How to create a personal budget without dying trying (and without looking like a bank)

Creating a budget sounds as exciting as a Sunday afternoon ironing shirts... but if you want your money to last longer than the iPhone 15 battery, it's something you should consider. The good news: you don't need a master's degree in economics or live like a Tibetan monk to do it. Here's a simple guide to creating your personal budget:

1. What is a personal budget? (And Why You Care)

A personal budget is nothing more than a plan to know where your money is going each month. Imagine it's like organizing a party: you have to know how many guests are coming (expenses), how much the drink costs (bills) and how much you have available to spend without missing Christmas dinner (savings). In short, a budget helps you ensure that you don't get left in the red in the middle of the month.

2. Start with your income (aka: how much do you earn?)

First things first: you need to know where your money comes from. If you have a fixed salary, great, you already have a solid foundation. If you're a freelancer or have variable incomes, you can make an average of what you usually earn per month. Knowing what's coming in gives you a clear idea of how much you can spend without falling into the financial abyss.

3. Identify your fixed expenses

Here we talk about those expenses that you do or do have to pay every month: rent, bills, food, transportation, Netflix subscriptions (because, of course, canceling Netflix isn't an option). Make a list of these expenses, because they will be the basis of your budget. And make no mistake, stop saying that you only “spend little on food” when you eat out three times a week!

4. Don't forget variable expenses

These are the expenses that change from month to month, such as clothes, going out to dinner or that “whim” you buy because, well, you deserve it. Write them down too, even if it's sometimes lazy. Here's the key to finding those little black holes that your money is escaping through without you realizing it.

5. Give a name to your savings goals

Saving isn't just keeping money in a sock under your mattress. You have to have a Why. Do you want to save money to travel? For a car? For the PlayStation 5? Naming your goals will help you to be consistent and not leave your savings halfway. In addition, With apps like Goin, you can automate your savings so you don't even notice that you're saving every month (and without suffering).

6. Follow the 50/30/20 rule

This magic formula is simple but super effective:

• 50% of your income goes to basic needs (rent, bills, food).
• 30% for your whims (that Friday dinner or the concert you don't want to miss).
• 20% to save (or invest).

Divide your income by following this rule and voila! You already have a balanced budget without having to complicate your life.

8. Review and adjust every month

The budget is not something fixed. Every month there may be unforeseen expenses or you can receive extra money. The key is to review your budget regularly and adjust where necessary. If you see that you've been on a whim one month, adjust for the next one. Flexibility is the key word here, but without losing sight of your goals.

Making a personal budget doesn't have to be a headache. With a little organization and the right tools, you can keep your finances under control and ensure that your money lasts all month (and longer). Start today, follow these steps and you will see how your relationship with money improves so much that you even invite yourself to the next round. 😉