By Amante Reale

September 1, 2015   •   Fact checked by Dumb Little Man

“Make a budget” is one of the most often repeated personal finance tips but, just like “eat more greens”, very few of us actually follow it even though we know it’s good for us. The reason, of course, is that unless you’re someone who gets an adrenaline shot from juggling numbers, odds are that even the thought of sitting down and writing down a monthly budget is giving you a panic attack.

I know, because I’ve been where you are.

Even worse, when you do write that budget, and stick it to the fridge (or whatever the digital equivalent of that may be), it’s still an extremely tough challenge to stick with it. Budgeting may be hard, but living within it is even harder.

Luckily, it doesn’t have to be. Today, I would like to share with you a few secrets on how to simplify your budget. These hacks have done wonders for my budget and peace of mind, and I am absolutely positive they will do the same for yours.

The most important goals here are: one, to reduce headaches when initially creating and updating your budget (you know you have to keep it updated regularly, right? …right?); and two, to reduce the time you spend stressfully playing around with numbers and replace that with time spent playing with your kids. Or your PlayStation, if that’s more your thing.

So, let’s do this.


Have you been convinced that in order to budget correctly you need to specifically figure out each and every type of expense category beforehand? Does the idea of allocating different amounts of money to “Meats”, “Frozen Food”, “Fresh Groceries”, and “Snacks” make you want to throw up and binge eat gummy bears?

Well, it should, and the funny part is there’s really no reason why you should be so specific with your categories. Some articles might have you thinking that you have to either figure out every single thing you might need and budget for it, or you can just declare bankruptcy and be done with it. Luckily, that’s not the case.

Instead, try using broad categories to greatly simplify your budgeting process. Instead of “Cinema”, “Paintball” and “Eating Out”, try writing down one category and calling it “Fun Times”. Now you can assign an amount of money or a percentage of your income to that one category instead of a thousand. As you go about your month, make sure your total “Fun Times” expenses do not exceed the amount you set and you’ll be golden. If you want to watch the new Avengers movie just don’t eat out next week and you’ll be fine. Having a ton of different categories means you need to waste a lot more time juggling money around. That’s the exact opposite of “Fun Times”, if you ask me.


Today, you can pay most of your bills online, a lot of which you can even pay automatically via a recurring “subscription”-like system. This can include anything from utility bills to insurances to your tablet’s 4G service. Whatever you can pay automatically and online, pay it that way.

Protip: If your service provider or vendor doesn’t accept online payments, you can always ask your bank to mail them a check on your behalf.

Similarly, automate any savings you can. Have a scheduled transaction set to your favorite time of the month (ideally, the day after payday) and the amount will automatically be deducted from your paycheck. You can handle your long-term savings accounts and your rainy day funds like this so you won’t have to do it yourself.

The main advantage with automating your payments and savings is of course saving time. But you also get the added bonus that you can’t really do anything about it (such as impulsively deciding you don’t need to move all that money to your savings account after all, and instead want to blow it all on that totally sweet TV you saw on your way home).

Think of the scheduled transfer as a very strict budget bodyguard/butler combo that both saves you from yourself and handles your most important savings and payments without you having to lift a finger.


As much as we enjoy living in a paper-free world, cash still has many uses. One of the most important uses for someone who’s trying to stick to a budget is keeping your impulse buys in check.

Paying for something by credit card is easy, and that’s what the credit card companies are banking on. It’s sleek, it’s cool, and it’s so easy to pull out a credit card and buy a new TV. It’s almost like you’re being rewarded for buying things. But with cash, it feels like you really are forking out that hard-earned money. You can feel the paper judging you as you pull that cash out of your wallet.

No-one wants that.

If you’re worried about having to run around with a bunch of money, don’t. One, I’ve got the perfect solution for you in the next hack, and two, if you’ve setup your automatic savings and payments as explained in hack number 2, then you will probably only end up needing cash for gas, groceries, and for activities in your “Fun Times” category. It shouldn’t be all that much.

Just head down to the ATM two or three times a month, withdraw whatever amount of cash you’ll need for the next week or two, and you’ll be fine. If you follow hack number 4, you’ll only have to do this once a month. Nice.


My fiancée was the first person I’d ever seen use this system and, I must admit, at first it looked silly and a little overkill. But I was immediately sold when I saw how well the system works. It’s effortless, quick, and it goes like this:

1. At the beginning of the month, grab an envelope for each of your cash/spending money categories. These are categories like “Groceries” or “Fun Times”.
2. Write down one category name on each envelope and, underneath it, write down the amount of money you have budgeted for that category.
3. Withdraw the total amount of money you need for all your envelopes, then put the designated amount of cash into each envelope. For example, one envelope will have “Fun Times” written on it, “$80” underneath that, and will have exactly $80 inside it. I told you it was simple.
4. When it’s time to do something for which you have an envelope for (for example, buying comic books), take the cash money out of the envelope, go do your thing, then come back and deposit the remaining money back into the envelope.
5. For bonus points, every time you deposit remaining cash update the amount of money written on the front of the envelope. Now you won’t need to open the envelope every time you need a recount.

This way you’ll know exactly how much you’re spending, how much money you have left for each category, and it’s easy to rebudget on the fly without having to break out the calculator. Just take money from one envelope and put it into another.

I do not suggest messing around with the envelopes after you’ve set them up as you can easily end up giving too much priority to one category at the expense of another. But the option is there if you suddenly realize you have made a terrible mistake in your original budgeting process.

If you often find yourself transferring money between envelopes, I suggest taking it into account the next time you’re updating your budget.


One of the biggest issues with regular budgeting (which I have started to call 100% budgeting) is attempting to budget everything into 100% of your household’s income. When you’re trying to figure out the percentage ratios between groceries and long-term savings things get a little hairy.

This is why MSN Money’s editor-in-chief, Richard Jenkins, came up with a method called “The 60% Solution”. The beauty of this method is that it includes the broad categories explained in hack number 1, and it gives you a lot of breathing room. Here’s how it works:

1. 60% Fixed Expenses: Take 60% of your total gross household income and and assign it to fixed expenses. This includes things like federal, state and Social Security taxes, insurances, loan repayments, bills, food and clothing.
2. 10% Retirement: This is money you put aside for retirement by putting it into plans like an IRA and 401(k) (or your country’s equivalent).
3. 10% Long-Term Savings: If you are in debt, this 10% goes to clearing that debt. Always clear debt first and foremost. If you’re debt-free, then this goes to long-term savings such as investments and rainy day funds (a relatively small amount of funds you can tap into if you’re having a particularly bad month). Even if you are in debt, a small part of this 10% should go into building up your rainy day funds.
4. 10% Short-Term Expenses: This money is spendable and should be used for things like auto repair, holiday and birthday gifts, vacations, new appliances and that pretty cool TV you’ve wanted since hack number 1. Just make sure you’re not overspending and always keep tab of where your money is going. That’s super easy if you’re doing the envelopes thing.
5. 10% Fun Money: The greatest kind of money, am I right? Do whatever you want with this money, guilt-free. Eat out, buy toys, get a new hideout for your pet snake. Whatever makes you happy, do it with this 10%.

In the end, it is all about reducing the headaches and stress of budgeting and staying within that budget. Much like a diet, it might be the greatest thing ever, but if you can’t stick to it then it’s of no use to you.

Hopefully, these 5 hacks will help you simplify your budget and allow you to live a more hassle-free, but financially responsible, life.

Amante Reale

I'm Pen-Man, writer extraordinaire, and I use my powers to help you get more subscribers, more customers, and more sales through your website and your blog.

Getting Started with Money

Learn More About Money

More on Money

Money Individual Reviews