters problem.” When combining households, most people combine their belongings as well. It is not uncommon to end up in a situation where, after the dust settles, you have a lot of redundancy in the things you own. Do you keep your toaster or your partner’s toaster? Or do you throw them both out and buy a new toaster that you pick out together?

Combining finances often results in the same type of situation. Which means you also have a lot of choices to make. In short, how will you figure out which accounts to keep, which to close, and whether to open any new accounts?

Bank Accounts

As you might expect, there are a few schools of thought on combining bank accounts.

Ours: Some people feel that having only one joint checking and one joint savings account for the household is the only right way to combine finances. Some of the advantages of a system like this are simplicity and equality. If you have one account, there is no question about where the money goes when it comes into the household, and both partners have equal access to use that money.

Mine: Others prefer to go the opposite route and keep all bank accounts separate. In this system, household expenses are divvied up in some manner, leaving each partner responsible for their share of expenses and free to manage their accounts. In marriage situations, this is more commonly seen in second (or third) marriages or unions where one or both partners are older and more set in their ways financially.

Additional Resource: The Best Savings Accounts of 2024

This system is not without its drawbacks, however. Unlike the shared account system above, the separate nature of this system can create financial hurdles if one partner needs access to the other partner’s accounts, especially in times of job loss or serious health issues.

Yours, Mine, and Ours: Another way to tackle this issue is to use a hybrid system. Each partner has a separate account into which their income is deposited, and a household has a joint account with both partners named on the account. Each partner transfers money from their accounts into the household account, and all household expenses are paid from the joint account. This leaves each partner with an intact sense of autonomy and control over their finances while allowing for more convenient management of the day-to-day household expenses.

Credit Cards

Generally speaking, the same systems that can be used for bank accounts can also be used for credit cards. That being said, decisions regarding credit cards should be made with care as credit because opening and/or closing them can impact your credit.

If keeping your credit scores intact is one of your goals, consider both partners keeping all their cards open. That is because closing accounts can negatively impact your credit score, reducing your available credit (which can affect your utilization ratios) and your average age of accounts.

If you also want to have the simplicity of the one-account method, there are a few ways to handle that. The obvious solution might be to open up a new credit card account as joint cardholders. In that scenario, you would be legally responsible for all debt accumulated on the new card, which would appear on both partners’ credit reports.

The other way is to pick one card held by either partner (maybe the one with the best cashback, best airline mile earning potential, or lowest interest rate) and add the other partner as an authorized user on the card. Unlike a joint owner, typically, an authorized user has permission to spend on the card but is ultimately not responsible for paying it back.

Remember that in a marriage situation, state community property laws can affect this significantly. By adding an authorized user, you avoid the temporary hit to your credit that comes with an application for a new card, and you keep the number of accounts you have (and have to keep track of) from growing.

8. How will you track your finances?

Whether you keep one account or many, you will need some system to know where your money is and what it is doing. Thankfully, nearly all of the tools available for tracking your cash can be used for households just as well as one person and the we’ve highlighted two of the best budget apps for couples.

Rocket Money

Rocket Money is a comprehensive budgeting app with features that effectively manage personal and couple finances. It provides expense tracking, budgeting, bill negotiation, subscription management, and credit score monitoring.

With both free and premium plans, Rocket Money caters to a wide audience, claiming to have saved its customers over $1 billion. The app also integrates with Rocket Mortgage and Rocket Loans, offering unique benefits like a credit card with rewards towards home purchases or mortgage payments. Users highly rate it for its diverse services and ease of use.

• Monthly Cost – FREE for the basic version of $4-$12 per month for Premium

Read our Rocket Money Review

Empower

Empower is a financial management platform that offers a free Personal Dashboard and a Wealth Management service for more in-depth investment management. Serving nearly two million users, Empower provides extensive investment tools, even in its free version, such as asset aggregation, budgeting, and cash flow analysis.

The wealth management service, catered to clients with significant assets, offers personalized investment strategies and access to financial advisors.

• Monthly Cost – FREE

Read our Empower Review

9. Nothing is set in stone

Maybe you decide all these things upfront, or maybe they happen. Regardless, every financial partnership has some amount of delegating and co-managing. It’s just a matter of finding the balance.

That being said, it can be wise to reevaluate things occasionally to make sure you are both comfortable with how things are going. If not, you can use the power of teamwork to come up with a new plan!

Should You Combine Finances With Your Spouse?

Combining finances with a spouse is a highly personal decision that depends on each couple’s unique circumstances, values, and financial goals. While merging finances can foster a sense of unity and simplify money management, it is crucial to have open, honest discussions about each partner’s financial habits, goals, and expectations before making such a decision.

Establishing clear communication and mutual understanding can help mitigate potential conflicts. For some, maintaining separate finances or adopting a hybrid approach may offer the flexibility and autonomy they desire. Ultimately, whether or not to combine finances with a spouse should be a collaborative decision that supports the couple’s overall financial health and relationship harmony.

The post Should You Combine Finances with a Spouse? appeared first on Doughroller.

Even if you’re not currently on a bare bones budget, you may want to go ahead and write out what your essential budget would look like right now. If you lost your job, how much money would you have to pay each month to keep the lights on and food on the table?

Why do you want to know this figure even if you’re ripe with extra cash? For one thing, it helps you set your emergency fund target. Too often, people think an emergency fund should be three to six months of net income.

Though, in a true emergency, you’d likely be able to cut back your expenses — sometimes dramatically, so you want to set your emergency fund goal, at first, for three to six months’ worth of essential expenses.

Unless you only pay out essential expenses, you must know your bare-bones budget. Here’s how you figure that out:

How to Create a Bare Bones Budget

Start With the Four Walls

Here at Dough Roller, we’re not necessarily on board with everything Dave Ramsey preaches, but his four-wall concept for budgets is pretty solid. The four walls are the things you must pay for to keep living. As Dave Ramsey lists them, the four walls are food, shelter, clothing, and transportation.

Here’s the thing: your budget for your four walls may look different from my own. So, it would be best to consider how it would look to strip these essentials back to their minimums in your particular situation. Let’s do a quick case study of the four walls for my own family.

For my family, the four walls would include groceries, a mortgage payment, utility payments, one vehicle’s gas and expenses, a monthly bus pass, essential medical expenses, and basic clothing for myself, my husband, and our two kids. Dave Ramsey’s four walls don’t explicitly mention medical expenses, but certain medications must be filled monthly.

