Jan 31: Easy ways to start having a personal budget
January 31, 2025

We’ve read a ton of books on retirement/saving for retirement/living in retirement, and there’s one common thread that runs through all of them – the need to have a budget (and to stick to it).
Save with SPP decided to search for easy ways to get a budget in place, for those of us who either don’t currently budget or have given up due to fears it will be too complex and difficult.
At the Money Canada blog, writer Sandy Vong advises that if “you consistently look at your bank balance and wonder where the money goes then it’s time to take charge of your funds – and that starts with making a budget.”
“The good news is that it doesn’t have to be scary or time-consuming. But having a budget is critical. A budget gives you a big picture of your spending and saving habits and it’s a great way to take charge of your finances,” writes Vong.
Vong’s budget plan involves five steps – understanding and rating your values, setting your financial goals, tracking income and expenses, creating a budget and then regularly reviewing it.
The “value” idea is a bit unique.
“Values are those intangible measures of a good life. For instance, good health may be a value, as it a fulfilling career, or a place to call home. By starting with your values, you’re able to understand what value you are helping to support when you spend or save your money,” Vong explains.
The budgeting part itself, Vong notes, is fairly simple – track every expense and all of your income.
“Tracking your income and expenses is a simple exercise that takes a few minutes every day, but will quickly show you what your lifestyle is like and what areas you are spending the most on,” Vong notes.
“You can keep track of your income and expenses by using a note-taking app like Evernote.
However, there are more sophisticated budgeting apps such as YNAB (You Need A Budget). Whenever you go to purchase an item, whether online or in-store, record the date, the name of the store and the amount you spent. This way, you will have a full summary of where your money comes in and where it goes out at the end of the month,” Vong concludes.
There are other budgeting strategies.
Writing for GoBankingRates, Caitlin Moorhead explains the 75/15/10 budgeting approach.
“The 75/15/10 rule is a simple way to budget and allocate your paycheck. This is when you divert 75 per cent of your income to needs such as everyday expenses, 15 per cent to long-term investing and 10 per cent for short-term savings. It’s all about creating a balanced and practical plan for your money,” she writes.
She sees the 15 per cent as going for your future. “By putting 15 per cent of your income into investments like stocks or real estate, you’re not just saving — you’re growing your wealth,” she explains. The 10 per cent should be used to build up an emergency fund that can cover up to six months of expenses, she concludes.
Another, somewhat similar approach is the “50/30/20 method,” reports Linda Howard of The Daily Record.
In this approach, she explains, 50 per cent of your money is earmarked for “essential spending such as bills and food shopping,” with 30 per cent going to fun “non-essentials, such as eating out and style and beauty,” and the last 20 per cent going into savings.
The great Gail Vaz-Oxlade has long proposed a “cash jar/envelope” budgeting system, covered via the Smart Canucks blog.
According to the blog, Vaz-Oxlade’s approach “recommends that of your total income, 35 per cent goes to housing, 15 per cent to transportation, 25 per cent on `life’ (everything from groceries, pets, kids etc.), 15 per cent to debt and 10 per cent to savings.”
As we all remember from her many TV shows, she encouraged people to actually set aside cash for each category in jars or envelopes. If there’s no money left in the jar, you need to wait until the next month.
You can figure out your own budget approach, but the chief idea is to spend less than what you earn. To do that you need to see what you are making and know what your bills add up to.
If you are developing a budget, be sure to put some money away for long-term savings, such as retirement. If you don’t have a retirement program at your workplace, consider the Saskatchewan Pension Plan as your savings partner. Open to any Canadian with registered retirement savings plan room SPP is like an RRSP that has, when you retire, built in options to turn savings into income. You can, for example, convert your account balance into a monthly lifetime annuity payment. Or you can select the more flexible Variable Benefit.
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Written by Martin Biefer

Martin Biefer is Senior Pension Writer at Avery & Kerr Communications in Nepean, Ontario. A veteran reporter, editor and pension communicator, he’s now a freelancer. Interests include golf, line dancing and classic rock, and playing guitar. Got a story idea? Let Martin know via LinkedIn.
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