best budgeting tools

You may be at a point where you realize that you need to take your first step to solving your financial troubles. What better place to start than with a budget! You might start by searching Google for “Best Budgeting Tools”. You pick one, maybe a free one, that allows you to connect your accounts. You’re able to place every single transaction in a specific category. The budgeting tool you chose might also allow you to set spending limits for certain types of transactions. You receive a weekly update and alerts when you approach your spending target. Pretty cool stuff right?

Unfortunately, this won’t cut it.

Even the best budgeting tools aren’t enough to help you find financial success. What these tools actually are, are SPENDING TRACKERS. Just because you can set a BUDGET, doesn’t mean you’re BUDGETING.

If the goal is to reach long term financial success or financial independence, it takes more than just looking at what you’ve spent. It takes a combination of habits, practices and behaviors to look forward at what you want to spend and to make sure you stay on track.

A Perfect Example

A good place to learn what it takes to be successful, is a business. A large scale company provides an excellent example of what it takes to maintain and succeed with finances.

They have entire departments focused solely on where they spend their money, how they spend it and what the results are. There isn’t a penny that goes to waste. Every dollar and every employee is working hard to play their role in reaching a goal.

Within the company’s finance department, they set budgets and track expenses vs. income. The company has very specific goals and targets, short term AND long term. They meet regularly and remove emotion from their decisions to make cut backs.

How is this any different from you and me? We have goals. We should be aiming to hit targets and grow in our personal finances, just like any company. For some reason, most of us don’t think that way. We should be looking at ways to cut costs, increase revenue and improve efficiencies.

It’s rare that you’ll ever see a business succeed by only looking in the past. YOU are your own business. A family business. Everyone has a role to play. Now, let’s look at what else you can do, other than choosing a budgeting tool, that can make your family business successful.

Find Your Targets

I’ve said it a hundred times and I’ll say it a million more…without knowing what you’re working toward you will NOT find financial success. Before you can do anything, you should dig deep to determine your goals or targets.

We all have expenses that you need to cover. If you know that you need to buy a new car, write it down. You may know that you need to have a medical procedure done or replace an aging AC unit.

You may want to fund your kids tuition, build a she-shed or upgrade your kitchen. Bigger dreams like starting a business or taking a month off of work to travel should also be written down.

Revisit these goals every 6 months, if not more. Put it on the calendar so you don’t forget. If you’re married or sharing finances with anyone, work through it together so you’re working toward the same goals.

Once you’ve narrowed down your targets, keep them in front of you. You’ll want to see it almost daily just to stay motivated.

Create a Budget for Your Budgeting Tool

Before you can track your spending, you should decide where you want your money to go. Makes sense, right?

Know what your needs are, each and every month. These are unavoidable and must be paid. Then you can start backing into the rest of your budget.

Do this once a month after reviewing your expenses from your budgeting tool. Your budget is alive and will fluctuate. Don’t let it take on a life of it’s own. Checking it monthly will keep you in control.

If you need help, we’ve put together a 3-day email challenge that will show you what to do. Click here to get started.

Same Time Next Week?

best budgeting tools calendar

Every week you should be tracking your expenses. Never let it go beyond that. In your shiny new budgeting tool, keep track of your expenses. Even if it can auto-categorize them. The tools are smart, but bound to make mistakes. Plus, you won’t remember the details of your transactions for much longer than a week, if not less.

HoneyFi is a free app that works well for couples. You can both work on your budget TOGETHER.

Set an alert on your phone to remind you at the same time every week. Stick to it. Once you do this for a while, it will become a habit. You’ll need this information for your monthly budget review.

Annual Policy Reviews

If you’re not using an independent agent to help you with your home, auto and other property & casualty insurance, now’s the time to find one. They can help you find the best rates with the best companies, and at no expense to you.

When you are working with an agent, you’ll likely have a number of policies that expire or renew at different points throughout the year. Whenever that time comes, ask your agent to see if this is still the best policy for you. A lot can happen within a year that can change your rates or even the insurance company’s strength. You might be in the best policy, but you might not.

Find Accountability

I look at this like a personal trainer. Sometimes, we just need some help to get started or to stay on track. If you’re married, help each other.

Set a monthly meeting on your calendar. This reflects a business and it’s review meetings.

It’s a good time to review where you spent your money for the month. It’s also a good time to talk about what expenses are coming up, if you’re struggling with anything, if you have questions or concerns. Don’t let it turn into an argument. That’s a slippery slope.

You may need outside help. A financial coach might be the right move for you. This is someone that can help organize your finances, provide accountability, education and break things down into steps for you. Sure, there is a cost, but it’s money well spent if it gets you where you want to go.

What Your Budgeting Tool Can’t Do For You

When you’re reviewing your expenses, you need to watch for a few things.

You may have a duplicate charge that needs reversed. Old subscription payments might pop up out of nowhere that you thought you’d cancelled. Fraudulent transactions occur that need swift action.

Something else that I find that I forget about is when a promotion expires and a recurring bill gets higher. You can catch that and try to renegotiate or at least make sure the new price is built into your budget.

Take Your Allowance

If you’re having trouble keeping your spending down, use cash.

You can go to the ATM at the same time each week and get a set amount of cash out. This helps keep spending down, as I’ve mentioned in previous articles.

The behavior we’ve developed in using plastic has allowed us to buy without thinking ahead. When it’s cash in your pocket, you think about how long this needs to last and is this “thing” worth buying.

To put a bow on it…

Even the best budgeting tools struggle with what it really takes to be proactive about your money. At best, they can alert you when you’re getting close to spending too much. Without thinking ahead and being proactive, not only will you not reach your goals, you’ll never reach true financial independence. It takes a combination of habits, practices and behaviors to stay on top of it. Don’t get fooled in thinking a budgeting tool can solve your problems. That’s up to you.

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Brad Ruttenberg

Brad Ruttenberg

Co-Creator

Sports Fan, Movie Buff, and Anything Outdoors sums it up.  Brad loves spending time with his wife, Ashley, and their two boys.  He helps empower people to take control of their money, bringing them the confidence to build the life of their dreams.

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About Matt & Brad

They are identical twins and money experts.  Matt and Brad Ruttenberg have, combined, over 2 decades of experience as financial planners.  They are known for simplifying money and helping others go from living paycheck to paycheck to thriving financially.

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