Those expenses would look something like this:

• Groceries: $400/month
• Mortgage (including property taxes and insurance): $1,730/month
• Utilities: $150/month (average)
• Car Maintenance, Insurance, and Registration: $150/month
• Gas: $100/month
• Bus Pass: $30/month
• Basic Clothing: $50/month
• Medical Expenses: $50/month
• Total: $2,660

Our current budget doesn’t look much like this at all. We spend a bit more on convenience foods, but we could cut back if we had to. Our mortgage would stay the same, but we could be less comfortable saving on utilities. (i.e., My husband likes his air conditioning!)

Learn More: How to Earn Cash Back on Groceries

We currently have two cars, one with a monthly payment. But if the worst happened, we could sell that vehicle and use our paid-off vehicle for my husband, who must have a work vehicle. I could take the bus to and from work if I needed to. And our clothing doesn’t have to be very expensive, as my husband and I have fairly casual workplaces, and we buy most of our kids’ clothes secondhand, anyway.

Your four walls might come in much higher or lower than ours, depending on your situation. For instance, maybe you live in an area where walking or busing everywhere is possible. So, if you lost your job tomorrow, you could sell your vehicle and get by without it. Or maybe you must have two vehicles to get both spouses to and from work.

Or maybe you work in a highly formal environment requiring you to have dry-clean-only suits. If dressing this way is essential, budget for more expensive clothes and the costs of caring for them.

The key here is to think carefully about what you would have to pay in this situation if you were cutting your budget as much as possible.

Add in additional essentials

The four walls are a good starting place and should make up the bulk of your bare-bones budget, but you should also consider other close-to-essential expenses you may want to add to your budget. This might include some of the following items, depending on your circumstances:

• Phone or cell phone service
• Internet service (especially if you work remotely)
• Coffee shops (if you rely on them for internet access rather than paying for home internet)
• Home maintenance
• Medical insurance
• Additional insurance policies (such as life insurance)
• Professional association fees
• Daycare
• School tuition
• Haircuts
• Toiletries
• Pet care items
• Cleaning supplies

Many of these expenses could be cut out, if not forever, at least for a long time. But some are pretty close to essential.

For our family, I’d count phone service, internet service, home maintenance, life insurance, daycare, pet items, toiletries, and health insurance among our essentials. Daycare is the largest of those expenses, but we can’t be a two-income family without daycare. If one of us lost a job, we’d want to maintain our spots at our local daycare or risk being unable to find daycare when we find a job again. Here’s what these expenses would look like stripped down and counted monthly:

• Phone Service: $50/month (if we switched to a lower-cost provider)
• Internet Service: $50/month
• Home Maintenance: $50/month for basic upkeep
• Life Insurance: $55/month (we wouldn’t want to lose this coverage!)
• Daycare: $800/month (and that’s cheap!)
• Pet Items: $30/month
• Toiletries: $20/month
• Health Insurance: $250/month
• Total: $1,305

Health insurance is an iffy expense to include here, I think. It depends on why you’re calculating your bare-bones budget. Count your current health insurance costs to cut back on this budget to knock out debt. But if you’re looking at what would happen if you lost your job, consider how your job loss would possibly make available options like government-subsidized insurance.

Again, your next-to-essential expenses probably differ from mine, depending on your situation. The key is to think clearly about how much you would need for expenses like these should you need to cut your budget to the bone.

Steer clear of bankruptcy if you can

What about debt payments? You should include your minimum debt payments if calculating your bare-bones budget to set an emergency fund goal.

Related: How to Get Out of Debt… and Fast

But what if the point of this exercise is to cut your budget back so that you can get out of debt? In this case, you might look at your budget like this: First, pay essential expenses, then put everything else towards debt. In this case, your minimum debt payments (other than those like your mortgage that are part of your four walls) don’t need to factor in. You’ll just put whatever is left each month towards debt.

For me, long-term debts like my and my husband’s student loans would be part of our bare-bones budget. Even if we lost a job tomorrow, we’d do everything possible to pay these debts to avoid negative credit consequences. Minimum credit card or personal loan payments might also factor in for you.

So, if I add minimum student loan payments based on our current repayment plans, that’s $215 monthly.

Add it all together

So, if you want to know your bare-bones budget, add these three figures together. For my family, the total comes to $4,180. And again, some of the expenses I’ve included — such as toiletries and even debt payments — could be stripped or stretched for at least a short period.

With that figure, I could say that the first $4,180 of our monthly income goes toward essential expenses. Whatever is left over can go towards debt. Or I could calculate my emergency fund savings goal- somewhere between $12,540 and $25,080 for the standard three- to six-month expenses.

How to Use a Bare Bones Budget

So, how can you use this budget in your everyday life? You’ve got a couple of options:

• Stick to it. To stick to this stripped-down budget (which I wouldn’t recommend doing for longer than you need to!), consider doing a cash budget. Pay your essential monthly expenses upfront, and then use cash for variable expenses like gas and groceries. Or use a budget app to ensure you stay within range on all these line-item expenses.
• Guide by it. What if you want to use your bare-bones budget as a guide to make sure your spending doesn’t get too out of control in any one area? In this case, write down what you could live on each month, and then start tracking what you do live on.

For instance, say you could feed your family for $300 monthly, but you spend $600. It might be time to look at ways to cut back on grocery spending!

Or, say you could get by without a vehicle if you had to, but your car expenses total $1,000 per month. Is it worth continuing to pay that much for your car payment, maintenance, gas, and more? Or could you find a way to moderate that expense?

Learn More: 4 Budget Types and the Best Tools for Each

Ramsey says you should live on a bare-bones budget while getting out of debt. Sometimes, this is appropriate, especially if you can pay off a big debt in three or four months. However, sustaining this tight budget over the long haul is extremely difficult. Plus, it might defeat the purpose. The goal of managing your money is to give yourself more options and to enjoy life more, not to live like a miser who never enjoys anything!

Writing down your bare-bones budget is a good exercise, though you might not want actually to live on this budget unless you must. But it gives you a place to start when determining your monthly expenses.

A Few Budget Apps to Get You Started

If you’re struggling to create and follow through with a manual budget, you may need some help. If so, plenty of low-cost budgeting apps can help you succeed.

YNAB

YNAB is one of the most popular budgeting apps available. It centers around Four Rules: 1) each dollar in your budget is assigned an expense category, 2) you will anticipate large, occasional expenses, 3) you’ll build flexibility into your budget, and 4) you’ll “age your money.”  Aging your money brings you to a point where you begin paying this month’s bills using money accumulated from the previous months. Once you reach that stage, you’ll move past the paycheck-to-paycheck cycle and gain greater control over your finances.

