Setting smart budgeting categories helps you control overspending

Build a personal budget that helps you control overspending that leads to credit card debt.

Personal budgeting tends to get a bad rap. In the past, it was a time-consuming hassle that most people would prefer to avoid. However, today’s technology, such as smartphone budgeting apps, make it easy to budget so it can become part of your daily routine. The more you stick to a budget, the easier it is to save money and manage debt.  It also helps you avoid issues that lead to financial hardship.

The articles in this section are geared towards helping you learn how to build and maintain an effective personal budget. You can find more tips at the bottom of this page.

We Overspend at the Holidays and Don't Stop

We Overspend at the Holidays and Don’t Stop

November 29, 2017 | Dori Zinn

Half of Americans create a holiday budget but most of us have busted our budgets before.

Human Skull Rest On Top of Gold Coins

You Can’t Cheat Death, But You Can Save on It

October 23, 2017 | Adina Solomon

A funeral expert tells you how to plan your own demise on a tight budget.

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Where Your Money Is Worth the Most

September 26, 2017 | Dori Zinn

This map will show you where you can make the most of your disposable income.

Too many credit cards can be bad for your credit, even if they are as colorful as these

Are Millennials Opening Too Many Credit Cards?

September 25, 2017 | Ryan Lynch

The generation is looking for cards that offer more rewards

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Why 3 Obscure Polls Are Good News About America’s Debt

September 25, 2017 | Howard Dvorkin, CPA

No one is talking about them, but they should. So I will.

Man and woman sit on the couch looking at a bill and dealing with money fears

Men And Women Have Different Money Fears

September 21, 2017 | Joe Pye

Guess who’s afraid of never being able to retire? And who fears living paycheck to paycheck?

A baby boomer man stands at a sunny window contemplating his retirement plans

Baby Boomers Fear 2007 Financial Crisis Ruined Their Retirement Plans

September 19, 2017 | Ryan Lynch

Over three-fourths of the generation feel they will have no savings for their post-work life

Khaleef Kicked the Eating Out Habit

September 6, 2017 | Brian Bienkowski

He and his wife eat healthier now and save more money.

Portrait of Zina from Debt Free After Three,’s Financial Profiling featured personal finance blogger

Zina Paid Off $28,000 of Debt in Three Years

August 2, 2017 | Brian Bienkowski

She put every extra penny toward her student loans and carefully tracked her spending.

Save the children and moms

Bring Your Budget Back to School

July 27, 2017 | Dori Zinn

More than half of parents shop with a back-to-school budget and expect a rise in expenses this year. But parents are working the extra expenses into their budget. Back to School 2017 illustration with icons for clothing, electronics, shoes, and school supplies

Your Back to School Budget Might be Breaking Your Bank

July 26, 2017 | Brandon Ballenger

After the holiday season, back-to-school shopping is the second largest spending event of the year. Nearly half of Americans will shop online, according to the National Retail Federation. In total, they’ll spend an estimated $83.6 billion — a more than 10 percent jump over last year, and a five-year high — to get grade school […]

The cost of a pile of school supplies is nothing compared to the shocking state of school teacher pay

Back-to-School Shopping: $73 Billion

July 25, 2017 | Dori Zinn

Kindergarten through college will cost consumers nearly $73 billion this back-to-school season, with college being roughly two-thirds of that.

Couple on a sailboat are well off but also may not connect American wealth with having a lot of money

Americans Define Wealth in Very Different Ways

July 18, 2017 | Gregory Cox

Think it means being rich? Think again.

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QUIZ: Do You Know American Spending Habits?

June 5, 2017 | Emily Bloch

It’s like a really sad version of ‘The Price is Right,’ because the only prize is knowing how people budget

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How to Prepare for and Deal With an Income Emergency

May 19, 2017 | Money Talks News

How quickly could you come up with $400? Many of us would need to borrow it.

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Good And Bad News About Recession 2018

May 15, 2017 | Howard Dvorkin, CPA

The economic recovery is literally one step forward, one step back.

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Should You Hire a Service to Negotiate Your Cable and Other Bills?

May 12, 2017 | Money Talks News

We tried out one of these services. Results? Meh.

Donald Trump juggles piggy banks representing Social Security (illustrated)

Can Trump Keep His Promise To Leave Social Security Alone?

March 23, 2017 | Brandon Ballenger

He campaigned on not cutting entitlements, but conservatives think he has to.

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8 Foolproof Steps to Get You Out of Debt Fast

February 10, 2017 | Money Talks News

Want to speed up your debt-reduction efforts? Here’s how to do so without a crash diet.

The Secret To A Successful Marriage: Separate But Equal Cash -

Having Bad Credit Makes Saving for Emergencies Nearly Impossible

February 6, 2017 | Dori Zinn

Most Americans can’t afford an unexpected expense and low credit scores have a lot to do with it.

