Budgeting Basics and Other Tips for a Successful Start to the Year

January 14, 2022

We’re already a few weeks into 2022, but resolutions and planning for the year ahead are still top of mind for many. Allow us to provide a few more ideas to consider while we’re all still motivated and primed to form some new habits.


Budgeting Basics

Many folks tend to look at their cash flow as part of their beginning of the year checklist. Perhaps you’re factoring in a new raise, planning for an upcoming life event (retirement, anyone?), or jumpstarting your savings toward a big goal. In any case, we’re big proponents of having a budget, or at least tracking your spending to have a handle on where your money is going.

Following are some tips for setting a budget, sticking to it, and successfully saving for your goals.


Set realistic goals

This one’s just psychology. If you consistently aren’t meeting your spending and savings goals, you’re going to get discouraged, your self confidence will take a hit, and you’ll start avoiding your budget like the plague.

Set goals that you can actually accomplish!


Give your money a job

One of the best things you can do to avoid overspending is to give every dollar you earn a “job”. Even if that job is “fun money”, consider setting that amount aside in a separate savings account labeled as such. Many banks will allow you to create multiple savings accounts and name them, and I’ve found this has helped me to see how much money I actually have to spend in certain categories.



Let’s say you have a savings goal of $500/month. Instead of waiting until the end of the month and sweeping whatever cash you have left into savings (which, let’s face it, is probably not the full $500), set up an automatic monthly transfer into your savings account. Look at it as one of your “bills” you have to pay to your future self.

Or even take it a step further and if possible, have your employer deposit that $500 separately into your savings so it never even hits your checking account. Out of sight, out of mind.


It’s not “one and done”

Unfortunately, you can’t just set a budget at the beginning of the year and be done with it. Things will come up and you’ll have to adjust your spending and/or savings. It’s an iterative process, but the time you put in will be worth it.

You’ll have to curate your transactions into the categories you set up, and compare it to the goal you set for that category. If you find that you’re going over budget on a certain category every month, you’ll need to decide whether you can lower your spending in that category, or increase the budget amount and lower it somewhere else. This process can be very eye opening. Just the task of looking at where your money is going on a consistent basis can change your habits.


Use your resources!

There are so many resources out there for spending tracking and budgeting. Many banks offer tools within their mobile apps, which is convenient since they already capture all of your transaction data. If you bank across multiple institutions, there are websites such as mint.com and You Need A Budget that allow you to link your bank, credit card, and investment accounts to have everything in one place.

Clients of Gallant Financial Planning have access to eMoney’s robust spending and budgeting tools, and you can set up a call with me to learn more about these and get started with your own budget in there.

See also this checklist for things to consider when reviewing your cash flow.


Don’t forget about…

…taxes and estate planning and insurances, oh my!

Take a look at this checklist for other beginning of the year items to consider.

We’ll be reviewing draft tax returns we receive before April 8th. Once you have a draft, upload it to your eMoney Vault and we’ll get back to you with any recommendations before the filing deadline on Monday, April 18th.

During upcoming spring financial review meetings we’ll be reviewing home, auto, and umbrella insurance policies and making recommendations on those. Please upload your declarations pages to your eMoney Vault if you haven’t already.

And if you have any lingering questions from our estate planning discussion from the fall, let us know and we can add that to the agenda for your spring meeting.