YNAB is available for a monthly fee of $14.99 or an annual payment of $99 (the equivalent of $8.33 per month).

Read our YNAB Review

Buxfer

Buxfer is one of the most comprehensive budgeting apps available. In addition to budgeting, it also offers forecasting, investment tracking, and retirement planning.

Engaging in international transactions or having foreign-based accounts is especially valuable. That’s because it can work with more than 100 currencies in over 150 countries. It uses a user-friendly question-and-answer format, making it easier for you to access any information you need to manage your finances better.

Buxfer offers three different plan levels:

Monarch Money

Monarch Money starts by having you add all your financial accounts to the dashboard. That includes savings and checking accounts, investments and retirement accounts, loans, and credit cards. You can then set goals, and the app will help you to reach them.

Though it is not an investment service, Monarch Money will provide investment assistance by analyzing your accounts, helping you balance your allocations better, and project future valuations.

Monarch Money is available for a monthly fee of $14.99, or you can sign up for an annual plan at $99.99 – the equivalent of $8.33 per month. It all begins with a seven-day free trial. You can add unlimited household members to the app at no extra charge.

Read our Monarch Money Review

Frequently Asked Questions (FAQ)

The post How to Create a Bare Bones Budget in 4 Easy Steps appeared first on Doughroller.

The problem is that I still need to manage my money. So, what do I do?

I confronted this problem a few years ago and asked myself the following question

How do I effectively manage my money in as little time and with as little pain as possible?

To answer that question I came up with a money management plan that doesn’t require me to track all of my expenses every month and requires a relatively small investment of my time. In this post, I’ll share my plan on how to create a simple budget in under 10 minutes.

Before I get to the steps I take, it’s important to say that you should do what works best for you. You may need to track (or just feel more comfortable tracking) every dime you spend. That’s great if it works for you. You may also want to take my plan and modify it in ways to make it work better for your finances.

Either way, budgeting should be viewed as a means to an end. Budgeting and money management are a way to allow us to spend and save our money most productively and efficiently possible.

If you need 100 expense categories to accomplish that goal, so be it. If you can do it with just 5 expense categories, great! It turns out that I use just one expense category most of the time. Here’s how:

Getting Started: Know Your Expenses

This is one of the biggest obstacles to setting up a budget. You can’t create a budget without knowing how much money is coming in, how much is going out, and where it’s going. The only way to do this is by tracking your past spending habits, and that’s where the whole budgeting process can get tangled.

The best way to determine your expenses is the track them over at least the previous 12 months. The reason for tracking an entire year is so that you will account for all expenses incurred. It’s easy enough to track recurring expenses, like your house payment, debt payments, and fixed utility expenses. But along the way, there are variable expenses, like vacations and car repairs. To set up an accurate budget, you’ll need to account for all these expenses.

To get the most comprehensive picture of your expenses for the past 12 months, analyze the following accounts:

• All checking accounts used during the previous year, including and especially debit card activity.
• Any other accounts you spend money from, such as brokerage accounts that come with a debit card.
• Statements for any credit cards used during the year. Be sure to include any interest expense or other fees incurred.
• Cash expenses – these will of course be difficult to track, so you may need to make a reasonable estimate if they are common in your spending habits.

Analyzing your expenses will be a challenge if you have multiple spending accounts. But that analysis may also make you aware you may be using too many accounts. If so, one of your goals should be to reduce the number of spending accounts to maintain better control of your expenses.

Tracking Your Income

Don’t forget to tally your income as well. If all your income sources flow into your checking account it’ll be an easy job. But you’ll also need to include any payroll allocations going into savings, money markets, brokerage accounts, and especially retirement accounts. If funds deposited into these accounts usually stay there, it will provide you with an indication of how much you’re already saving.

Once you’ve calculated your income and expenses for the year, you can average them so that you can convert your finances to a monthly budget.

With your income and expenses for the past 12 months analyzed and categorized, you’ll know how much you have coming in, how much is going out, and what it’s going out for. That will put you in a position to make decisions about the future direction of your finances.

Save First

You’ve heard the expression, “Pay yourself first.” What this means is that you should first set aside a specific amount from each paycheck to be saved. Then, you can spend the rest. That’s what I do, and my budget looks like this (all percentages are based on gross income):

1. Savings: 15%
2. Spending: 85%

As long as I save 15% of my gross income and spend no more than 85%, I don’t typically care how much I spend on groceries or entertainment or electricity. Unfortunately, though, the fun can’t just stop there.

I have found at least three potentially significant problems with this simple approach.

1. Failing to save as much as you comfortably can;
2. Spending more than you planned to spend; and
3. Getting whacked by periodic or unexpected expenses.

Recognizing these potential problems, I developed a simple approach to address each of them.

Update: My wife and I now save about 70% of our income. It helps that our mortgage is paid off and we live a modest lifestyle compared to our income. I’ve also switched to Empower’s free financial dashboard to manage everything from spending to our investments.

Let’s examine each of the three significant problems in more detail.

1. Failing to Save as Much as You Comfortably Can

How much money should you save? There’s no one right answer to that question. The goal is to achieve a reasonable balance between enjoying today and saving for tomorrow. For me that once meant saving between 10% and 20% of gross income. I view 10% as the absolute minimum goal and 20% as ideal for most individuals and families.

But what if I could comfortably save more? That’s one of the potential downsides to this simple budgeting plan. In and of itself, it doesn’t tell you how much you can reasonably and comfortably save.

To determine that number, I prepare a budget template. I use a simple Excel spreadsheet that divides my monthly expenses into three categories:

• Fixed expenses – mortgage, utilities, telephone, cable, etc.
• Variable expenses – groceries, entertainment, clothing), and
• Periodic expenses – car and life insurance, gifts, vacations, etc.

The fixed and periodic expenses are easy to determine by looking at past bills. If they fluctuate somewhat from month to month, use a 12-month average. The variable expenses can take some time to pull together; if you religiously use a credit card like we do, though, the information is right there in your bank statement. Once again, you can convert these expenses to a monthly amount by averaging them over the past 12 months.

With this information plugged into my spreadsheet, I can get an idea of how much (or how little) I can save. I can also see how making adjustments to my spending will increase or decrease my savings.

