How to Budget Without Making it a Chore

Budgets have a bad rap. Somehow, people have gotten “budgeting” and “crash dieting” confused — thinking of them both as something restrictive to be suffered for results. But they’re not the same at all. Here’s how to budget without making it a chore.

Before we start with the details of how to budget, the first step is to think about your budget’s real purpose. You might think it’s to control your spending, but that’s where many people go wrong. (You might or might not need to get your spending under control, but that’s another matter.)

The real purpose of a budget is to help you get the things you want.

Figure out what’s important to you

So what do you want? Go ahead and write a few things down, no matter how unlikely it might seem that you could get them.

Your list could include anything from going on vacation to buying a Lotus Elise. Put down whatever you want, so long as you really want it. Just remember that you’re not making a list for Santa Claus — you’re making a list for yourself. That means you’ve got to be willing to do what it takes to get the things you want. (Things like having money set aside for emergencies and retirement would go here too.)

List your expenses

Listing your expenses is a critical part of figuring out how to budget. But it’s also the part that causes many people to throw up their hands in frustration and give up, thinking that they suck at budgeting. The truth is, you’re probably going to forget stuff. And that’s normal. It’s not a sign that you suck. It’s a sign that you’re a human being, so don’t turn budgeting into an opportunity to beat yourself up. Turn each month into an opportunity to get a little bit better instead.

For now, list the amounts of your actual expenses as best you can, organizing them by category as you go. If you can poke through Quicken for a year’s worth, that’s ideal — but it’s also overwhelming. So just do whatever you feel comfortable with. Look at your last credit card & bank statement, for example.

Don’t worry about getting the “right” categories. Everyone’s life is a little bit different, and there are no budget police. A big part of how to budget without making it a chore is doing what works for you.

Some people use a few general categories, while others get really specific. I’m really bad at grouping things into categories (because everything seems related to to me) so I have a ton of smaller ones. But it’s not the categories that matter; it’s the amount of money that you’re spending.

List your income

For many people, listing your income is the easiest part of how to budget. To make things even easier, be sure you’re listing your take home income, not your stated salary. Write down the amount that you deposit to your bank account. If you’re self-employed, you can either subtract taxes from your total typical income and write that number down, or write down your gross income and include taxes as an item in your budget. (Which is what I do, since my income from other sources varies wildly.)

Get the three lists together

Yes, I said three lists. Remember you’ve got the list of what you want, the list of your known expenses, and the list of your income.

Put your income at the top, and then look at the two remaining lists. Put stuff like a place to live, food, utilities, taxes (if you’re including them) and a way to get to your job at the top. Then list everything else in the order that matters most to you, subtracting from your income as you go.

When you run out of money, you’ve run out of things to buy or do. If you still really want some of the things that haven’t made it onto your master list yet, figure out what you don’t care about as much, and then do some rearranging and/or start bringing in some extra income to cover them.

Budgeting is a process

Budgeting is really just your plan to get the things you want — so go ahead and get them. And as you spend money, write down how much you’ve spent. Keep a running total that acts as your reality meter.

Doing that is important, because budgeting is a process. When you forget something (like that your car insurance is due every six months) don’t slap yourself on the forehead and give up in disgust. Just add it to your master list. As time goes on, those moments will happen less and less.

One day, you’ll notice that it’s all come together.


  • I think that significance is the most important thing that people fail to really take into consideration. It’s like… well, we’re going to do this because everyone else is doing it, not because it’s actually important and it will make our world just that little bit better. Tahnk you for the post! :)

  • I’ve got to say that although it can be somewhat tedious adn initially difficult to set up, but a good spreadsheet with all your incoming and outgoing with a few sums here and there can make life a lot easier, especially if you live in a shared house

    • Getting the spreadsheet itself set up shouldn’t take too long, but populating it could take a little time. Still, as you’ve said, once it’s done it can make life a lot easier.

  • Jim

    “The real purpose of a budget is to help you get the things you want.” This statement is absolutely genius!!! Thank you!

    The one bone I’d pick with you is with your advice that non-self-employeds list only their take-home income vs. including taxes payable in their budgeting process. If we — all of us — only paid attention to what we’re paying in taxes, and what those taxes are being spent on…

    Thanks again for a motivating and empathetic call to action to better ourselves!

    • Oh, I think we should pay attention to taxes. I just didn’t want people thinking “Oh I make $40K a year, so that should give me $1538 per paycheck” or something without remembering that they wouldn’t actually get that whole amount. It’s easier to just grab your paystub and start with that…

  • I like the term “reality meter” that you used. It’s important to track expenses and understand where money goes and what you actually spend – really, as an early step in setting a budget that’s realistic and achievable.

    • That’s definitely an important part of the process. I know that I put off making a budget for a very, VERY long time though because I didn’t want to go back and figure out exactly what I’d been spending money on before I could even start. Once I realized that I could just start with today it got a lot easier.

  • ‘Crash budgeting’ – I like the sound of that, but I’m sure it wouldn’t be very fun at all, haha! I can tell you I’m not hardcore enough to have three lists, but we lean pretty heavily on the electronic help in the form of Mint (and Excel / Google Docs depending on what machine we’re on).

    • Hehe, no kidding! I think crash budgeting could be defined as what happens when you discover you’ve been laid off and you’ve never budgeted before.

  • I JUST did this — and it sucked! Mint definitely helps, though.