Create A Successful Budget Fitness Plan – With Free Tools

By Leah Drewcock, Licensed Insolvency Trustee

Which word is more cringe-worthy to you, budget or diet?  Sadly, for many of us, we view those words with the same disdain.  

We all know how important budgeting is, so why do we keep failing at it?  My take on budgeting is that we avoid it because we think it is too much work and we have enough work in our day already.  What is the reward for budgeting?  Much like exercise and diet, we tend to avoid the things that are best for us if we see them as work. 

Think about how when starting a new exercise routine, you get yourself prepared by making sure you have the right tools and time set aside.  You might feel excited about starting a new journey so the first few days or weeks you are motivated and pleased with yourself for finally committing to an exercise routine.

Then, after a few sessions you may start to feel less motivated; maybe you aren't seeing the results as quickly as you like, maybe it is starting to feel like work.  Pretty soon, you are skipping workouts, making excuses and before you know it, you have quit altogether. 

So, can the same things that help us stick to an exercise routine and healthy diet help us to succeed at budgeting? 
Yes!

Build a Solid Budget Routine

The same characteristics of a successful exercise or healthy eating plan should be present in the tools we use for budgeting:

• Goals – Why are you budgeting? Do you want to pay down debt, do you want to save for a big purchase or vacation?  Maybe you want to do all of these things. The budgeting tools you use should allow you to set specific goals in multiple categories (spending, debt repayment, saving and investing) 
• Record progress – A major part of budgeting is recording your expenditures. A good budgeting tool should allow you to record your expenses and track your progress towards achieving your goals
• Easy to use –  Budgeting should not be complicated. The tools you use should be user friendly and accessible on your mobile device, tablet or PC. Many apps can import data from your bank account, utilities accounts and credit cards to update your budget automatically. Some tools allow you to upload receipts from a photo or scanner.
• Timely feedback – Timely feedback and prompts help keep you on track. It is important to schedule a time every day or every week to track your spending, pay your bills and review your budget. The right tool for you may have built-in reminders to pay your bills and notifications when you have a deadline approaching or if you have exceeded your budget in a particular category

Free Tools

For as many different exercise plans out there, you will find as many budgeting tools.  It is important to find the one that works best for you or you won't stick to it.   

Apps

There are paid and free apps or mobile phones and tablets that work with both iOS and Android platforms. Some of the more popular and free apps include:

• Mint – Key features include automatic updates from your bank accounts and credit cards, tracking and paying bills, creating budgets, free credit score, alerts and advice to help you save: https://www.mint.com/
• PocketGuard – Key features include connection to your bank accounts, analysis of spending and recurring payments, charts to show spending patterns https://pocketguard.com/
• BudgetSimple – Basic plan is free and can be used on-line -features include budget creation and reports; for additional monthly fee you can link your bank accounts and download a mobile app. https://www.budgetsimple.com/
• Your financial institution may have an app for you. Visit your financial institution's website and see what tools are available to you for free. Many banks have apps that link directly to your account.

Additional on-line tools

• Financial Consumer Agency of Canada - Offers free tools to help you budget: https://www.canada.ca/en/services/finance/tools.html
• Practical Money Skills – Educate yourself on all things money related and download the budget worksheet to track your spending. Free financial literacy materials available: https://www.practicalmoneyskills.ca/
• Canadian Budget Binder – Free downloads and money saving tools: http://canadianbudgetbinder.com/free-tools/ 

If you prefer to put pen to paper, you can print any of the downloadable expense trackers and budget forms and fill them out manually. If you struggle to remember to keep receipts for small purchases, try keeping a small notebook in your purse or pocket and whenever you make a purchase write it down. Then you can transfer these expenses to your worksheet when you get home. Cross check your spreadsheet with your monthly bank statement to account for expenses you may have missed and for automatic withdrawals and bank fees.

What else do I need to know about successful budgeting?

• Keep it simple and be realistic, don't set yourself up for failure. Setting unrealistic spending limits or savings goals can cause you to give up when you don't reach your goal. Instead, track your spending for a month or two, then set spending goals. Make sure you have emergency fund savings built into your budget so you have some flexibility if your spending exceeds the targets you've set.
• Identify roadblocks, avoid them. What are your weaknesses when it comes to spending?  If you love going out for lunch, make an effort to pack your lunch and tell your friends or colleagues what you intend to do and garner their support, so they aren't nagging you to join them for sushi every day.
• Educate yourself. Get to know how your interest and payments are calculated and what fees you are paying for the luxury of having access to credit? Review your statements and card-holder agreements. Are you paying more than necessary for interest or annual fees?  Can you increase your monthly payments to pay down your debts more quickly? 

Finally, you are bound to experience budgeting ups and downs. Remember, budgeting requires long-term dedication. Don't give up – like diet and exercise you must keep trying; you don't usually achieve your goal weight in a month and you don't master your budget in a month either.  But with perseverance you can achieve your financial goals and live debt-free!

Leah Drewcock is a Licensed Insolvency Trustee at our Prince George location. To learn more how Leah can help, contact her at leah.drewcock@mnp.ca or 250-596.4901.

This article was written for MNP Ltd. and was originally published here.

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