What I don’t do is track all of my expenses each month according to these categories. The template is there just as a guideline to determine how much I can reasonably save. If I’m not at 10%, I look for ways to trim expenses in one or more categories. I also look to see if I can reduce my expenses in some relatively painless way, to save even more.

You may be asking how I keep my expenses in check against this budget template if I don’t track all my expenses each month. Good question! That brings us to problem #2.

Another Budgeting Strategy: The 50-20-30 budget is a popular way to control your spending.

2. Spending More Than You Plan to Spend

So, you have a simple budget plan that calls for 10% savings, but you end up spending more than the 90% left over. This happens to all of us at times… but now what? Rather than going to the extreme and tracking every penny, I look at my expenses and determine what category (or categories) caused the most problems.

The problem expense areas are usually not a surprise to me. For us, it’s spending too much money eating out, buying too many clothes, or spending too much on the house.

I know these are our problem areas because I’ve been managing our money for 25 years. If you’re new to managing your money, it won’t take long for you to identify the two or three sticky areas in your budget. And here’s the point: track just those categories for a month. There’s no point in tracking expenses that aren’t causing the problem. Focus on the problem. You’ll spend a lot less time and you will direct your energy at the problem area(s) in your budget.

Learn More: Financial Freedom Calculator – How Much Should You Save?

Having tracked the problem areas for a month, you’ll have a better idea of why you’re spending more than you should. If it helps, put cash in an envelope for just these problem categories. When the cash is gone, you stop spending. Again, the point is to focus just on the problem areas of your monthly spending.

Related: Best Expense Tracker Apps

3. Getting Whacked by Periodic or Unexpected Expenses

It’s usually just when you think you’ve got control of your spending that the car insurance bill comes in the mail. In the past, this would drive me (no pun intended) crazy. Not anymore. For periodic expenses, I simply add them up over a year, divide by twelve, and put that much into my online savings account each month. When the bill comes in, I transfer the amount from savings to checking and pay the bill. For us, our periodic expenses include the following:

• Car Insurance (twice a year)
• Life insurance (once a year)
• Personal Property Tax (once a year)
• Gifts (throughout the year, but mainly at Christmas)
• Vacations (once a year)

For unexpected expenses, like a car repair, we use our emergency fund if we can’t include it in the monthly budget. Of course, we then have to add to our emergency fund, but that is what it’s there for.

Train Yourself: How to Keep One-Off Expenses from Breaking the Budget

As I said at the start, there is no one right way to budget. The best system to use is always the one that you will stick with.

For us, the simple approach is the best, and we’ve managed to control our spending quite well this way. Let us know what works for you if you use a different system!

Also Read: The Best Finance Apps for Every Budget

It is Possible to Create a Simple Budget in Under 10 Minutes?

If you’ve already analyzed your income and expenses it is possible to create a simple budget in under 10 minutes. The operative word is “simple”. You can make a budget as complicated as you like, but just keep in mind that the simpler a budget is, the easier it will be to follow.

That’s why I developed our budget as simply emphasizing a specific percentage going into savings. Once you set a savings target, and add it to your budget, you’ll have a goal each month. As long as you reach your savings goal, what you do with the rest of your money is much less important. What matters most is adjusting your spending to accommodate the savings goal. Once you do, your budget will accomplish its most important task – building your wealth.

Frequently Asked Questions (FAQ)

The post How to Create a Simple Budget in Under 10 Minutes appeared first on Doughroller.

Whether you’re a New Year’s resolution devotee or not, it’s the perfect time to evaluate your finances and fine-tune your approach to reaching your financial goals. Try these eight budgeting moves to start your finances off on the right foot.

1. Make Specific Budgeting Goals

Budgets are all well and good. But many people make the mistake of trying to make a budget without having clearly defined goals of what they’re budgeting for. 

Before you outline your budget, write down some specific and measurable financial goals. Do you need to pay off debt? Are you saving to buy a home? Or does your retirement need an influx of cash? 

Not sure where to begin? The S.M.A.R.T. goal template is a simple way to outline goals and measure your success. Here’s how it works:  

• Specific: Instead of setting a goal to save more money, nail down more on the specifics, like “I want to have a $5,000 emergency fund by the end of this year,” or “I’d like to max out my retirement contributions.” If your goal is more specific, you’ll be more motivated to reach it, and measuring your progress will be much easier to measure. 
• Measurable: Having a dollar amount on your savings goals not only makes them more concrete, it also makes it much easier to gauge your progress. For example, if your goal is to save $5,000, you’ll need to reach $2,500 by mid-year. Measurable goals are attainable goals. It also may be helpful to use a chart or online tracker to monitor your progress. 
• Attainable: It’s easy to dream big when setting goals for the year. But it’s important to set attainable goals. Look at your budget, retirement contributions, and savings from the past few years before setting goals for this year. While you always want to improve year-over-year, it’s not realistic to go from saving $1,000 a year to $15,000 the next. Look for incremental improvement. 
• Relevant: Before setting your goals for the year, be sure they are relevant to your long-term financial goals. For example, it wouldn’t make sense to amp up your retirement contribution if you struggle with paying off debt. Similarly, if your child is nearing college age, it makes sense to double down on contributions to a 529 Savings Plan or other savings account. 
• Timebound: What’s a goal without a timeframe in which you want to achieve said goal? Once you’ve set your goals for the year, put a timestamp on when you want to check those goals off. And while it’s easy to say you want to do so “this year,” it might be more productive to divide the year into 3, 4, or 6-month increments and set mini-goals within those time frames. 

As with anything, it’s important to be flexible when it comes to your goals. Unexpected costs will inevitably pop up, but don’t let them derail your long-term financial goals. 

2. Review Last Year’s Spending

Once you’ve established a few goals for a new year, it’s time to review your spending from last year. There are a few ways to do this:

Download bank transactions manually. Extend the view of your transactions to the entire year and download them as .csv files. If you generally stick with one account, it’s fairly seamless, If you use multiple debit and credit cards, combine all your transaction .csv files into one shared Excel or Google sheet. Then group your transactions by broad categories, like food, transportation, bills, and discretionary spending. This will give you an overview of your real spending versus your budget over a year. 

Use budgeting software. If you’re using an online budgeting program like Mint or You Need a Budget (YNAB), this becomes much easier. YNAB, for example, generates spending reports by category for a specified period, showing you totals and averages for each category. 

When reviewing your spending, look for a few key things — unnecessary expenses, such as unused subscriptions, a meal service you didn’t use consistently, or overspending on discretionary items, such as daily coffees or gas station snacks. 

