How to Actually Stick to a Budget, Part 1

Personal finance goals are consistently some of the most popular goals set by the women in the Cultivate What Matters community—and with good reason! When we feel confident about our money, we free ourselves up to dream about what our most purposeful, meaningful lives might look like—and then give ourselves the ability to take action and start living them! 

While we've written about how to build a budget and how to track your spending, today's post will be a little bit different. It's one thing to know how to make a budget and it's another thing entirely to stick with it—keeping it updated and useful over the long haul—and stick to it—spending and saving within the guidelines you've set out.

On a personal note, I've followed a written budget for sixteen years now, and I can confidently say that it is the number one reason I feel at peace with my finances. I don’t worry about whether or not we’ll have enough money to pay our mortgage or insurance bill every month; if we stick to the budget, I know we will. The headspace this surety frees up allows me to focus on my dreams and keeps me on track to reach my lifetime financial goals. There are few things better than that!

If the word budget sounds scary, shake off that fear and listen to this: a budget is not about denying yourself and cutting out everything fun, it’s about making a plan. Dave Ramsey likes to say that budgeting is “telling your money where to go." I like that image. A budget helps me be purposeful about how I spend and save instead of just closing my eyes and hoping. 

So yes, budgets are great—but keeping a budget updated consistently is where the real power of budgeting shows up. Here are some practical, easy-to-follow tips to help you stay on top of yours!

1. Make sure it actually matters to you. 

You knew we were going to start here! Updating a budget can be tedious, frustrating, and even dispiriting. (It can also be energizing and motivating, but it's good to temper expectations here at the beginning!)

To stick with it for the long haul, make sure that your money "why"—your motivation for spending, saving, and giving in alignment with your budget—is clear, powerful, and personally-meaningful. If you can do this, you'll be much more likely to follow through with the week-to-week tasks.

2. Upgrade your identity.

Mindset shifts are some of the most powerful tools we have available to us in goal setting. "The more pride you have in a particular aspect of your identity," James Clear writes, "the more motivated you will be to maintain the habits associated with it." If you believe you are an excellent money manager, you'll be more motivated to act like an excellent money manager—a.k.a. update your budget regularly.

On the flip side, it's hard to change your habits if you never change the underlying beliefs that led to your past behavior. It's worth taking the time to determine the fears and negative mindsets that hold you back, and actively work to reframe them with new narratives. (The Finance Workbook has a whole section to help you do this!)

3. Focus on repetition, not perfection. 

At the beginning of a new habit, you're building an identity. Every time you perform the habit, you're giving a vote of confidence to your new identity. So just sit down and get started—don't worry about whether you get the budget completely up to date each session. Over time, with consistent deposits, your belief in yourself as a money manager will grow.

4. Find the budget format that's right for you.

There are many ways to track a budget, and almost certainly one that will be a good fit for you!

When choosing a system, it helps to be honest about your preferences and realistic about your abilities. For example, my family uses a custom Google Sheet. It works for us because we use very little cash and value historical data, but it does require a lot of manual data entry. Not for everyone! 

If you know you need something turn-key, an online budget app that automatically syncs transactions could be a good fit. YNAB, Credit Karma (formerly Mint), and EveryDollar are popular options with the CWM community. 

Don't want to deal with data at all and worried about overspending? Maybe you're an envelope system gal! 

5. Make a specific plan for when you'll update your budget. 

This is called an implementation intention, and many studies have shown how powerful they can be!

Name the exact details of when you'll update your budget. Think: first thing in the morning on Saturdays, while I'm still in bed or as part of my weekly reset routine on Sunday afternoons. Until updating your budget routinely becomes second nature, write it in your planner and use reminders or calendar alerts to cue your new behavior.

6. Fold updating your budget into an existing habit or routine.

There's magic in habit stacking, or pairing a current habit with a habit you're hoping to grow. The key is to choose an "anchor habit" that is already a no-brainer part of your day. This way, you won't need to worry about remembering to perform your new habit—the old one will trigger it! 

If you already have a weekly reset routine in place, adding budget updating to your flow might be a seamless addition. If not, look for another spot in your week when you can consistently sit down with your app, wallet, and receipts.

7. Make it enjoyable. 

Pairing a habit you need to do with something you want to do is called temptation bundling, a term coined by Katherine Milkman (a behavioral economist and professor at the Wharton School of the University of Pennsylvania). What this looks like will be unique to what brings you joy, but what about logging numbers while watching your favorite mindless reality show? Or checking transactions on a slow Saturday morning in bed, coffee in hand? 

8. Make it easy.

Make it as easy as possible to tend to your budget, because the more energy that's required, the less likely it is to occur. Make sure you can access your tracking app or spreadsheet on your phone. Jot down your log-in in a safe place. Keep your receipts in one accessible location. Make budget categories simple. 

9. Set a timer.

If it feels hard to start the process of updating your budget, set a timer and promise yourself you'll do it for just ten—or even five!—minutes. Once you're ten minutes in, of course, you're likely to finish the job, but even ten minutes adds up over time.

10. Track your habits.

Adding a small burst of immediate, positive reward for a habit is a great way to make it stick. Many studies have shown that our brains thrive on the tiny firework of pleasure that is checking a box. Check in with your PowerSheets® each time you update your budget to help your new habit grow! 

We'd love to hear: Which of these tips have you successfully applied? How do you make sure you stick with updating your budget?