7 EASY Budget Hacks that Make Life Easier!

I've said this several times on this channel, but the number one tool that helped me pay off $35,000 in student loan debt in two and a half years on a $37,000 income was my budget. And so I wanted to share seven easy budget hacks that is just going to make life very simple for you and help you on your debt-free journey. Let's do this. Hey, what's up guys? It's Justine with Debt-Free Millennials, the channel to help you crush your debt and live payment-free. And the biggest thing that is going to help you pay off your debt and hit your financial goals is your budget. A written budget is just going to help map out your money so that you have a plan and you can have something to refer to as life gets crazy and busy. You have your budget to look at, and there are some hacks that I want to go over in this video to help it make it just easy sailing. The first hack is to keep your budget in a spreadsheet. Now, the biggest reason why I like using a spreadsheet is because I can easily move things around very quickly and I can see those changes almost instantaneously. Also, it's a really good idea to use a spreadsheet because then you can duplicate the budget from a previous month and use it for subsequent months. Another idea that you can use and what I've done is I've created mock budgets. So I will duplicate a spreadsheet tab and then create a mock budget if I am moving. So for example, I did this when Kyle and I were deciding to move from Manhattan, Kansas to San Diego, California, and we said what would our budget look like knowing the rent is higher, groceries, and all of these things is just a little bit different cost in San Diego than it is in Kansas. What would that look like with a new paycheck and new income levels, new expenses? So it's a really good idea to use a spreadsheet to create mock budgets for this purpose. Also, it just makes changes to your budget a lot easier when you're using a spreadsheet. If you want to increase your restaurant budget or decrease the amount of spending on shopping, you can do that very quickly inside of a spreadsheet. The second hack is to budget for infrequent purchases every single month. So you may have infrequent purchases throughout the year, such as your yearly subscription to Amazon Prime, your car insurance premiums if you pay that every six months. Kyle and I have jeweler's insurance on my wedding ring and we pay that annually. So how do you make sure that you have enough money for that month when those types of purchases come up? The answer is to budget for it every single month. So for example, my car insurance premium is $372 every six months. So I take $372 divided by six and so I need to put away $62 per month for my car insurance premium. So that money just gets saved into a separate savings account and then when I'm ready to actually make that payment, then I can pull that money out, $372 and it's done. It's a very easy way to budget for those infrequent purchases when you build in a monthly payment to yourself inside of your budget. The third budget hack is to automate your savings contributions and you can add that directly into your budget. So I do this primarily for a lot of my future savings goals. That includes vacation, when we were fully funding our second car purchase and our down payment. So I would just set the amount that I want to save every single month and then I would go inside my bank. Now, I'm using Ally and I have a high yield savings account. So I go into Ally and you can actually do automated monthly transfers. Actually, you can pick the frequency. You can do monthly, bi-weekly. You can pick the frequency of how often you want that money to be transferred into your high yield savings account and then I have that paired up with my checking account with a different bank. It's awesome. They actually work together and then I can make that transfer and I can put that inside of my budget so I know, okay, every single month, $500 is going towards my Ally high yield savings account for the down payment and then another $250 is going towards my Vanguard investment into my bond index funds and it's done. Very, very easy way to hack your budget by creating automatic savings contributions. And along those lines, budget hack number four is to keep those savings inside of your budget and what I like to do is add all of my savings goals inside of the future section and then I can see how much I've been saving each month and then I keep a running total of how much I have in total for each of those savings goals. Now, I like to do this manually. So what I mean is I go into my spreadsheet, I open up my bank account statements and I see what is the balance in each of those savings accounts. Now, that's another hack, not so budget related, but yeah, kind of budget related, is that you can have separate savings accounts for each big savings goal that you have. So I have a separate savings account for my down payment and for my Jeep and I can see exactly this money is earmarked for the house, this money is earmarked for the second car and I know exactly how much money is for each of those goals. Your fifth budget hack is to add a Fudge category. Now, Fudge is lovingly named after Ralphie's famous lines in A Christmas Story of when he flips over the nuts and bolts from changing the flat tire with his dad. So Fudge is that miscellaneous category, that buffer of money in case you go over budget in any of your other spending categories. Now, you can have a $100 Fudge buffer, you'd have $10 if you're really good at your budget. It's just a good idea to have this money set aside in case you need to change things around and in case things get overspent when you didn't mean to. It keeps you in line so that you aren't in the negative for your monthly budget. The sixth budget hack is to take an average of your utilities bills and save for it monthly or earmark that money on a monthly basis. So you can do this for electricity and water bills. I really like doing this for my electricity bill because when you take an average on those months that you have a lower electricity bill and when you have it as a higher electricity bill, it all kind of evens out and you know roughly how much you are spending in electricity or water for that particular month. Now, I like to set aside around $70 to $80 per month for my electricity bill. We have a two-bed, two-bath apartment and we live in San Diego where we're not running our air nearly as often as somebody who might be living on the East Coast or in the Midwest, especially during those winter and summer months when it gets really hot and really cold. So I like doing this because it makes those categories a little bit more predictable and you can see exactly, okay, this is the average. If I go over by 20 bucks, then I'm going to make up for it in a month where I spent less, $20 less than my average. All right, your seventh budget hack and this is my favorite one is to add a fun category. Now, one of the biggest reasons why people don't stick to a budget and they abandon it is because they don't give themselves a fun category which I think is ridiculous. You have to still live your life even if you're going through your debt-free journey or you are putting money aside for retirement and savings. You still have to live in the moment and be present and one of the ways you can do that is by adding in a fun money category. So you can do this if you have a spouse or you're sharing your finances with a significant other. You can do this together or you can keep them separate such as Justine has fun, Kyle has fun and then we each have $100 that we can spend on anything we want, no questions asked, right? Or you can keep them together and use that as a way to spend money on maybe going out for happy hours or taking surf lessons or going to the movies. Whatever you consider fun, add it into that fun money category. I think that's really going to help you with your budgeting and not feel so constricted with it that you know that you are still living in the present and you're having a good time. All right, those are my seven quick and easy budget-friendly hacks that just make life a little bit simpler, a little bit easier to manage so that you can stay on a financial journey that just feels good. So I want to know in the comments below what's your number one budget hack? Is there something that you are doing that maybe I didn't mention in this video that you found makes life a bit easier for you? Let me know in the comments below. If you like this video, give it a thumbs up. I'll catch you in the next one.