Second, look at your highest-spend categories. Are you overspending in this area or is this truly the cost? If so, is there a way to save by buying in bulk, using a rewards program, or shopping sales? While your review of spending shouldn’t always focus on where to cut costs, most of us have areas in our budget that could use a little trimming. 

Read our YNAB Review

3. Don’t Forget About Your Sinking Fund

While it can be tempting to pay for periodic expenses like insurance, vacations, holiday gifts, and car repairs out of your checking or savings account, especially if your budget allows, try a sinking fund for these expenses instead.

A sinking fund is money you set aside to pay for preplanned, periodic expenses like vacations, property taxes, or Christmas gifts. It helps keep your budget on track and keeps you from “sinking” when these costs inevitably come around. 

To determine the amount you should save for your sinking fund, create a list of those pre-planned expenses from last year’s spending and add them up. You can either create a sinking fund for each category or have one giant sinking fund from which you pull when these expenses are due.

To calculate how many and how much you need to be saving in your sinking funds each month you’ll follow three simple steps:

• Calculate the annual cost of your periodic expenses: Use last year’s numbers as a starting point, but feel free to cut down or add to specific categories based on last year’s spending or expected changes.  
• Divide the total by 12 or account for bills that you need to pay sooner and divide by however many months you have to save.
• Add the total to your monthly budget. Yep, it’s that simple. 

And don’t be afraid to alter your sinking fund, especially when it comes to discretionary expenses, such as your annual family vacation or Christmas spending. 

Take some time to think about these expenses. Are you happy with what you spent last year? Do you want to cut back on that spending, or do you anticipate needing to spend more this year? Either way, take this into account when you’re re-doing your budgeting for annual and periodic expenses.

Keep in mind that a sinking fund is different from an emergency fund. Sinking funds are meant to pay for expected expenses that don’t necessarily fit into your budget, things like summer camp, home insurance, or property tax bills. Emergency funds, on the other hand, are to pay for unexpected expenses that you don’t see coming, like unexpected car or home repairs or an emergency room visit. 

Try a high-yield savings account to house your sinking fund, separate from where you do your day-to-day banking. You’ll make a bit more in interest on this cash, plus you won’t mistake it for spendable cash later in the year.

4. Reevaluate Your 401(k)

A company-sponsored 401(k) is a natural and financially advantageous place to start retirement savings. That’s because contributions are withdrawn pre-tax from your paycheck, meaning they’re deposited into your account before taxes are taken out. And the average company-sponsored 401(k) match is 5%, so be sure you’re contributing the maximum amount to take advantage. After all, it’s free money.

The start of a new year is the perfect time to assess whether you’re on track with saving for retirement. Look at what you have saved for retirement and the investment performance of your 401(k). If it’s underperforming and you’re on the younger side, you may need to adjust your investments to be a bit more aggressive. 

Most investment firms also offer retirement calculators to show if you’re on track with your retirement goals based on your current contribution, so it’s easy to see if and how much you need to up your contributions to reach your retirement goals. If your year-end review at work resulted in a raise, even a small increase, consider making an increase in your 401k contributions. Even a small amount can make a huge difference over time.

Keep in mind that the 401(k) contribution limit for employees in 2023 is $22,500, while those age 50 or older can contribute $30,000. In 2024, that limit will increase to $23,000.

5. Plan Your IRA Contributions

While separate from your 401(k), an individual retirement account (IRA) is still a valuable retirement savings tool — especially for the self-employed or those who may not have access to an employer-sponsored 401(k). It also can serve as an additional means of saving for retirement once you’ve maxed out your 401(k) contributions for the year. 

For 2023, IRA contribution limits are $6,500, and $7,500 for those 50 and older. Next year, that will increase to $7,000 and $8,000, respectively. 

Want to max out your IRA contribution this year?  Divide your planned IRA contribution by 12, then set up an automatic monthly contribution from your checking account to your IRA account each month. 

Some make a lump sum IRA contribution, but if you’re not able to make one big deposit, simply start your monthly contributions in January. By the end of the year, your IRA will be fully funded with no lump sum required.

6. Plan Your HSA Contributions

If you have a high deductible health insurance plan (HDHP), then you probably have an HSA. (If not, get one. Trust us.)

A Health Savings Account (HSA) is a tax-advantaged savings account for qualified medical expenses. It’s often used as an additional retirement savings vehicle since the account rolls over from year to year and it stays with you from job to job. Contributions to your HSA are pre-tax and after a minimum threshold, usually $1,000, are invested like your 401(k) or HSA. 

At a minimum, you should save the amount of your plan’s deductible and preferably the amount you predict you’ll use for medical expenses in the new year. Refer to last year’s HSA spending to determine your expected medical expenses. But don’t be afraid to contribute more than that, since you can use an overage next year or even for retirement.

Lively is one of the best HSAs out there and they’re free for individuals. Savings are FDIC insured and when it comes time to invest your savings, you can do so with a Schwab Health Savings Brokerage Account or an HSA Guided Portfolio.

7. Re-evaluate Your Debt Payoff Plan

If you’re part of the 77% of Americans who have some sort of debt, reevaluating your payoff plan should be on your list this year. Paying off debt has many benefits, from increasing your credit score, earning you better interest rates, and lowering your credit utilization. 

If you already have a debt payoff plan, now is a great time to reevaluate it. Ask yourself questions like:

• Could I make progress more quickly by changing the order in which I’m paying off debts? Paying off the highest-interest debt will save you money in the long run, while paying off the smallest debt will help you gain momentum. 
• How can I increase the amount of money I put towards debt every month? Use your new budget to free up cash to apply to your debt. 
• Could I save on interest by refinancing my debt to a lower rate? Take advantage of any refinancing opportunities or balance transfers that can save you money on interest.

Once you’ve finalized your debt payoff plan, set up automatic payments to keep you on track with payments. It also may be helpful to track your goals with a chart or spreadsheet that shows your progress in real-time. 

8. Compare Your Net Worth From Last Year

If you want one indicator of an effective budget, it’s this — did your net worth increase? Put simply, net worth is your assets minus your liabilities. So, what you own, like your car, investment portfolio, home equity, and liquid cash, minus what you owe, such as your mortgage, student loans, and any credit card balance. 

Your net worth reflects the sum of all of your financial decisions. If you need help figuring out your net worth, Empower has a free that tool lets you plug all your financial accounts in and instantly calculates your net worth.

