Don't be a Budget Hater! Here's How to Budget Better.

You may have the right budgeting tool… but do you have a budgeting approach that brings you peace rather than stress?

When you hear the word BUDGET, what comes to mind? Maybe something like...

"That sounds intimidating!"

"Having a budget stresses me out!"

"Budgeting is so BORING!" 

For most people, budgets don't exactly elicit positive feelings.

A lot of people experience dread and overwhelm when they think about budgeting.

According to TIME, more Americans are budgeting now than ever before. 82% of Americans have some sort of budget.

But many people find it hard to stick to their budget.

Budgets have had such a bad name that at a prior employer, we spent a great deal of time trying to disguise the word “budget.” And this was before the boom of budgeting apps!

We used friendlier alternatives instead: cash flow management or financial independence analysis. 

Whatever your nomenclature, my goal here is to challenge the way that you view a budget.

If you have lots of unpleasant feelings around budgeting, I invite you as you read this article to dive into WHY.

WHY does the word BUDGET evoke negative feelings for you?

I do a lot of money mindset work with my clients as a financial planner. My own mentality around budgeting has definitely changed over the years, too!

In my own financial journey, I have learned that budgeting doesn't have to be intimidating, stressful, or boring.

In fact, budgeting can help you reach your loftiest goals. 

My hope is to help you shift your perspective on budgeting by the end of this post. I promise you that it is totally possible to feel better about budgeting. 

You might even learn to LIKE it! Who knows?

Let's start by diving into why icky feelings are coming up for you around the word BUDGET.

Why Budgeting Makes You Feel Bad

So, why does the word BUDGET evoke feelings of dread and overwhelm?

Whether you're using a budget for the first time or have used a budget but couldn't stick to it, you may be thinking...

"Wow, this is hard!"

Budgeting is usually someone's first foray into learning money management skills. Whenever we try to learn a new skill, we can feel a little (or sometimes very) anxious. 

Lacking knowledge in as critical an area as finances can feel overwhelming. This is especially true if we are being forced to learn under pressure.

But needing to learn a new skill doesn't have to make you feel nervous. Like any other skill, budgeting requires a few key ingredients:

•  The right information - these days, you can find TONS of online videos, articles, and podcasts on financial literacy!

• The right tool - whether it's an app, a spreadsheet, or a simple envelope system, you need a budgeting tool that works for you.

• The right mindset – developing a growth mindset around learning a new skill is the key ingredient to success!

Budgeting is like every other skill. You can learn it, and you can master it. If you're a budgeting beginner, know that it does get easier with practice and patience.

But what if you've had a budget for a while and still dread the budgeting process?

You may, like many people, find that the word BUDGET evokes negative emotions because it implies that...

1. You must know exactly how much you are spending in a given month.

2. You need to develop a plan to decrease that spending. 

If you feel stressed about these two aspects of budgeting, the pathway out is actually pretty simple. 

The issue is not the budget. 

Budgeting in and of itself is not bad or stressful. The negative feelings are not coming from your budget.

They come from how you approach your budget.

A lot of the unpleasantness associated with budgeting has to do with ONE core problem:

You are not budgeting and spending in alignment with your values.

If you are not clearly articulating what your values are and defining a WHY behind your budget—one that you truly believe in...

Well, you're going to have a hard time. You will sit in the belief that there is no real point and feel lots of negative emotions around budgeting.

Yes, you need to track your spending when budgeting. But it's not always true that you need to develop a plan to decrease spending. 

What you may actually need is to shift (or re-prioritize) certain line items on the budget. 

This means understanding what your priorities are during this season of your life. To understand your priorities, you need to get clear on what your values are.

Part of aligning your spending with your values means focusing on what you want to spend on. A lot of people who focus on decreasing their spending feel a lot of resistance to making budget cuts.

Sure, sometimes you have to make budget cuts. But the problem is when you spend time and energy trying to figure out how not to spend money, you are taking a negative focus.

