Expert Advice on How to Actually Stick to Your Budget

Setting a budget is hard. Actually sticking to it? Ugh! One key, according to financial experts, is to make your budget as thorough as possible. The hard work you put in will help ensure your are able to follow it. Here is some expert advice on how to actually stick to your budget:

"A budget includes sources of income and a list of all expenses -- both fixed and flexible," said Sasha Grabenstetter, AFC, financial planning education consultant at eMoney Advisor. "Fixed expenses -- such as a mortgage or car payment -- are the same dollar amount each month, and flexible expenses change month to month. [These] include groceries, gas, daycare expenses or entertainment. It's also important to account for occasional expenses that might occur only once or twice a year, because they can make your budget out of balance if you do not prepare for them."

"There should be a line item for each applicable type of savings account, such as emergency funds, new home/car deposit, business taxes not being withheld, travel/vacations, individual retirement account (IRA) contributions and investments," said Sallie Mullins Thompson, principal and managing member at Sallie Mullins Thompson, CPA PLLC.

Once you've established what items should be on your budget, figure out how much should be allotted to each line item. Grabenstetter recommends using the "look-back method" to determine how much you should realistically dedicate.

"The look-back method evaluates spending habits from the previous three months and helps make predictions moving forward," she said. "For example, a person who averages $400 per month on groceries over the past three months should consider budgeting that same amount the next month."

On the other hand, if you feel you are overspending in certain categories or not meeting savings goals, you may want to establish new limits for yourself in the coming month.

"Another budgeting method is following a rule of thumb," Grabenstetter said. "The financial planning group at eMoney recommends the 50/15/5 rule. According to the rule, 50% of take-home pay is allocated to essential expenses, 15% of pre-tax income -- including employer contributions -- is saved for retirement and 5% of take-home pay is used for short-term savings. The remaining income (30%) can be saved or used for discretionary expenses. This method can help show individuals what they should strive to spend, but ultimately, it may not work for every person or household. In the end, a budget should either balance to zero or have extra income left over. A financial professional is a good resource to help people determine the budget that works for them."

Once you've established your budget, the best way to stick to it is to actually use it. Track your spending and saving and look back on your behaviors on a regular basis.

"Budgeting doesn't have to be tedious," Grabenstetter said. "By tracking actual expenses over weeks or months to see how much you're spending, you can evaluate where adjustments are needed. Checking in on your budget weekly, whether by yourself or with a spouse, can help you stick to it."

For more expert advice, read the full article here.

When it comes to budgeting approaches, one size does not fit all. The best way to stick to yours is to make sure it fits your life. It doesn't matter HOW you set your personal or family budget. Once you have one, the trick is following it. Hopefully, these tips from financial experts can help!