How To Make A Successful Budget

Every time I tell my Personal Financial Management Workshop participants that they need to make a budget to start with, I always hear comments like this:

“I don’t have enough money to budget.”

“My salary is just not enough for me to make a budget.”

This only means one thing:  Most of the time, our mindset when it comes to budgeting is distorted.  We think about budget as allocating money.  In a way that is true but that also gives you an idea that you don’t have enough money to allocate to all your expenses.

So instead of a budget, look at it as a Spending Plan.  With this mentality you are telling yourself to make a plan on how you want to spend your money for the period or for the month.

What happens here is that you are now thinking of budgeting, not as a restriction, but as a plan to help you finally have the freedom.

So here are some tips that I would like to share with you in order for you to be successful in making your budget:

Monitor Your Expenses

The first thing you need to do is to know where your money is going on a daily basis.  In my sessions, many of my participants are shocked to know that a large amount of their expenses goes to little things like snacks, cellphone load, etc.  It’s always good to know where you are spending your money so you know what to do with it.

Identify Wants vs Needs

Now that you know how you are spending your money, check which of these expenses are wants and which are needs.  It is important to know this so you know which ones to prioritize and which ones to let go.

Make a Spending Plan

Now that you know the details of where your money goes and now that you know which ones are wants and which ones are needs, you are ready to make a budget.  You have to list down first the ones that are fixed, which means those that you are spending on a regular monthly basis.  Examples of these are house rentals, monthly amortization, etc.

Once you’re done with the fixed expenses, the next list would be the variable expense.  These are expenses that are important but varies in amount like your fare to work, food, electricity, water, etc.

Adjust As You Go

Check your performance every month and see how you are improving.  As you do this, make adjustments on your spending plan until you master it.  Mastery is the key here.  The more you do this, the better you will be.

Stick to It

This last advice that I can give you is very important.  Even if you do all the things I mentioned above, if you don’t stick to your budget, nothing will happen.  This is commitment.  You really have to make a decision to follow your spending plan so you can have a better future.

If you want to know more details on how to make a budget, I teach this in our Personal Financial Management Class where I will be coaching you step-by-step.


You can enroll to one of our Personal Financial Management In-depth Sessions (venue is in Pasig City) or invite our team to your company for a Personal Financial Management Seminar and Workshop (1 Day session) by sending us an email at or call us at 0927-8931175.



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