5 Rules for Building a Budget That Stops You From Going Broke

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1. Know Exactly How Much You Earn and Spend

If you don’t know where your money’s going, it’s probably going everywhere.

Tracking income and expenses gives you control. And honestly, it’s the difference between “I think I can afford this” and “I know I can.”

Here’s what to do first:

• List all income sources: Paychecks, side hustles, bonuses, everything.
  
• Track every expense: Bills, coffee, groceries. Write it down.
  
• Compare totals: Make sure more money comes in than goes out (shocking concept, right?).
  

👉 Here's How You'll Do It: Grab your bank statements from the past month and list every expense by category. This alone will surprise you.

Make It Easy: Use a monthly budget planner notebook with columns for income, bills, and spending. It’s satisfying to fill in by hand.

2. Write Down Your Fixed and Variable Expenses

Budgets fail because most people forget the sneaky stuff.

Your Netflix subscription and your random Target run both count. They just hit differently.

Here’s how to break it down:

• Fixed expenses: Rent, car payment, insurance. Same every month.
  
• Variable expenses: Groceries, gas, eating out. These jump around.
  
• Irregulars: Birthdays, holidays, annual renewals. Plan for them early.
  

👉 Here's How You'll Do It: Write down every fixed and variable expense for the next 30 days to see what’s predictable and what’s chaos.

Make It Easy: Use a desktop expense tracker pad to quickly jot down daily costs for each category without opening your laptop.

3. Save First, Spend What’s Left

If you wait to save after spending, you’ll be waiting forever.

Paying yourself first guarantees progress. Even when life gets “oops” expensive.

Here’s how to make it effortless:

• Set an automatic transfer: Move money the same day your paycheck lands.
  
• Start small: Even $25 a week adds up faster than you think.
  
• Forget it exists: Out of sight, out of temptation.
  

👉 Here's How You'll Do It: Schedule an auto-transfer to savings the same day you get paid. Before you open Instagram.

Make It Easy: Use a Betterment Cash Reserve Account to automate savings and earn interest while you sleep.

4. Set Realistic Spending Limits for Each Category

Let’s be real. You’re not giving up coffee, so make room for it.

A good budget fits your life, not the other way around.

Here’s how to make it stick:

• Create categories: Groceries, fun, bills, gas. Nothing too fancy.
  
• Set flexible limits: Enough to live, not enough to spiral.
  
• Track weekly: Small check-ins prevent big regrets.
  

👉 Here's How You'll Do It: Open your phone’s notes app and set spending limits for each category based on last month’s totals. Adjust weekly.

Make It Easy: Use a cash envelope wallet to divide your spending money into categories. When it’s gone, it’s gone.

5. Use Cash or a Debit Card Only

If your credit card feels like free money, that’s your red flag.

Cash or debit keeps you honest. It stings in the best way.

Here’s why it helps:

• Instant feedback: You’ll see the money leave your hand.
  
• No surprise debt: You can’t overspend what you don’t have.
  
• Simpler tracking: Every dollar spent is visible right away.
  

👉 Here's How You'll Do It: Leave your credit cards at home for a month and use only cash or debit for everyday spending.

Make It Easy: Consider a stylish mini cash pouch for carrying just your daily spending money. It limits impulse buys.

📌 SAVE IT FOR LATER! 📌