How to Make a Budget Journal and Why It Works.
Have you been struggling to take control of your spending and finances? A budget journal is one method that can help you track your expenses and so much more. It’s also a way to cement your financial goals and get one step closer to making them a reality. Here’s what to know and do.
What Is a Budget Journal?
In its simplest form, a budget journal is a list of income and expenses during a fixed time. It’s also a planning tool and vision board. You might use one side of the page to add and subtract dollars and cents. Reserve the opposite half for a collage of the dream vacation you’ll take once you reach your savings goal.
Once, money reflected the value people considered various goods and services to have. Today, it’s more a means of social control, but a budget journal is a way to bring the original definition back. Think of your money as how you choose to spend your energy. A budget journal forces you to ask yourself, “what do I value,” and assign your funds accordingly.
You don’t have to start your budget journal in a blank notebook. Countless tools can help you get organised, such as:
- The Clever Fox Budget Planner
- GoGirl Budget Book
- Freedom Mastery Wealth Planner
The Psychology of Committing Things to Writing
A paper budget journal, like the ones listed above, is your best bet. There’s power in putting things in writing, sending impulses over multiple nerve fibres. It’s also more efficient. Writing on paper is 25% faster than electronic note-taking. Tracking your income and expenses in a pretty book with room to dream, is far more inspiring than filling out a spreadsheet.
4 Tips for Starting Your Budget Journal
Here’s how to get off to the best start with your budget journal.
1. Categorise Income and Expenses
Print out your bank statements and track your income and expenses. Although many financial institutions categorise expenses for you, you’re ultimately the expert. For example, you may choose to separate workday coffee and meals from outings with friends as a useful way to calculate how much commuting truly costs. Such data is useful for deciding between a higher-paying in-person job and a lower-paying job. The latter allows working from home.
2. Identify Savings Goals
Money is worthless aside from the value society ascribes to it. You can’t eat a pound sterling, plant it, wash yourself with it or build with it. For it to be meaningful to you, you need a goal. What do you hope to save for? A permanent home? A vacation? A new purse?
3. Use Tech to Help You Track Spending
Keeping track of everything you spend using cash is hard. Stick to using no more than two forms of payment — one for personal, one for business — and use the electronic data from your accounts for more accurate record-keeping.
4. Break Down Your Budget
Countless productivity experts advise drafting SMART goals — specific, measurable, achievable, relevant and time-bound. You can incorporate these principles in your budget journal, particularly the last one. Setting daily and weekly goals with larger monthly or annual ones builds accountability and gives more immediate rewards. Saving $150 this month may seem challenging, but socking away $5 a day may feel more manageable.
How to Keep a Budget Journal
A budget journal is much more than an accountant’s list of income and expenses. It’s also a powerful way to make your money work for you and build your dreams. Use these tips to take charge of your financial future.
