How to Build a Budget When You’re Too Overwhelmed to Look

It took me years to finally sit down and make my own budget. Not because I wasn’t interested in money, but every time I’d try to confront my finances, a low hum of anxiety would creep into my mind and make me want to shut the laptop and go do something else. If you’re in that exact place right now, please let me say this to you first: You aren’t lazy and you aren’t bad with money. You’re stressed out, and stressed out people tend to avoid. This is how we’re wired. So work with that fact, rather than against it.

Start with one number, not forty

Most people picture a budget as a large spreadsheet with 40 lines and columns for everything from toilet paper to gum. No wonder we freak out. So don’t start there. Start with one number: how much money comes in each month after taxes? If your salary is stable then that’s the number on your bank deposit. If it varies wildly, use the smallest month over the past six months. Certain money always wins when compared to uncertain hope.

One number is all you need for a base to build from. That number is probably sitting in front of you somewhere. Don’t worry about needing an accounting degree to figure it out. Just look at it once.

Draw a rough outline of your month

Your ultimate goal when using your take home pay number isn’t perfection; it’s a loose outline you can operate within. One very basic way to break down a budget has been used for many years. Send about 50% of your take home pay to the things you need (food, housing, transportation, minimum debt payments). Send about 30% to the things you enjoy (travel, dining, hobbies) and the remaining balance goes towards saving money and paying off debt quickly. These percentages aren’t set in stone. If your rent consumes more than half of your paycheck, then you need to draw a new outline. And that’s perfectly fine. The most important aspect here’s to identify the overall categories, not to police each individual dollar.

Why the rough outline beats the details

Knowing generally where your money should be going means that a surprise expense won’t feel like a personal failure but rather a math problem that can be solved. Math problems are easier to deal with at 8pm than feelings of guilt or shame.

Automate the boring parts

Budgets that stick are the ones you don’t have to spend brain power thinking about. After you’ve drawn a basic outline for your money flow, set the portions of your budget that you normally would have to constantly think about to happen on their own. Set your savings transfers for the day after payday (even $20/month is enough to learn about your own financial behaviors) and set your fixed expenses on auto-pay so they’re no longer decisions. The money that remains in your checking account is for spending money, and you can spend it without having to perform math in the grocery line.

You need to begin smaller than seems impressive. Transferring $20 per month automatically will educate you more about your own financial behavior than a “perfect” plan abandoned after two weeks. Transferring actual money ($20) beats transferring idealized amounts ($200).

When the number terrifies you

There may be times when you look at your budget and realize the deficit is real. More is going out than coming in, and no matter how hard you round that number, it still doesn’t fix it. I’ve been in that spot myself, and I’m not going to pretend that anything makes the anxiety of seeing a deficit disappear. But I’ll tell you what the deficit number is for. It’s not there to scare you; it’s there to give you an accurate measurement of how deep of a hole you’re in, so you can quit imagining a never-ending chasm and start dealing with an actual boundary.

At that point, you’ll have real options: trim some of your fixed costs, bring in extra income, or negotiate with creditors before making another payment late (which surprisingly works more often than people assume). None of these options are enjoyable. All of them beat pretending the problem doesn’t exist.

What Nobody Told You

Creating a budget isn’t punishment, nor is it a reflection of your character. Creating a budget gives you permission to spend on things that bring joy without that little voice in the back of your head whispering “you shouldn’t”. Once you experience that feeling, the fear begins to dissipate, and you no longer avoid opening your laptop.

Tonight, don’t create the 40 row budget. Find your one number. Draw your rough outline. Automate one small transfer. This is creating a budget based on reality, and you can expand from there. Your future self, the one who isn’t scared to look anymore, is going to be so glad you started.

Photo by Jakub Żerdzicki on Unsplash