Comparing your net worth from one year to the next is the best way to know if you’re moving in the right direction. It can prove you’re on the right track or be a sobering reminder to get back on budget.

Related: How and Why to Track Your Net Worth

Is taking a good hard look at your finances the sexiest end-of-year resolution? Not by a long shot. But by making important financial moves now, you can worry less about your money next year—and you’ll ensure you’re on the right track every new year to come.

Frequently Asked Questions (FAQ)

The post 8 Budgeting Moves to Make Before 2024 appeared first on Doughroller.

Brigit is an app that offers to help users avoid falling into the overdraft trap. It can also help improve your finances through cash advances, credit building, and budgeting. But at $9.99 per month, is it worth it? Here’s our full review.

What Is Brigit?

Brigit is well established on the financial technology scene, founded in 2017, and backed by celebrity investors Ashton Kutcher and Kevin Durant. While Brigit reports saving their users over $435 million dollars in fees since they launched, this isn’t their only mission. The app aims to give everyday Americans an entire, holistic financial makeover with the following features:

• Cash advance: Brigit users may qualify for a zero-interest, no-fee cash advance from $50 to $250. There are also auto-advances to keep your bank account from being overdrawn. 
• Credit building: A strong credit score is key to opening the doors of favorable interest rates on vehicles, mortgages, and most loans. We’ll tell you how Brigit’s credit-building account works below.
• Budgeting: For those of us who dread sorting through spreadsheets to confront our budget, Brigit makes it simple. Your expenses are broken down into graph form, separated into categories, and presented in percentages. The visuals are easy to digest, and you get a quick view of where you’re overspending. The app even recognizes patterns in your spending month to month and lets you know when you’re noticeably overspending in a certain category compared with previous behavior.
• Find jobs: When you boost your income, you create more opportunities for saving and paying off debt. Brigit connects its subscribers to money-making opportunities, from signing up for DoorDash Delivery to completing online surveys. 

How Does Brigit Work?

After downloading Brigit, you’ll be asked to connect your U.S.-based bank account. The app prompts are easy and quick to follow, and your sensitive information is protected by 256-bit encryption. In just a few minutes, Brigit

• Review your deposit and expense history
• Programs predictions and alerts for low account balance
• Calculates the amount of cash advance they can offer 

Immediately Brigit has the capability to let you know if you’re in danger of overdrafting your account. However, an instant cash advance won’t be so instant for everyone. 

Some Brigit users may qualify for an instant cash advance upon signing up, in an amount based on their Brigit score. These users likely have a simple income setup, where a single employer pays them on a predictable basis. For others who have many streams of income, cash advance qualification could come later, or not at all. Thirty-three percent of Brigit users qualify within 30 days, and the Brigit app updates your qualification status daily. 

The Brigit Score and Cash Advances

Once qualified, you get a Brigit score from 40 to 100. This score determines how much cash advance you can get from $50 to a maximum of $250. The Brigit score is a composite number that reflects your financial health based on the following:

• Bank account health: the age of your bank account, frequency of use, and average balance
• Earnings profile: size of deposits, frequency of deposits, and history of deposits from a single employer
• Spending behavior: income to expense ratio and history of on-time bill payments

Next, you can request and receive cash instantly. And by instantly, we mean in about 20 minutes. To access cash this quickly, you’ll need to link your debit card. Without a linked card, an ACH transfer can deposit the cash advance into your bank account in one to three business days. 

Your advance comes with no fees, no interest, and there’s no voluntary “tip” feature other cash advance apps “encourage” their borrowers to use as a thank you. But you are on the hook for the $9.99 monthly app subscription fee. 

Paying Back the Advance

Brigit selects a repayment date based on your pattern of receiving income deposits and automatically withdraws the advance amount on that date. You’ll receive a reminder two days before your repayment date, and you can always pay back your advance manually within the app beforehand. You can only take out one cash advance at a time. Once your repayment has been processed, you’re eligible to receive another advance. 

Brigit Credit Builder Account

Where other cash advance apps have a singular focus on getting you an advance before payday, Brigit differs in offering a way to improve your credit. We’ll go further into the pricing below, but we do feel you need to make use of all of Brigit’s services, including this one, for the app to be worth the price.

When I checked out the credit builder feature, Brigit offered me a $600 installment loan to improve my less-than-perfect credit score. When opening a credit-builder account, you have the option to choose how much you want to pay monthly toward this loan from your regular checking account, anywhere from $1 to $25, over a 24-month period. 

I selected $10. My $10 monthly payment goes into a locked credit-building account for the next two years. Brigit takes the rest of the monthly payments from the credit building loan and reports my regular payments to the credit bureaus. At the end of two years, I receive my deposits back ($240) into my regular checking account, making this feature an effective savings option while also building credit.  

How Much Does Brigit Cost?

The free version offers bare-bones budgeting oversight and account monitoring features.

For $9.99 per month, you gain access to the Brigit Plus features:

• No-fee, instant cash advances
• Auto advances to help protect you from overdrafts
• Access to your credit report
• Identity theft protection insurance
• Flexible repayment plans: If you can’t pay back your advance on the repayment date, then you can use an extension credit to pay it back later with no late fees attached. 
• Earn extra: These are income-boosting opportunities that generally fall into food delivery and online survey categories. 
• Finance helper: This feature goes beyond a simple spending habit breakdown and provides past, current, and future financial outcomes based on your income and spending habits. 
• Credit builder (Premium ONLY) An installment loan that you pay off over 12 to 24 months. Your credit score benefits from these low, regular payments. And you get your deposited money back after the loan term. 

Who Is Brigit Best For?

Do you keep getting popped with $30 to $35 overdraft fees from your bank? Then, Brigit may be the financial app for you. Brigit fights the wasteful overdraft fee battle on multiple fronts for its users. 

The free Brigit version vigilantly monitors for a low account balance and sends alerts to you if you’re in danger of overdrawing.

The Brigit Plus plan releases an auto-advance and cushions a low balance to keep you from going negative. Brigit also addresses the root of the problem, which is a lack of oversight of your budget or not enough income, and offers tools so you can better manage your bank account.

Because there are cheaper ways to get a cash advance than paying $9.99 per month, like from the Earnin app we’ll mention below, Brigit is not ideal for people who won’t make use of its budgeting, credit building, and overdraft features, in addition to the occasional cash advance. 

Is Brigit Safe?

