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How to Stick to a Budget – Changing Your Habits to Change Your Financial Life

Published: 08 Aug 2019

Sticking to a budget is one of the easiest things to do on paper, but when it comes to actually putting it into practice, many fall at the first hurdle. Managing money is an essential part of life and one which many of us fail to do properly at one point or another in our lives. Struggling to get a hold on your finances is nothing to be ashamed of and can improve with the right actions and frame of mind.

Getting yourself into the right mind-set to stick to a budget is the first and most important step to take; if you are not ready and willing to take control of your money, then you are likely to slip up quickly. Read on for some helpful tips to get you into the right head-space for full financial control.

Be Realistic

When looking at any aspect of your usual income and expenditure, being realistic is essential. It’s good to look forward and to set financial goals which will push and challenge you, but at the same time these must be achievable in the first place.

Be prepared to fail every now and again – as life can often bring up challenges you can’t foresee – but also be prepared to pick yourself up, adjust your plan and continue. One un-met goal or unexpected outgoing shouldn’t derail your whole budget plan.

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Set Challenges

Create short-, mid-, and long-term challenges to help you reach your goals. These are important to help keep you on track, and should come with some kind of small reward that you will appreciate once completed. They can be as simple as ‘don’t spend any money on take-away food this week’, to more challenging goals like, ‘save 10% of my earnings this year’. Completing these challenges, even the small ones, all help you to get to where you want to be and will create a positive feeling around budgeting, thus helping you be more successful.

Visualise Your Budget Goals

Rather than keep your goals in your head, get them down on paper or in your phone. Many people like to create a mood-board or keep a selection of inspirational images and quotes in a diary, on the fridge or in their wallet to help them stay focussed on what they want to achieve. Having some kind of visual reminder helps to keep new behaviours fresh in your mind and is a good way to stop yourself from slipping back into old habits.

Consider Switching to Cash

Where possible, try to use cash for your small daily expenses, rather than a bank card. This can really help you to see exactly how much money you have left. This can be a very useful method if you know you need to be strict with yourself – by only taking the cash you are allowed for that day, you cannot physically spend any more. It can help you get used to a new spending limit much more easily than if you were to pay by card.

 

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Hold Yourself Accountable

Unless you are ready to be strict with yourself, then you may find it difficult to stick with new spending habits. One way to stay motivated is to tell someone what you hope to achieve. You don’t have to go into any fine details, but just voicing your aims can help to make them feel more ‘real’.  Ask a trusted friend or family member to check in with you about how you’re doing – if you know this is coming, you’re more likely to stick with it long enough to create new habits.

If you’d prefer not to tell anyone about your financial goals and budgeting issues, you can always display your goals or ‘rules’ somewhere in your home as a reminder to yourself.

Use Multiple Accounts

Many successful budgeters use more than one current account for their everyday expenses. While this may sound like it makes things more complicated, it can in fact make it much easier. When you have two current accounts, for example, you can use one for your main direct debit payments (such as your mortgage/rent, utility bills, insurance etc.) and one for your spending money (food, entertainment, clothing etc.). By transferring the rest of your wages to your spending account, you’ll never accidentally use money that was destined for an essential payment again. This is a great thing to do if you have trouble curbing your spending.

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Make Your Money Go Further

One of the easiest ways to stick to a budget is to have more of a budget to work with in the first place. As it’s not always easy or possible to increase the amount you earn quickly, it is possible to make more room in your existing budget. You can do this by reviewing what you spend in each area of your life – even if you can shave off just a few pounds here and there, it’ll all add up to a more significant amount over time.

Use comparison sites where possible to find out if you can save some money, and don’t forget to search for special online deals, sign-up bonuses and cashback to really make the most of the switch. You could be surprised at how much money you’re able to save, especially if you’ve never reviewed your providers before. Many sites now offer a switching service to make it as easy as possible to change who you’re with; you’ll not be lumbered with a ton of paperwork or left without service.

Once you start finding areas where a reduction in spending is easy to implement, you’ll find you’ll want to carry on and apply the same principle to every area of your budget. Take it one step at a time so that you have time to adjust to your new spending habits and expense amounts, and always remember to cancel old direct debits and standing orders that you no longer need, just in case.