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How to Live Within Your Means and Be Happy


The problem with budgeting

For many people, budgeting feels like a chore.

But did you know? If you learn one easy psychological trick, money management becomes easy...

Don't budget. Plan your spending instead!

The word budget automatically means deprivation to most people. The problem with deprivation is that human beings are not very good at self-imposing it for any length of time.

Therefore, it's really important to talk in terms of planning spending. Working out what we have to spend, rather than what we cannot, is much more positive.

The rest of this article is dedicated to showing you how to do that.

1. First things first: where is your money going now?

Before asking yourself where you should cut costs, first, take a look at where your money is currently going.

It's much easier to come up with innovative money solutions, and save, when you know exactly what you're dealing with.

  • What you need to do is note down everything you earn and spend during one month. This will give you a fair idea of how much you'll need for next month.
  • If you keep up the process for a total of three months, then your forecast for future spending will be even more accurate.

2. Use easy tools for tracking

There are many free apps, like YNAB, that allow you to track your spending on your smartphone and computer.

(Many of these not only let you note your expenses and income, but also automatically collate your expenses under different categories, like housing, bills, healthcare, transport and so on, and contrast these with your earnings to give you a monthly balance.)

Alternatively, a spreadsheet – or simply a pen, a small notebook and a calculator – will do just fine.


Let's start with your spending over one month.

If you note down every single penny you earn and spend during 30 days, in the end, you'll have a whole bunch of small and large figures.

What to do with them? To make sense of your expenses, at the end of the month, you need to quickly group all the little expenses under larger headings, and then work out the total spend for each category.

Take a look at the categories below, to see an example.

Scroll to Continue

You'll probably find that your monthly costs fall under some of these basic headings:


Spending Plan to Get You Out of Debt



John Holden on March 21, 2013:

"It is an easy thing to triumph in the summer's sun

And in the vintage and to sing on the waggon loaded with corn

It is an easy thing to talk of patience to the afflicted

To speak the laws of prudence to the homeless wanderer

To listen to the hungry raven's cry in wintry season

When the red blood is fill'd with wine and with the marrow of lambs "

William Blake

sarahd on March 21, 2013:

Thanks for the useful spreadsheet Johanna. The other good reason for living economically is that it tends to be more environmentally friendly. When I am feeling jealous of the fat cats I remind myself that by living more simply I have a smaller footprint on the earth. This can be spiritually satisfying.

Johanna Bergstrom (author) from Fuengirola, Malaga, Spain on March 21, 2013:

Thank you very much! I also liked your hub about family values. Spot on, in my opinion.

Johanna Bergstrom (author) from Fuengirola, Malaga, Spain on March 21, 2013:

Thank you! It's lovely to know you enjoyed the hub. And I LOVE your recipes! Wow! The sweetpotato recipe has gotta be tried ASAP...

Claudia Tello from Mexico on March 21, 2013:

I love your positive approach to budgeting. As you well say, sometimes stretching out our incomes is a matter of spending money in a smarter way.

stephanieb27 from United States on March 20, 2013:

Great hub! I totally agree about changing the mindset! :)

Rebecca Long from somewhere in the appalachian foothills on February 19, 2013:

Your preaching to the choir here. I'm a big fan of budgeting. I think it is good that somebody is out there spreading the word. Nice work.

Michael Tully on February 19, 2013:

I admire your psychological approach to budgeting. Thinking of it as "planned spending" rather than "deprivation" makes it easier to stay on a budget. As the old saying goes, you catch more flies with honey than with vinegar. Voted up, useful and interesting.

Welcome to HubPages, Johanna, and thanks for following me! I look forward to reading more of your articles.

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