How to Make a Monthly Budget in 6 Easy Steps

Growing up I always wanted more rather than less; of course — that seems to be how it always goes. We all want the next new thing, whether that be something small like a new shirt, handbag, or something big like a car. Buying all those new and hip things really doesn’t amount to anything, and I ended up learning that the hard way. So I’m going to lay it all out there and talk about what most don’t; money. Here are some tips and tricks on how to make a monthly budget that fits you and your lifestyle.

Ever since I was a little kid, I was always working to buy whatever I wanted, whenever I wanted. Before I was old enough to work, I would owe my mah for all the toys I wanted. In high school, I would spend every penny I earned. I even got a brand new car during my first two years of college with a hefty monthly payment thinking I would still be fine. What I wasn’t thinking of was my future — moving out, getting my own apartment, and attending a college that cost thousands a year. 

Everything was fine and I was just getting by when I moved to my college town. I worked a lot and could only afford where I was living and about $120 in groceries every month, if that. After about a year, I ended up taking an internship in Portland with little notice. Luckily enough, the company I was working for helped pay part of my rent, but there was still about $300-400 I paid each month whilst still paying about $450 to hold a spot in my apartment back home.

Don’t get me wrong this is pretty dang cheap for rent, but with both of them, while having a car payment, and the needs of every other human out there, it just wasn’t enough. I’m not kidding when I say it got so bad to the point I was going to the grocery store every so often and mapping out how much I could buy with the $15 I had left for the next two weeks.

Of course, this was also when I had SIBO and was like a bottomless pit, but I couldn’t afford to have anything but toast and mayyyyybe some almond butter every meal of the day.  

I had single-handedly got myself into that situation. When moving to Portland, I was blowing money left and right. I bought new clothes, shoes, perfume, jewelry, kitchen supplies, and literally anything else you could think of, without understanding the consequences. 

Flash forward to where I am today — I saved up enough money to go unemployed for basically two months, I was able to build my savings and pay off all my debt besides student loans (that’ll take a hot minute), and I only buy when I really need to buy. 

I was even getting my nails done the other day and my nail technician looked up at me randomly and started talking about what makes life beautiful, and what he said actually stuck with me. “The money and what you may or may not have doesn’t make you happy, it’s all the memories you make, both good and bad.” Man did that hit home, especially while sitting at a salon not expecting something of that nature.

I couldn’t relate more, I just learned the hard way. I was working up to three jobs and barely getting by because of all the dumb purchases I made. I couldn’t even tell you what I spent it on cause I can’t even remember. 

For all you that are wanting to buy something you don’t need over having fun in the moments you collect, this is for you. Make a monthly budget, stick to it, and build the future you want to have without stress and a million pairs of shoes you don’t care about anymore. 

Let’s Break it Down

Start off by really digging into your bank statements. How much do you make before and after taxes? Where do you spend most of your money? Where are you able to save? 

One big mistake I made throughout this process is I disassociated myself with my money. I thought if I didn’t look, it wasn’t a problem. This is the worst thing you could do. By no means should you characterize or label yourself depending on your money bracket, but know it like the back of your hand when it comes to making a purchase.  

1. Look at the numbers

Once you get an idea of where your money is going every month and how much you truly make, you are able to figure out the areas to cut back. 

2. Subtract your hard necessities 

Once you know your raw income, subtract everything you absolutely need to have to survive; shelter, transportation, food, medical, insurance, and retirement are some good examples. Given, you should try your hardest to keep these numbers down, while still obviously maintaining a comfortable environment around you. 

Always ask yourself the hard questions; do you absolutely need a new car? Do you really need an apartment that is almost double what you are paying now just because it has a pool? Or do you really need $120 in groceries a week from the health food store alone?

Think about your needs and where you are able to cut down on expenses. Optimize on the important things you may not be taking full advantage of currently, like retirement. 

3. Subtract any sort of debt you have

Now, this is the hard part, after you have subtracted your needs, subtract whatever debt payments you have; credit cards, student loans, car payments, or any other loaned money. 

You should be paying off your credit cards in full every month, but if you aren’t, try your hardest to pay them off to the best of your ability while not buying anything else in the process. Credit card debt can really consume you, be mindful before handing over your card for that shiny new handbag.  

4. Contribute to your savings

For those that have a lot of debt, this is the section that lacks the most — your savings. Personally, I like to keep a minimum of $1,000 in savings, just in case life throws me a curveball. But by no means should you just keep it at that, I try to put about 10-15% of my raw income into savings each month, if not more. This will come in handy when you want to make big life purchases like a house or a well-deserved car.

5. Figure out what’s left 

Whatever you have left, I divide this by four to see what extra I have to play around with each week. Whether you like to spend your money on drinks, going out to dinner, or getting a top of the line coffee, budget for it.

Back in high school and college, I would literally buy up to 3 to 4 coffees a day. Given I was lucky enough to work at a coffee kiosk and only drink the cheap drinks, like drip, I would still spend up to $4-8 every day. That alone amounts to $120-240 EACH MONTH. That hurt, that realllllly hurt. 

Think about it, buying a boujee Nespresso or even a standard one would be equal to or cheaper than one month’s worth of Starbucks every day. In my budget, I actually have a section just for coffee. I don’t eat out or spend money on entertainment much, but I do go mad over a nice cup of coffee on the weekends. 

Treat yourself sometimes, but only sometimes.

6. Cut down on what you really don’t need

Truly be honest with yourself when it comes to something you think you “need.” There were times I thought I needed a whole new wardrobe or a new handbag every week, when in reality, we could all live with so much less.  

Save yourself the shopping guilt from buying more clothes than you could wear, gas from being unrealistic with your travel plans, and getting too many coffees — opt for the inexpensive vs. expensive. Most importantly, stop saying you deserve this or that when you simply don’t have the money. 

Not only can overspending create stress that potentially leads to even more retail therapy, but it also creates a downward spiral that’s a hard one to stop. 

Never let material items control your happiness.

Sadly this is something my Dad would tell me all the time growing up, yet I would never listen. Spending money doesn’t amount to the kind of happiness you get when spending time with your loved ones, and it most definitely won’t amount to much when things go bad.

Tools I use

Since making a monthly budget can be time-consuming and hard to manage, here are my all-time favorite tools to keep me on track.

1. Google Sheets

This is my absolute favorite tool. Google sheets allows me to strategically plan my spending habits each month, plus it is fun to design. I make mine bold, in cute little boxes, and all pastel colors.  Google also make it easy to enter what I have spent on the go using their app.

2. Envelop system

For those of you that don’t trust having a card on you when trying to stick to a budget, I highly recommend using the envelop system. This is when you only carry around the amount you have budgeted for so you literally can’t go over by even just a penny. I always use this method for coffee; if I don’t have the cash on me, I can’t buy it, simple as that. 

3. Apps

Aside from Google Sheets and the old school envelop system, there are various apps out there that can help build your monthly budget, simple and easy. Some of the most popular ones are Google Keep and Mint. I haven’t tried either of them, but if you are wanting to create something fast and easy on the go, these are for you!

Managing your money the right way can leave you stress and anxiety-free and help you remember the important things, like family. Be truthful with yourself and if it helps, tell a loved one to help keep you and yourself accountable for being a money-saving boss babe. 

 

Until tomorrow,

Xoxo

Kayla

 

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