I haven’t seen a system this simple in quite some time, or at least one I thought was good enough to share. If you haven’t found anything that works for you yet, this may be a good place to start!
All it requires is a few accounts, and a visit to your HR department to set up direct deposits (or if you don’t have one or work solo, you can just automate it yourself by going online through your bank. Or just keeping it manual each month, though that kinda takes away from the simplicity, haha…). Here’s what Money Mag, and now J$, recommends:
The Bucket Budget:
- Savings Account — Throw all the money you want to save every paycheck right into this bad boy. We start here because it’s all about paying YOU first before paying everyone else. One of the fundamental rules of personal finance (and one of the hardest to stick by! Haha…)
- Checking Account #1 — This is for all your daily expenses, and everything you need to pretty much survive (housing, food, utilities, etc etc.) This will be the largest account for most people, and the one you’ll have to keep your eye on the most to make sure you’re not going over (and if you do, you dip into the next account)
- Checking Account #2 — The place for all leftovers! If you should be so lucky to have them, haha… this is where all the money goes after your set savings % (or dollar amount), and your regular daily expenses. Consider this as your “back up” account before having to hit up your savings. You can do whatever you want with this money.
And that’s it! Crazy simple, right? Now obviously when you get THAT slimmed down there’s a lot of things you’re gonna have to watch out for to make sure it’s a good fit for you and all that, BUT it’s certainly a great starting point.
Just keep in mind that you’ll still need to *know* how much to put in, and where. It’s not a magical budget – It’s not gonna track your money for you and then tell you what % to divvy everything up into ;) If you don’t have an estimate of where all your money’s going, or how much your daily expenses come out to, take an hour or so and go back through your last 3 months worth of statements to calculate some averages. Once you have some good numbers in mind, pad it by $100 or two and then jump in and get started!
The cool thing about budgets or any other systems in life, really, is that you can run with one and then TWEAK IT as you go! Nothing’s ever permanent or set in their ways. YOU determine what’s best for you and you get out there and improve on ’em. Whether it’s this budget or another one out there though, you better be staying on top of it and making your friend J. Money happy! :)
Bonus tip: Find a good "balance transfer" offer to help pay off debt faster!
If you’ve been making payment after payment (on time) and still haven't been able to get your debt under control, snatching up a good balance transfer credit card offer may be the ticket to try. That’s where in order to gain your business - credit card companies will let you transfer your existing debt to a new card and let you pay ZERO PERCENT interest on it. Saving you tons every month!
What's the catch? Usually balance transfer cards charge a fee (around 3% of your debt balance) to let you transfer your balance to their 0% interest offer. But we've found a great credit card that will let you do a balance transfer absolutely free. Click here to learn more and see if you qualify!
PS: If you don't trust yourself with another credit card, ignore this! This strategy is to help you get out of debt quicker, not risk adding more to it.