Brigit uses 256-bit encryption, the same level of protection as your bank. This level of encryption is still impossible to crack by modern computers, so you can feel confident when sharing your bank account login information and Social Security number. 

When using the credit builder account feature, you’ll open a locked account with Brigit backed by their partner Coastal Community Bank. This bank is FDIC insured, so your deposits are also insured, up to $250,000. 

As far as personal financial decisions go, Brigit puts safeguards to help protect users from going into a deeper debt hole. Only the most financially stable users qualify for a $250 advance, a relatively low amount and only one advance can be taken out at a time.

Brigit Pros and Cons

There is no shortage of fintech apps out there, but Brigit differs in offering a mix of financial products in one place. Here’s more of what we like about the app:

Pros:

• No interest for cash advance
• No late payment fees
• No instant transfer fees 
• Credit builder and savings options
• UX-friendly budgeting/spending graphics

While Brigit modernizes old-fashioned budgeting methods, the app still favors traditional employment models. For example, Brigit will take longer to approve you for certain paid features, like Instant Cash, if you’re paid sporadically or have many different streams of income. You’ll also need to make at least $1,000 per month from one client to be approved at all. Here’s a list of other things we dislike:

Cons:

• Limited to $250 cash advance
• Recurring monthly $9.99 cost to access all features
• Limited income booster opportunities
• Only works with U.S.-based banks
• Not freelancer friendly
• May take some time to be approved for a cash advance
• Some user reviews report having trouble getting the app to work or link to their bank account
• Many user reviews report having trouble canceling the subscription service

Brigit Alternatives

Earnin

Some financial emergencies demand more cash than $250. Preferably, you have an emergency fund to pull from. But when finances are stretched thin, Earnin is a cash advance app with unbeatable maximum limits, at $500 for regular users and up to $1,000 for users with an Earnin Express deposit account.

The app is also free to use, so you won’t be handing over $9.99 per month. However, you’ll still need to be paid on a predictable schedule from one main employer. 

Earnin is ideal for those who prioritize cash advances for no cost since this platform does not have all the extra financial bells and whistles that Brigit offers. Earnin is also more involved in tracking your income. Beyond employment verification, Earnin tracks your work email, your physical location, or your electronically logged timesheets to determine your hours worked and the maximum amount of cash advance you can take out.

Read our Earnin Review 

Chime

Chime^® came onto the fintech scene in 2013 and has since been a leader in transforming the traditional banking model. Chime offers the following features:

• Visa^® Debit card
• Access to Secured Chime Credit Builder Visa® Credit Card
• Get paid up to 2 days early with direct deposit²

Chime also has the SpotMe option for Chime Checking Account holders. SpotMe makes it possible to spot your account anywhere from $20 to $200 without penalty. Anyone who has a single qualifying deposit of $200 or more can qualify for SpotMe. 

Chime has no subscription fee, but it’s also not a budgeting app. Instead, Chime offers banking products with no monthly fee, so this may be the fintech company for you if you don’t need a budgeting app.

Read our Chime Review

Chime is a financial technology company, not a bank. Banking services provided by, and debit card issued by, The Bancorp Bank, N.A. or Stride Bank, N.A.; Members FDIC. Credit Builder card issued by Stride Bank, N.A.

Frequently Asked Questions (FAQ)

Final Thoughts

Brigit can be worth the price if you fully utilize its budgeting, credit-building, and cash advance features. But it’s expensive so you won’t want to use it long-term. The income-boosting feature isn’t worth paying for – it’s essentially the same time-consuming survey platforms you can find anywhere else online. If you need just one of Brigit’s features, you are likely to find it somewhere else cheaper. 

To get an occasional cash advance once or twice a year, try the financial institution you already bank with. It’s better to pay an occasional advance fee for emergencies than an ongoing $9.99 per month.

For budgeting, there are accessible, low-cost financial tools out there that can help you manage a budget and access cash while you build up your emergency fund.

Brigit

Michael Pruser

User Features

Loan Options

Customer Service

Costs and Fees

Mobile App

Summary

Brigit is an app that can help you budget and allows you to take a cash advance without interest. Costs are reasonable and the mobile app is a big plus.

4.5

Consider a Cash Advance with Brigit

The post Brigit Review 2024 – Budget Your Way Through Your Next Payday appeared first on Doughroller.

It has some interesting features that make it helpful for personal budgeting, investment management, and even simple business or group budgeting. Here’s what you can find with CountAbout and what sets it apart from the crowd.

Countabout Features

CountAbout offers some interesting features. Some of them are pretty standard for online money management software. Others are unique.

Standard features include the ability to automatically download your transactions from many financial institutions, budgeting features, custom income and spending categories and tags, financial reports, and apps for both Android and iOS.

Some of the software’s unique features include:

• Data imports directly from Quicken and Mint
• Widgets that let you customize your view and get at-a-glance data on your finances
• Running balances that include uncleared transactions
• An ad-free interface
• Recurring transactions

Simple User Interface

I personally am a fan of Mint’s user interface. However, it has gotten more cluttered recently with ads. The CountAbout interface is much cleaner but also less fancy. It’s fairly intuitive, though, The interface includes several tabs across the top–Transactions, Budgets, Reports, Recurring, and Invoices.

Under Transactions, you’ll find any transactions automatically imported from your bank. Or you can add transactions on your own manually. If you prefer to do things this way, you don’t have to import your transactions at all. You’ll add transactions that you can then categorize, which will also let you track your budgets for various categories.

Under Budgets, you can set up budgets for various categories. This section is interesting, as you can view your budget annually.

Under Reports, you can find some standard reports, including reports on your accounts, categories, and tags. You can export these reports into a CSV if you need to store the data elsewhere.

The Recurring section allows you to add transactions that take place each month. If you’re manually tracking your transactions, this can be a simple way to save some time rather than inputting these transactions each month.

Investments

The Investment page is available to Premium subscribers only. There you can maintain a list of all investment holdings at institutions that provide holdings data through CountAbout’s data provider. (Note: the feature does not include the ability to manually add investment transactions, nor is there a plan to include it.)

The Investments page provides a ready list of the securities held in your portfolio, as well as the market symbol, cost basis, market value, and gain/loss percentage. If you have multiple investment accounts, it’s a convenient way to keep all your investment holdings in one place.

CountAbout added an Invoice feature that can help small businesses, contractors, and freelancers better manage their billing of clients and customers. What makes the Invoice feature even more attractive is that you can transfer data to and from Quicken, Freshbooks, and Wave. That will help you to better integrate your business activity with your accounting software.

