What You Need Instead of a Budget

Oh yes, we hate the word “budget”. The word “budget”, for many people, is synonymous with “restrictive”. If something feels restrictive to you, let’s face it – it’s not built to last.

So, what do you need instead of a budget? First, you need financial goals (both short and long term) to work towards. Once you have your goals set, you can create an effective spending plan that will help you save for those important goals while still allowing you to live your life. Last, but certainly not least, you need to check in with those goals and stay consistent. A great plan means nothing if you’re not willing to do the work!

Want to learn more about how to achieve your financial goals AND ditch the budget? Read on, sister!

1.) Set Your Financial Goals

Before creating your spending plan, you need to first identify your long term and short term financial goals. What are some big purchases that you’re saving up for (long term goal) and what kind of lifestyle are you trying to maintain on a daily basis (short term goals)? Setting these goals will help you to create an informed spending plan that meets your needs.

Setting your money goals is an essential part of ensuring financial stability and success. Without specific, attainable goals in mind, it can be difficult to stay on track with your spending and savings habits. Moreover, it can be tough to know when you’ve reached a milestone or achieved a desired outcome.

Here are some tips on how to set clear, measurable financial goals:

  1. Be Realistic: When setting your money goals, it’s important to be realistic. Don’t aim to save $10,000 in six months if you only make $2,000 per month. Start small and gradually increase your goal as you become more financially secure.
  2. Be Specific: Your money goals should also be specific. Saying that you want to save more money is too vague and won’t help you stay on track. You need to know how much you want to save, what the money will be used for, and when you want to have it saved.
  3. Break down your larger goals into manageable steps: For example, say you want to save $1,000 for a vacation next year. You can break this goal down into smaller goals that will help you achieve your larger one. Try setting a goal to save $250 in the next three months, and then another goal to save an additional $250 in the next three months.

2.) Create Your Spending Plan

Now that you have set your money goals, it’s time to create your spending plan. This is a document that will outline how you plan on allocating your money each month. It will help you stay accountable for your spending habits and make sure that you are on track to reaching your financial goals. A spending plan should be tailored to your specific needs and goals. It should reflect your current financial situation as well as your future aspirations.

This is the difference between a spending plan and a budget: A spending plan helps you enjoy the “right now” while also planning for the future, while a budget evokes feelings of sacrificing the fun you want to have now to achieve your goals later.

One of the most important aspects of creating a spending plan is ensuring that your expenses don’t exceed your income. If they do, you will end up in debt and may find it difficult to get out.

If you want some additional help creating a spending plan, check out our Knock Down Debt course for a great template to use.   

3.) Stay Consistent and Check in with Your Money Goals.

It’s not enough to simply create the plan – you have to execute it! Check in with your plan every week to see how you’re doing. If something isn’t working out for you, do NOT get down on yourself or abandon your plan! Ask yourself why this isn’t working and make adjustments, either in your plan or your mindset.

Need help creating a spending plan or staying consistent? We’ve got you! Book a discovery call with us today to learn more about how money coaching can help you implement ALL the good things to help you achieve your money goals.