The reality is that it’s harder to not do something than it is to do something.

Let me break that down for you.

Let's say you need to reduce your caffeine intake. You decide to stop drinking coffee. If you tell yourself, "Today, I won't have a coffee," notice what happens in your mind. 

Your mind doesn't acknowledge the "won't." What it actually registers is the word "coffee." 

When it comes to actions, the word "not" is a completely meaningless phrase in your mind.

The nature of the human mind is to focus on positive realities. It understands objects that actually exist in the world. To prove my point, say to yourself, "Today, I won't drink coffee." What does your mind do?

It pictures coffee.

The mind doesn't understand what "not coffee" means. You can't drink something called "not coffee." So, it focuses on the object it understands, which is...

Coffee.

 And because your mind focuses on coffee, your mind is going to come up with lots of interesting ways to convince you to drink it.

To circumvent the “not coffee” madness, it would be better to reframe what you will drink as a substitute instead. Tell yourself, “I will drink green tea” because it has less caffeine than regular coffee.

Giving yourself a positive action to implement will move you toward your goals faster and more easily.

So, how does this apply to budgeting?

Let's say you tell yourself, "I am not going to spend any more on eating out. No more restaurants. No more pubs. No more cafés. No more eating out!"

What happens in your mind?

It thinks about your favorite places to eat. It brings up how much you like that local burger joint or how you'll miss your favorite bistro down the street.

And these thoughts stir up feelings like...

Regret. Dread. Resentment. Anxiety.

But if instead you say, "I am going to spend more on fresh produce this month and make healthy, tasty meals at home..."

Your mind starts to think about what kinds of meals you could make with all the fresh produce you're going to buy. It starts thinking about the recipe books sitting on your shelf and the farmer's market starting this summer.

And you feel curious, motivated, and even EXCITED.

When you take this positive approach to budgeting, your feelings about it will change. 

If you're wondering how to budget better, I invite you to ponder these questions:

1. What would happen if you stopped giving time and energy to figuring out how not to spend your money? 

2. What would happen if you made it your overarching goal to spend in alignment with your family values?

3. What is your fundamental WHY behind having a budget at all?

Use these questions to change your focus and see what kind of results you get. You might find that the burden of budgeting becomes a little lighter.

Now let's talk a bit more about what a budget actually is.

Budgeting is a tool that can facilitate your financial freedom… so you can plan for beautiful experiences like a tropical island vacation!

Budgeting as a Tool

As you might be starting to suspect, budgeting is not evil. It is not something that holds you back from what you want to do.

Rather, it is a tool that creates awareness of your current spending and saving patterns. A budget is a starting point to craft a concrete financial plan and build family wealth.  

Since life is not static, financial goals will change over time. Recognize that your financial aspirations should tie in to your life priorities. 

There are seasons of life where you may be more focused on yourself than others. If you're single or a newlywed, you may want to attend expensive concerts, dine at fine restaurants, and do lots of traveling.

When you have kids to feed and larger bills to pay, conservation takes precedence. Your indulgences as a single person will fall away as your focus turns toward providing for the entire family.

Creating a cohesive family budget will take time and energy.  

As income rises, you have the luxury to prioritize experiences, tangible items, or additional savings. When income falls, you need to make lifestyle cuts without putting the health and safety of your family in jeopardy.

But if you... 

• Redirect your attention to where you want to spend your money

• Focus on aligning your spending with your true values

• And keep your reason WHY at the forefront of your mind

...you won't feel all the negative emotions you had before about your budget.

My Budget Journey

My own budget as an adult has shifted a lot over time.

As a new college graduate, my budget was pretty basic. It had three main categories:

1. Fixed expenses (e.g. rent, utilities, insurance)

2. Variable expenses (i.e. food, clothes, entertainment)

3. Savings (to fund a down payment on a home) 

At the time, I was single, living in the Midwest, and earning a strong salary as a new accountant. There was plenty of wiggle room in my budget for fun expenses like entertainment and recreation.  

