Budgeting: Making a Plan for Your Money

By Amy Andrews McMaster
[Mindful Money]

We have work plans, weekend plans, activity plans, and dinner plans. Yet, many of us don’t have plans to balance the amount we spend with the amount we earn. We live on credit and hope it all works out. Sometimes it does. Sometimes it doesn’t.
If you already have a budgeting strategy that works, kudos to you! But, if your budget could use another look, read on.
Budgeting is really all about being intentional with where your money goes. When we are intentional, we feel more confident—and actually have more freedom. Being mindful about your cash flow promotes awareness, confidence, and a healthier relationship with money.
To increase your budgeting success, invite your partner to join the process, consider finding an accountability buddy, or just schedule a recurring appointment on your calendar to help you create a new habit. Choose a good time for your money date. Grab your beverage of choice, put on some good music, and then add any additional elements to increase the fun and exploration.
The goal of this article is to keep budgeting simple. First, we’ll categorize your income and expenses, then explore a manageable system for tracking them. Once we know what’s coming in and what’s going out, we’ll discuss savings, an emergency fund, and long-term investing.


Write down your total income for the month, after taxes. If you are married, include your spouse’s take-home income as well. Include all sources of income—full-time jobs, second jobs, freelance pay, Social Security checks, and any other ongoing sources of income.


Looking at your expenses can often be a reality check. The point of budgeting, though, isn’t to feel guilty about your purchases but to know where your money is going each month—and to feel good about the choices you are making with it. Mindful budgeting is intentionally directing your hard-earned money to the right place.
Begin with the big categories—home, food and household, transportation, self-care and fun, clothing—and then drill down. You can search online for a monthly expense spreadsheet that suits you, or you can create your own. I think of “home” as all the things in your home that make you safe and secure. If you like, you can have a separate category for utilities. Modify the following categories to work for you.

• Electricity
• Gas
• Home insurance
• Internet
• Mortgage/rent
• Phone
• Repairs
• Water/sewage/garbage

Food and Household
• Groceries
• Household/toiletry items (cleaning supplies, toilet paper, shampoo, etc.)
• Meal delivery services
• School lunches
• Takeout dinners
• Work lunches

• Car insurance
• Car payment
• Gas
• Parking
• Public transportation
• Repairs

Self-Care and Fun
• Entertainment
• Gifts for friends and family
• Haircuts
• Health insurance
• Massage/acupuncture/nutrition
• Meals/coffee with friends
• Pedicure/manicure
• Clothing, shoes, etc.

After you’ve considered all your expenses, slowly look around the room you’re sitting in. What else is important to you: art, pet care, music concerts? There are usually sneaky expenses you will find later. When you do, add them to your list.


Once you’ve accounted for your income and expenses, you’ll need a tracking system. The most important thing about choosing a system is being realistic. You’ll need the will and determination to try something new—and a strategy that resonates with you.
If you are the kind of person who enjoys using an app, try something like Mint, which is a money manager, personal finance, and budgeting application for your computer or cell phone. To find other tracking apps, search the app store, or search “The 8 Best Budgeting Apps of 2019” to find a tracker that works for you.
On the other hand, if you feel you would benefit from a cash system, put your credit cards in your sock drawer for a bit. Then, try an envelope budgeting system. Jordan Page has a YouTube video titled “Simplest Budgeting Method EVER! Envelope Budgeting You’ve Never Seen.” This video is basic and has helped a lot of people.
The bottom line: Choose a system that tracks your monthly expenses—and works for you. Your new tracking system will take a little time and practice, but by your third month, you’ll have the hang of it.

Savings and Emergency Funds

Now, you are ready to consider a savings and emergency fund. Let’s face it, the unexpected can—and sometimes does—happen. Your car won’t start. Your dog needs to see the vet. Or, perhaps your health needs special attention. This is when an emergency fund is key. A $1,000 fund would be ideal, but you choose the amount that offers a little security. Once you have a cushion, you won’t have to panic.


Retirement may seem a long way off, but it is always important to keep it in the mix—even when starting a budgeting plan. Following are two types of retirement accounts you may want to consider.


An individual retirement account (IRA) allows you to save money for retirement in a way that offers tax advantages. You can set up an IRA account at many financial institutions—whether you have an employer-sponsored retirement account or not.


A 401(k) is a retirement savings plan sponsored by an employer. 401(k) contributions are deducted from your salary on a pre-tax basis. This means that by contributing to a 401(k), you actually lower the amount you pay in current income taxes.

Mind the Details

I used to think that budgeting was like a straitjacket that would limit my freedom. Details, details, details—yikes! The truth, though, is that minding the details can offer all sorts of important insights into your life, your values, and your habits. Instead of just ending up somewhere, you can choose your destination. May your money bring you joy!

Amy Andrews McMaster is the director of training and coaching for Conscious Time. Her purpose is to help curious and courageous people awaken to their optimal potential. She loves to help clients transform obstacles, uncover possibilities, and create new solutions. Contact her at amy@conscioustime.com.