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11 Budgeting Methods, Which Is Right For You?

Updated: Apr 20, 2023

How many times have you tried to budget but failed? Budgeting can be tough, especially if it's something you're not accustomed to.

To be successful, you have to get in the right mindset, set a goal, and choose the right budget that works for you.

Remember, you're in control.

Person counting their money and deciding how to spend it.
With so many budgets, it can be hard to decide what to do with your many. Let's make life a little bit easier! Which budget fits you best?

You want to budget for at least 3 months to see real results, so to get started and keep a routine, make sure you’re aware of what's out there.

That can be overwhelming since there're so many budgets to choose from. But no worries, you're in the right place.

I'll not only break down each of the 11 methods of budgeting, but I'll also help you figure out which is right for your life.

The "Spending First" Budget / "Pay yourself first"Budget/ "Reverse" Budget/The "Anti Budget" Budget

If you've heard of any of the above-named budgets, there's no need to be confused; they're all the same budget method.

See, things are getting easier already!

With this budget, you prioritize your savings, which will be your first bill, then you pay the rest of your bills.

Once you have taken care of those things, the rest you spend as you, please. If you have control and are more disciplined, this is a good budget for you.

You don’t have to track every penny you’re spending. You put the money toward your financial goals first and foremost.

Example of the pay yourself first budget
A quick example of the Pay Yourself First budget, one of its many names.

The "No Budget" Budget

The “no” budget" budget is a real thing. It's actually a pretty cool concept.

You set up several bank accounts; each used for a different expense.

For example, you'll have a bank account for bills like mortgage, electricity, water, taxes, etc.

Then you'll have another account that you set up for your wants. You can separate your direct deposit into each account or deposit the money yourself.

Make sure you setup direct deposit into your savings account as well. Once you're out of money in that particular account, you're done.

It also works if you don’t want to constantly write down what you need to spend your money on.

Once you set up your accounts and deposits, you're ready to roll, budgeting every month automatically.

The "Envelope Budget"

With the envelope budget, you're separating your funds for each expense, except you're doing it with cash in envelopes.

This budget is a little outdated for some because most people try not to carry cash. But for people who still do, like my husband, this is a good budget to have.

Once you've depleted all the cash from a particular envelope, you're done with that expense. This is great for expenses you tend to go overboard with.

The "Value-Based Budget"

This value-based budget is based on your values or goals in life. This is a more personalized budget method.

Each person has different goals and values in life, so this budget will look different for each person.

Suppose you're the type that doesn’t spend money on things you don’t need. You’re good.

You have your values about money intact. You're going to do the right thing and don’t need rules.

You don’t see a budget as a chore but as a necessary stepping stone to getting what you want.

But honestly, if you're new to budgeting, this may not be the right budget for you.

I started budgeting because I needed rules and structure.

The "50/30/20 Budget"

This budget is more of a guideline to use to help you think about budgeting. But some have used it as a budget, and it works.

You first have to take a good, hard look at what you consider needs and wants. Then allocate the funds accordingly because you may have to make adjustments.

But remember, some people use this as a budget, but others use it as a principle for budgeting.

So if you need the structure for now and have to use it as a budget, go right ahead.

Example of the 50/30/20 Budget
Example of the 50/30/20 budget, this is a guideline and can be adjusted if needed, as shown in the example.

The "Zero-Based Budget"

With the “Zero Based Budget,” you're going to add up your income, add up all your expenses and subtract your expenses from your income down to $0.

This works because your savings is also considered an expense. Your total, in the end, will be $0 because you have given every dime an assignment.

It challenges you to look through your expenses and slash things that aren't serving a purpose in your life.

You still get that $0 balance at the end, but you can allocate certain dollar amounts to other expenses if you find you need more money for more important things.

This is an example of the Zero Based Budget.
In the Zero Based Budget, every dollar serves a purpose.

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The "Spending Ceiling Budget"

The "spending ceiling budget" is when you set a cap on how much you'll spend on your expenses, and after that, you shout it down.

If you go over this amount, you make the adjustment for the next month by raising your spending ceiling, and if you go under, you treat yourself to something nice.

For example, if you make $3500 a month and your spending ceiling is $2000 a month on expenses. You can take the rest of your income and do with it what you please (try putting it in savings or investing).

The "Survival Budget"

The “Survival Budget” can be implemented throughout all the budgeting methods. This is when you cut all non-essential items from your spending.

This budgeting method is meant to be temporary.

For example, if you are trying to quickly build an emergency fund or you're trying to save for a house.

But if you like it, you can keep it forever. It’s up to you!

Top 3 Budgets

The 3 most popular budgets are:

  • The Spending First Budget / Pay yourself first/ Reverse Budget/The Anti Budget

  • The 50/30/20 Budget

  • Zero Based Budget

Easiest Budget

In my opinion, the easiest budget that I have used out of all the ones I’ve tried is the Zero Based budget.

I find it to be simple for my budgeting needs. I do this on paper, and I do it about every 3 months, which is quarterly. I also use the "no budget" budget between the 3 months.

When I first began budgeting, I did it every month, just something to think about.

How to choose the right budget?

Before you choose a budget, ask yourself these questions. This will help you decide which budget is right for you.

  • What are my goals?

  • Am I a disciplined person?

  • Do I like structure or freedom?

  • How much of my lifestyle am I willing to change?

Major Take Away

Lady happy and smiling because she completed her budget.
People who have a budget tend to think less about money than people that don't budget. They also tend to be less stressed about money.

Not having a budget at all is costing you money.

Your budget is based on how you think, so your budget will look different from someone else's.

You can switch budgets or even mix budgeting methods. Why not? It’s your life!

Now you may think, “Budgeting will make me think about money all the time; I don’t want to live like that.”

But actually, you'll find it has the opposite effect. You'll be in control, and once you put your budget into action, you'll know exactly where your money is going.

Leaving more time for you to enjoy other things.

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