By the time my husband Bryan and I married, we owned a nice starter home and had a solid joint emergency fund. 

Budget category names remained the same, but extra funds went into joint savings. Our goal was to buy a larger home in the suburbs, so we were saving for a down payment.

I still use the same budget format from Microsoft Excel that I developed over fifteen years ago. But now there are many more line items in each category. 

After we started having children, things changed. 

We had a “budget overhaul” with the addition of each child. We had to redirect our spending away from some items to other more important categories.

When our first son was born in 2009, I returned to work after a 6-week maternity leave. Saving was relatively easy, even with a reduced workload and full-time childcare expenses. 

With the arrival of our second son in early 2013, I was unsure about returning to paid work. 

At that point, Bryan was working full time and attending a rigorous evening MBA program. And we now had two small children to care for. It was... a lot.

We must have reviewed our budget at least 100 times to see if we could live solely on my husband’s income. 

Seriously. 

I reluctantly went back to work after baby #2 but only stayed about eight months. It was simply too much to handle...

I had a forty-minute commute each way. Bryan was absent in the evenings. Both these situations made it too difficult for me to juggle work and family responsibilities.

This was a HUGE change for our family, so things quickly went from financially comfortable to... awkward. 

The reality further set in after our third son’s arrival. Categories that felt like indulgences before kids were now exclusively focused on our boys. 

We actively sought out activities for low or no cost that we could enjoy as a family. The vacation budget amount stayed the same as when we were a family of two, but we now had to make accommodations for a family of five. 

There was little to no wiggle room in this new budget. It made Bryan and me very uncomfortable.

To alleviate some of this financial stress, I drew on my accounting background and started SV CPA Services in 2014. Fortunately, I developed strong client relationships early on and earned a steady part-time income. 

Two years later, we made another major change. My husband became unemployed for a few months, and part-time earnings did not seem sufficient.  

I had spent the vast majority of my career in wealth management and yearned to start a fee-only registered investment advisory firm.  

So I launched WorthyNest® in late 2016.  

Although it wasn’t profitable from day one like SV CPA Services, WorthyNest® helped me come alive again professionally. 

Between the combined income from SV CPA Services and WorthyNest® and a moderate opportunity fund, we were able to step into a new adventure.

We were financially in a place where my husband was able to quit his unsatisfying job... so we could embark on a three-month Spanish adventure in early 2018!

Our personal budget was critical to making informed decisions for each of these dramatic changes.  

As I became more focused on aligning our budget with our values as a family, the whole process became easier.

I'm not saying that I never had uncomfortable feelings. Overhauling a budget because of a life transition is a lot of work!

But by approaching our budget with a strong WHY and clarity on our values, my husband and I were able to make our dreams a reality.

And my belief is that you can too!

Shift Your Perspective

Do you see how a simple change of perspective can make your budget go from foe to friend? Try changing your perspective and see what happens.

Let's summarize the key takeaways from this article that you can start implementing RIGHT NOW:

1. Focus on redirecting your spending toward what you do want instead of on figuring out how not to spend.

2. Clarify your values and align your budget and spending decisions with them.

3. Find the WHY that you can stand behind and return to when budgeting feels uncomfortable.

Now, it's important to remember that an approach is different from a system.

An approach makes the road to reaching your goals easier. This article was all about approach.

But a system is what actually moves you forward toward your goals.

Having a system without the right approach can cause frustration. But having an approach without a system means that nothing gets accomplished. 

Being unable to reach your goals because you have no system is just as frustrating as having an ineffective approach.

So now that you have a better approach to budgeting, you might want a system that works for you.

If you are a beginner at budgeting or just want a super simple system, read our article about the envelope budget.

But if you're earning enough to fund your lifestyle and put something in savings, you may want to check out the detailed budget.

Want to bust the big financial myths that are keeping you trapped? Download the free Starter Guide.