How to Live on a Structured Budget Without Going Crazy

Managing your money can be fun (and very easy). Here is a simple way for beginners to plan your spending.

Instructions

Difficulty: Easy

1. Create a calendar. It's best if you use a traditional wall calendar format on regular paper.
2. Figure out how much you make each work day after taxes. (Your net daily wage) $15 an hour for 40 hours is about $80 a day, 5 days a week.
3. Block out each work day with your spending. If rent is $400, and you make $80 a day, block out 5 days on the calendar. RENT, RENT, RENT, RENT, RENT. If you pay $80 a month on gas, block 1 day out on the calendar. Repeat for all expenses until all work days are full.
4. Don't forget to add "fun", "savings" or scheduled special events like birthday presents.
5. Create a calendar for the next three months. Do it in one sitting.
6. Carry that month's calendar around. When you want to spend unbudgeted money, refer to the calendar and see where you can "get" the money. Update the calendar.
7. Start thinking of your money as blocks (aka days) and refer to your calendar often.

Tips & Warnings

• This is a very positive method of budgeting. If you like clothes, and you spend $80 a month on them, block it in.
• Carry it with you. You blocked $80 for clothes, you want to buy a $80 pair of jeans, refer to the calendar. Decide if you want to blow a block (aka day's wages on one item).
• Mentally keep track of your blocks. $80 on clothes block At $10 an item, you can buy 8 items a month. Spend accordingly.
• Block to match your paychecks and due dates. Rent due on the 1st, but you get paid on the 5th, block the days prior to your previous paycheck.
• Block in your debt, focus on reducing it.
• Let your friends know how you are managing your money.
• Read "Your Money or Your Life" by Joe Dominguez and Vicki Robin