CountAbout Plan Pricing

CountAbout offers two plans, both include a 45-day free trial to make sure you’re happy with the app. The standard plan does little; it will allow you to set up a budget the entries must come manually. This is a good place to start if you want to see what CountAbout can do for you but long-term, spending the extra $30 a year is a no-brainer.

The Premium Plan is what the vast majority of subscribers use and it will automatically download your bank data to place in your budgets and projections. When you compare the cost vs. other budget apps, just over $3 a month is on the low end. Very reasonable.

Inputting Budgets and Transactions in CountAbout

Before you start inputting a budget, you’ll want to mess with your category list. You can customize all of your category names, and you can use more or less than what CountAbout comes with.

It comes with a huge list of categories, including a large number of income options, and tons of different expenses categories. You can also click the edit button in this section to change the available categories.

Add more detail to your transactions with tags. So, for instance, you could have a transaction that falls into your Food & Dining category, but then include Fast Food, Fine Dining, and Grocery tags. Then at the end of the month, you could see how much you spent in each of these smaller categories without your budget having too many overarching categories.

Alternatively, you can also add transaction images. Simply snap a photo of your receipt or other documentation using your mobile device, then upload the image to the related transaction in CountAbout.

Once you get the categories settled, then you can create budgets. You create budgets each month for the whole year. So you could budget to spend $500 on groceries every month, but maybe you bump it up to $600 in November when you host Thanksgiving festivities.

It’s helpful to look at your budget on an annual basis, and many budgeting software doesn’t account for this type of budgeting. You can also budget for the expenses based on the year. So if you want to spend $2,000 on entertainment for the whole year, just put that into the Yearly box. Then it’ll automatically split out the amount evenly across all twelve months.

If you start with a history of categorized transactions in CountAbout, you can base your budgets on your historical transactions. That’s what the “Use History” button means. Of course, you need to have some data in the system for that to work! But once you do, it can be an interesting way to get a base for your budget, but then you can tweak the budget from there.

Each time you add a transaction, you’ll have to add it to a category. This ensures that it comes out of the right budget. If your transactions are automatically added, you can add a category to them as you approve them.

The transaction will ask you which account it comes from, what category it goes into, and what tags apply. And, of course, you’ll have to input the amount.

Once you input transactions, you can clear them by clicking into the account the transactions came out of. This interface will also let you see your balance, adjusted balance, and uncleared transactions. You can reconcile your accounts from this interface, as well.

Widgets

As I said, one of the interesting things CountAbout offers is widgets. These let you add some graphical or text-based elements to your interface. But instead of guessing what you care about, they let you completely customize the interface to reflect what’s most important to you.

So you can, for instance, put a chart of your account balance on your Transactions page. This will give you a historical representation of your account’s balance. If you sync your transactions, the balance will be up to date with what your bank account shows.

Pros and Cons of Countabout

Pros

• Simple user interface — If you’re overwhelmed by a lot of graphics and ads on your current budgeting software, this one might be the best option for your needs. It is very simple and streamlined
• Automatic downloading of transactions — Some people may be uncomfortable with this from a security perspective. But I much prefer it for my budgeting software, as it saves time versus entering every transaction manually. (Note that if your bank has multi-factor authentication, the sync may not work. I had trouble getting it to sync with Huntington National Bank, but I also have this issue with other personal finance software.)
• Customizability — The ability to customize your user interface, budgeting categories, and more means you can use this software exactly how you need to. This means it is applicable for both personal and business spending, which could be helpful.
• Ease of use — Because it’s pretty straightforward, CountAbout is also easy to figure out. You don’t have to jump through a lot of hoops to set up your accounts and budgets.
• Transferability — If you’re transferring from another popular budgeting software, especially Quicken or Mint, you can move your historical data over to CountAbout. This is a helpful option if you want to pull in your last few years’ worth of data.

Cons

• Simple user interface — If you like the bells and whistles that other personal finance software offers, you might not prefer the interface of CountAbout. This is really more of a personal preference than anything.
• Accounting focus — Being able to reconcile your accounts and clear transactions is helpful, especially if you’re a business. But if you’re looking for more of a streamlined “about what I spend each month” software, this one may not be the best option for your needs.
• Cost — CountAbout isn’t free, which is one of the reasons that it doesn’t include pesky ads all over the interface. The premium version, which includes the auto-sync option, is $39.99 per year. You can also get a basic version for $9.99 per year. You can try the software free for 45 days, though, so you can get a feel for it before you spend money.
• Lack of investing functions — CountAbout can sync with investing accounts. But it doesn’t have a lot of functions for this. There are definitely more robust options out there for tracking your investments.

Alternatives to CountAbout

Simplifi

Simplifi is a great alternative to CountAbout that allows you to input custom savings goals, see your future cash flow position, and provide a personalized budget based on your expenses and income. You can share your finances with a partner if you wish and set up financial alerts so you’re always aware of the money coming in and going out.

Pricing for Simplifi is comparable to CountAbout. The cost is just a month.

Read our Simplifi Review

PocketSmith

PocketSmith is another personal finance software app that offers users an excellent set of features to help them prepare a monthly budget. PocketSmith focuses more on your future, providing annual projections to help guide you through your financial future.

Three plans are available and the higher up you go, the longer PocketSmith will offer projections. All three plans offer automatic bank fees and all offer email customer support with unlimited budgets. You can find the differences here:

Read our Pocketsmith Review

Who Is CountAbout For?

If you’re a detail-oriented person who likes keeping an annual budget with very detailed categories, CountAbout might be a good option for you. At $39 per year, the cost definitely isn’t prohibitive. If you prefer to enter your transactions manually, you can pay just under $10 a year for the basic version.

This software is also a viable option for small businesses or even organizations like your school’s PTA organization. If you’re responsible for managing money for organizations besides your own household, CountAbout includes some basic accounting and reporting functions that you could find very helpful.

Those who are less detail-oriented or need more basic functions can probably get by with free personal finance software. Or if your goal is more about tracking your investments versus tracking a detailed budget, you might try investing-centric software like PocketSmith instead.

CountAbout

Kevin Mercandante

Features

Mobile App

Pricing and Fees

Account Integration

Security and Customer Service

Summary

CountAbout offers a simple user dashboard with excellent features and an easy-to-integrate budget. With a low monthly fee, CountAbout is a great financial tool to use.

4.5

Create Your Budget with CountAbout

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