You Need a B WORD.


Woah there! Did you just CRINGE at the word “budget”? You, like many other people, may get a negative feeling even mentioning the big “B” word. I personally love it. I get EXCITED when I get to talk about budgeting. My day is MADE when someone tells me how my budget tips changed their life.  I’ve got a super simple task that you can do TODAY to start getting on top of your budget…. but first….

What IS a budget?

One of the reasons many people have a hard time budgeting is because they don’t actually know what a budget IS in the first place. Let’s cover that now. A budget is a plan. It is a road map for how you are going to spend your money. It is NOT an analysis of how you HAVE spent your money. A budget is looking FORWARDS. It is NOT looking backwards. It is finding the facts of how you have been spending your money only so that you can create a plan to modify your spending in the future. It is making sure that you have money set aside for FUTURE YOU. It is planning ahead for expenses, like new brakes on your car, a new hot water heater, or having someone come clean your gutters and mow your lawn. It is figuring out what your NEEDS are vs what your WANTS are. It is how you figure out how much money you have to spend on your LIFESTYLE, after covering all of your NEEDS. It is achieving your lifestyle goals, like a family vacation, by putting aside money every month to get them. It is checking in and adjusting your plan any time your financial situation changes, or you add a new goal to your life.

And my favourite way of budgeting is to make things as automated as possible… because you have better things to do than sit down and look at your statements to figure out where your money went every month. 

I break budgeting down into these easy steps:

  1. Find the facts
  2. Needs versus Wants 
  3. Future You
  4. Lifestyle
  5. Make it Stick

Today we are going to focus on step one. Finding the facts.

Now, one of the things that people do wrong when they budget is they look out the window and they see unicorns. Now, what do I mean by that? I mean they’re in a fantasy land. They’re not looking at reality and using the facts of their life and their expenses when they create the budget. What are the chances of you staying on track if your numbers are grabbed out of thin air? 

This step can be very time consuming if you have never done it before, or if you haven’t done it in awhile. You NEED a comprehensive list of your previous expenses that spans at least 3-4 months to capture all of the irregular expenses that come up. You don’t have to finish it today (unless you’re feeling super ambitious) but you do need to figure out how you are going to get this done in the future. Make an appointment in your calendar with yourself. If it ain’t in the calendar, it ain’t gonna happen.

Here are some ways that you can track your spending:

  1. Log in to your online banking. Many banks have apps, graphs, or charts to show you a record of your spending categorized for you. See if your bank has one of these options. 
  2. Use a program like Mint or You Need a Budget that links to your bank account. These apps will categorize all of your purchases automatically and let you filter timeframes. You will have to edit some of the categories, because they aren’t always labelled correctly.
  3. Print your bank statements and use a different colour highlighter for different major categories (Groceries, Utilities, Mortgage/Rent, Health, Education, Coffee or Fast Food, Entertainment) Try to keep the categories simple. 
  4. Bank Account Budgeting. In the Pretty Money Club, we automate our bank accounts so that our money is allocated ahead of time. We tell our money where to GO, we don’t look back to try and figure out where it WENT. I call this Bank Account Architecture, or budgeting right inside your bank account… Bank Account Budgeting. It’s the easiest way to do things… but it takes a bit of time to set up. More time than I have to explain to you in this exercise. If you want to learn how to do this, join the Pretty Money Club.
  5. My Spending Tracker. I’ve created a super simple tracker for you to use going forward. You can keep track of all your lifestyle spending choices (your wants.) You might be surprised at how much they add up.

Your task is to PICK a way that you are going to track your spending and make some time in your calendar to DO IT.

If this is too overwhelming or you’re looking for some extra support, sign up for my free 5 day budget makeover series and I’ll walk you through it.

Published by theprettymoneyblog

To all you women that are working too damn hard to feel like you’re just getting by paycheque to paycheque… To all you ladies that just don’t have the freaking time for financial jargon and complicated budget systems… ​To all you women struggling to feel in control of your money, ’cause you know you can rock it if you just had a simple map… I see you. I GET you. I'm a busy mom of two boys and a wife to my business partner. I love baseball, red wine, and our family trip to Mexico every year. After more than a decade as a licensed professional in the personal finance industry, I’ve figured out strategies that are simple, but have massive impact on your wallet. I’ve left out the jargon and fine print because I know you don't have time for that. The Pretty Money Club enrolls new members twice a year for the 8 week course that will turn your ugly budget into top model pretty money... and most of our members stay in the club after class is done to keep learning and stay in touch with all the women they built community with.

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