4 easy steps to create a successful budget

A budget makes you responsible and accountable for your money and where you choose to spend it.

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Lets be honest, Budgets just aren’t fun. 

If you’re a movie star and you can watch just how much money is coming into your fat little bank account each month, then maybe it is… I don’t know, but for the most part, we budget to learn to save and we do it as a means to achieve a goal.

A well-planned budget can set us up for an easier journey to fiscal freedom or independence and save us a lot of money along the road. 

It will allow us to see where a paycheck is going each month, prepare for unexpected ouchie bills and have stress free lives knowing we don’t have to live off Mi Goreng for a week to make ends meet. Or, a budget can give us a black and white, definitive answer for how long you have to eat Mi Goreng to make ends meet, if you’re that way inclined.

So, its definition as a TL;DR; a budget is a diagram of cash flow income and expenditure over a period of time. It is a financial projection of your position, possibility and security, and most importantly is THE solid backbone to successful saving.

With a good budget, we can easily see how long it is going to take for us to save and what it’s going to take for us to get there. If we can see where our money is tracking paycheck to paycheck, we can discover where money is unnecessarily being spent and therefore a projection of how long it’s going to take us to save our goal amount. And on the flipside, the no-nonsense, analytically consequential nature of a budget clearly shows how a spontaneous purchase affects your goals in the long run.  Want a holiday? No problems, a week here will cost you two more months of saving. Can you hold off on going to the movies and dinner for a couple of months? Awesome, you just saved yourself a month living with your parents.

I guess what I’m trying to offer, is that a budget makes you responsible and accountable for your money and where you choose to spend it.


I cannot stress enough the immense possibility involved in a good budget.

So, moving forward, in a very layman’s terms way, we have all learnt the basics of budgeting already. You can’t buy something if you don’t have the funds to pay for it. So, if you want to buy it, you have to wait until you do have the funds to pay for it. 


A budget is essentially this, but offers foresight that spans months or even years and hits goals and purchases that are tenfold of what we have previously encountered. Added to this, it gives us the ability to plan and accelerate the timeline with sacrifices and smart investing. Which is totally awesome, because I’m terribly impatient.

So let's break down how we can do it.

Plan the planning

a.     Collect all of the financial documents you have. This includes bank statements, receipts, bills etc.

b.    Record all of your income streams. This includes any side jobs you have. Maybe list any items that you can sell here to add to your goal.

c.    Here’s where you want to be as forthright as possible – list all of your expenses. There are the basics, like rent, car, phone etc, but don’t forget to factor in all of the other expenses which we naturally don’t think of as expenses, like food, shopping, audible, netflix etc. going through a bank statement line by line is a pretty good way to document every dollar.

Breakdown the planning

a.     Fixed vs. Variable expenses.

                                               i.     A fixed expense is something that doesn’t really change from month to month, like your rent, car loan or phone payment. You don’t really have much wriggle room with changing these amounts. Variable expenses however, are your foods (My local coffee shop every morning, guilty), Fuel, Entertainment costs etc. These ones are important, because we choose how much we spend each week on these items, and therefore it’s these items that we can manipulate to shorten or accelerate our savings timeline.

Tally all of your income and expenses

a.     A monthly figure of each is a pretty logical and easily workable figure. 

b.    Excel is a brilliant way to list all of our cash flow in tables. Google drive has a massive amount of budget templates from other users that already have working formulas and some great layouts. Have a look on what’s on offer and fill in your details to one that suits you best.

Summarise your cash flow

a.     What percentage of your monthly income goes to variable expenses? Can you see a way to save yourself some extra dosh each month? Can you justify not having that extra coffee a day? I don’t know about you, but at this stage on my journey, I was still happy to spend $30 a month on coffee… until I had a look at how long that extrapolated to in terms of my savings goals. Figure out what percentage of expenses gives you the shortest saving time at the most comfortable financial sacrifice for you, but make sure you stick to it.


Please remember, through all of this, you can have the best budget in the world, but if you’re not integral to it and don’t stick to it like it’s oxygen, it wont work; Which leads to our next blog, How to Keep your Financial Word.

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