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Millennials Will Start Budgeting This Year

January 27, 2017 | Joe Pye

More than any other generation, they want to track their spending better in 2017

Today's debt report

Budget Your Way to Your Financial Goals This Year

January 27, 2017 | Money Talks News

It may sound like as much fun as having your teeth drilled, but budgeting really isn’t that bad.

Desirae Odjick of Half Banked and her dog Jacob

Half-Banked’s Desirae Odjick Budgets For Dog Toys

January 25, 2017 | Brian Bienkowski

Here’s how she obsessively tracks every penny — by hand.

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The Most Important New Year’s Resolution To Keep [video]

January 23, 2017 | Howard Dvorkin, CPA

You need to create a budget — although believe it or not, that’s a controversial statement.

High interest savings accounts

None of Us Are Ready for an Emergency

January 12, 2017 | Dori Zinn

What if you don’t have enough cash even for a tragedy, disaster, or other emergency? Most of us aren’t ready for one.

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My Simple Trick For Always Staying On Budget

December 29, 2016 |

No-stress, no-sacrifice saving? It’s not too good to be true. It’s too true to miss out on.

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How Your Thought Process Affects Your Finances

November 29, 2016 |

Knowing how you think about money can help you save more of it.

If laying out an budget that manages debt has you confused and stressed about money, you may need Financial Literacy 101

Is Tying The Knot Easier Than Uniting Finances?

November 24, 2016 |

For those who answer yes, there’s good advice and even outside help.

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Americans Aren’t Spending Less Because They’re Making Less

October 18, 2016 | Dori Zinn

They’re spending less to save more

Develop strategies to save money effectively

Spending Doesn’t Make Us as Happy as We Think

September 12, 2016 | Dori Zinn

But saving does, and most of us prefer it that way.

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4 Simple Steps To Get The Very Best Car Loan​

August 30, 2016 | Money Talks News

Many people shop backwards for a vehicle — and that’s costly. Here’s how to get the best deal.

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Want to Save Money? Live on a Cruise Ship

August 1, 2016 | Treanna Lawrence

Why it’s cheaper to take a year-long vacation than it is to live in California

The United States flag and electoral map are made of money (illustrated)

Want Cheap Homes and Great Pay? Move to Texas

July 21, 2016 | Dori Zinn

If there’s one thing that’s not bigger in Texas, it’s the cost of living. But that doesn’t stop Texans from overspending. They have some of the worst money managers in the country.

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Can You Afford To Grow Old?

June 28, 2016 | Dori Zinn

Most Americans predict they’ll run out of money before they die

a budgeting reminder to do your budget for the month

Reach Your Goals Without A Budget

June 28, 2016 | Money Talks News

Budgets are about deprivation and discipline. No wonder they’re hard to stick to.

America Saves Week

Dvorkin On Debt: Taking A Bite Out Of Debt

June 27, 2016 | Howard Dvorkin, CPA

The seventh scholarship winner has a superior brain but a suffering mouth.

If laying out an budget that manages debt has you confused and stressed about money, you may need Financial Literacy 101

Ask The Expert: Which Bill Do I Pay First?

June 22, 2016 | Howard Dvorkin, CPA

A reader has only enough to pay the mortgage, car lease, or credit card. But not all three.

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FOMO Plays a Huge Role in Millennial Spending

June 21, 2016 | Treanna Lawrence

How the fear of missing out effects this generation

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Student Debt is Promoting a Stagnant Housing Market

June 20, 2016 | Treanna Lawrence

Why many are struggling to buy and sell homes

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The Financial Costs of Living Longer

June 6, 2016 | Treanna Lawrence

Why most Americans don’t feel secure for retirement

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Dvorkin On Debt: A Prince-ly Sum

May 30, 2016 | Howard Dvorkin, CPA

3 financial lessons we can learn from the artist known as Prince

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10 Easy Steps to Simplify Your Finances and Improve Your Life

May 17, 2016 | Money Talks News

How to declutter your financial life, your home and your social life and breathe easier.


How to Prepare For and Deal With an Income Emergency

May 3, 2016 | Money Talks News

A lot of people in all income brackets are ill prepared to deal with financial shocks.

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Can You Afford to Quit Your Job?

January 28, 2016 |

It depends on your answers to these 3 questions.

a budgeting reminder to do your budget for the month

Ask The Expert: Who Needs A Stinkin’ Budget?

December 30, 2015 | Howard Dvorkin, CPA

A reader says her son is taking the wrong advice from the Internet.

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8 Ways to Get Your Holidays Off to a Budget-Savvy Head Start

November 5, 2015 |

If you start now, you can save hundreds.

How much money do you need to be happy?

3 Ways Your Weekend Is Busting Your Budget

September 22, 2015 |

Why save five days a week only to blow it all in two? Here’s how to save all week long.

