Five Steps to Starting a Completely Bare Bones Budget


The term bare-bones budget sounds a little scary and intimidating – and not so much fun. But sometimes in life you have to do what you have to do to make life more enjoyable. Perhaps your goal in life is to make a down payment on a house or car as soon as possible. Perhaps you have serious debt and you need to pay that off as quickly as possible. Whatever it is, you need to find a budget that is going to work for you to allow you to save as much as possible by cutting as many expenses as possible. It’s exactly how it sounds, too. You will cut out every single expense from your life not completely and utterly related to your honest to God living expenses. It’s tough, but someone has to do it. You can do it by making sure you stick to the plan and by focusing on the big picture. And we have the first five – and most essential steps – to creating a bare bones budget from scratch.

Track that Spending

You have to go back months to see where your money is going. Perhaps you have plenty left over after your expenses each month, but you cannot figure out where it is going. You have to go back and figure this out before you get started.

Get Rid of All Non-Essentials

We need you to look at your expenses and figure out what you need and what you don’t. For example, you need your house. But you do not need cable. You need a phone for communication, but you do not need the most expensive phone and accessories around.

Cut Out Even More

Now you have to look even deeper. You’ve already cut all non-essential bills like cable and things of that nature. But what about that grocery budget? You might spend $250 per week at the store, but if that includes three bottles of wine and a case of beer, it’s time to cut it out (it’s not fun, but you’ll have more savings and you’ll look and feel amazing).

Make a List

Now it’s time to make a list of your expenses, when they’re due and when you are paid. You have to see where your money is going and when. And you’ll need to add your savings into that, too. You should have nothing left over after your expenses, your savings and your debt payments. That’s how you save the most and pay the most.

Start ASAP

Start now. Do not wait until the beginning of next month or whatever; do it now. You need to start saving as soon as possible to make sure that you’re able to do it as effectively as possible.

Photo Illustration by Scott Olson/Getty Images


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