Before we dive in, let’s talk about what budgeting is and is not.
But I have great news: Budgeting is not about math. Budgeting is more like resource management. Think of a video game where you know you need to save health potions for the final boss fight. If you look at it that way — I’m not doing advanced formulas; I’m just deciding my priorities and gearing up to defeat my debt — budgeting is not scary. It can even be a tiny little bit fun.
A lot of people also like to have a cushion. If you want to, say, always have $500 “left over” in your checking account, make a $500 “cushion” category. I don’t do “cushion,” but I do have “stuff I forgot to budget for,” where I categorize the inevitable things that don’t really fit into any of my other line items .Look at your total income, and then add up your total expenses. Are these numbers the same? Great.
The only way to budget “wrong” is if you don’t budget for what you actually spend. You aren’t setting yourself up for success if you decide today is the day you become an entirely different person. If you regularly spend $400 a month on groceries, it’s not very realistic to set a goal that you’ll spend only $75 this month.