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Why Lifestyle Inflation Is Killing Your Budget

September 3, 2015 |

This is the worst kind of inflation. Here’s how to lower it.

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15 Places to Find A Part-Time Accountant for Your Startup

August 11, 2015 | John Rampton

Sure, there’s accounting software. But sometimes, you need a human being to help you.

a budgeting reminder to do your budget for the month

5 Reasons Your Budget Isn’t Working

July 28, 2015 |

Here’s how you can make it work for you, instead of struggle against it.

8 Tips for Effective Budgeting

#1: Find a platform that fits your lifestyle

The biggest roadblock in budgeting is finding a tool that makes it easy to budget. Pen and paper or spreadsheet budgeting are rarely effective because they don’t integrate easily into your daily life. But a smartphone app is easy to check every day.

So, the best budgeting tip we can offer is to find a platform that fits seamlessly with your lifestyle.

  • First check with your bank or credit union – you may have a budgeting tool already integrated with your checking account.
  • Look in your app store to find free budgeting apps
  • If you’re concerned about security, you can opt for desktop software, although this option is rarely free

#2: Recognize that budgets are not set in stone

One of the biggest mistakes that people make when they budget is that they set up a budget, then leave it be. Budgets are not set in stone! They are constantly changing, based on your income, needs and wants. Recognizing this means that you give yourself more flexibility. You set targets that you aim for, instead of defining concrete numbers that you can’t deviate from.

Always remember, a budget is really just a recommended spending guide. It helps you stay on track. But if you color outside your budget lines every once in a while, that’s okay!

#3: Set targets to control your spending

Whether you use an app with built-in categories or you make a budget from scratch, always make sure to set spending targets. These help you keep flexible and discretionary expenses under control so you can avoid overspending.

Flexible expenses are necessary expenses that don’t have a set cost (as opposed to fixed expenses, that have set costs). Discretionary expenses are all your wants, whether they have fixed or variable costs.

In both cases, you should set spending limits for each category of expense that you have. For instance, you set a food budget of $100 per week or $400 per month.

#4: Use alerts to your advantage

Most budgeting tools that are popular today offer alerts. They track spending and alert you whenever you approach a spending target. This helps you keep your spending under control. The alerts are usually sent via email, text message or through on-screen notifications if you use an app.

Using these alerts helps you stay on target without depending on you to check the app every day. Instead, your budgeting tool will tell you when it’s time to check in and adjust your spending.

#5: Pad your budget with free cash flow

Your budget should always balance your expenses versus your income. But that doesn’t mean that every dollar should be accounted for as an expense. If you spend exactly what you earn, you haven’t built an effective budget. Instead, you’ve built a strategy that ensures you’re always going to live paycheck to paycheck.

Instead of budgeting down to your last dollar, you need to leave yourself some breathing room. Ideally, you should only spend about 75% of what you bring in each month. That extra 25% is called “free cash flow.” This is basically money that you use to cover those unexpected expenses that inevitably come up each month.

#6: Savings is not free cash flow

Another big mistake that people make when budgeting is treating free cash flow as savings. You basically decide to save whatever you have leftover at the end of each month. This is a sure way to ensure you never save anything.

Instead, savings should be treated like a fixed expense. You decide how much you can afford to save each month – ideally, between five and ten percent of your income. Then you set this as a fixed expense in your budget. It’s like a bill that you pay yourself every month.

This keeps saving separate from free cash flow. You have money to cover all those unexpected expenses, but you also save consistently.

#7: Adjust your budget at least every six months

As we pointed out above, your budget should not be set in stone. Anytime you have a change in income or a new recurring expense, you need to revisit your budget.

But in addition, you also should make seasonal budget adjustments.  Expenses from summer to winter vary widely. For instance, your electric bill could vary by up to $100 or more, depending on where you live. You can’t just decide to use less energy and leave your family freezing in the winter, so you need to adjust the target.

This also allows you to build in money for seasonal costs, such as a back to school budget in the summer and holiday budget in the winter. The more accurately you track these seasonal cost, the easier it will be to control your spending.

#8: Make sure to keep needs and wants separate

With budgeting apps, this usually involves customizing your categories. Most budgeting tools categorize transactions automatically. But the categories may blend needs and wants that are better kept separate.

For example, most applications auto-categorize food purchases. So, all your grocery store and restaurant purchases are lumped in together. But that isn’t a fully effective way of budgeting because it blends a need and want together.

Groceries are a need because you need food to survive. By contrast, eating out is a luxury – it costs more and should be curtailed when you’re worried about overspending. With that in mind, you should customize your app to split food into two categories: groceries and dining out.

This allows you to have one food budget that necessary (and fairly constant) and another for treating yourself and family. This also makes it easier to cut back when things get tight.