The Best Way to Stay on Budget: 5 Minute Weekly Spending Review
If you have ever wanted to get better at something, you know you need to keep an eye on it.
If you want to get more fit, you probably need to focus on what you eat and your exercise regimen. Maybe track your calories and get
But unlike keeping up with a healthy living routine, saving money and sticking to a monthly budget can be easier and take a fraction of the time.
You don’t even have to keep an eye on all of your expenses each day.
It’s all about taking the time to focus on what matters most. The metrics that will help you keep your budget on track.
If you could only do one thing to make sure you stick to your budget, it’s taking 5 minutes to review your spending each week.
This 5 minutes a week will help your budgeting stay on track.
We’ll go into the details in a little bit.
Table of Contents
Why is it important to stay on budget?
The one thing that will get you to financial independence is having extra money left over at the end of the month.
I mean, what good is it to have an amazing financial plan and motivating financial goals if you don’t have the money left over at the end of the month to fund them?
You can’t build wealth if there’s no money flowing to your balance sheet.
If you want to build an emergency fund, save for a down payment on a house, pay off credit card debt, save for retirement, or reach your long term financial goals, it all comes from how much money you have left over after your monthly expenses.
Setting a budget will help you get the parameters in alignment with that goal.
Budgeting doesn’t have to take a ton of time.
If you’ve ever started budgeting the traditional way, you know it makes it hard to stay on budget.
You have to keep an eye on your money closely, monitor all expenses, and track your spending, make sure you have your budget categories accurately maintained.
Yes, staying on budget is really important so you can have more money left over, but it doesn’t have to be complicated or take a lot of your time.
In fact, the simpler budgeting is, the more likely you are to stick with it.
Is it better to have the perfect budgeting system that you can’t maintain, or a simpler one that you know you can commit to?
Option 2 for sure.
The 5 Minute Weekly Spending Review
You don’t have to start budgeting with a complicated method to make sure you stick to your spending plan.
The weekly spending review will give you 4 opportunities to adjust so you will stay on track and focus on sticking to your budget.
Keeping track of your spending is the most important thing you can do in personal finance. But you don’t need to know exactly how much money is going into each individual budget category.
If you focus on the metrics that really matter, you can get all of the benefits of budgeting, and all it takes is 5 minutes a week.
Here are the benefits of tracking where you spend money once a week:
- You will see if you are running under budget or over budget and be able to adjust to hit your monthly target.
- You become more aware of your spending habits in the moment.
- It keeps your budget front of mind
- You will notice any automatic payments, annual or monthly subscriptions that you’re no longer using and cancel them immediately to save money.
- If there is any fraudulent spending, you’ll see it before it’s too late.
- It’s really easy to work together with your significant other.
The best thing to do is to have everything all in one place, and there are plenty of budgeting apps that will do that for you.
Link any account where income flows in and expenses flow out into your favorite one.
This is much easier than logging in to each bank account and credit card.
Again, we’re only looking for the accounts where you’re spending money.
Step 1: Review your expenses by transaction
Every budgeting app has a place where you can see the money going in and going out. Start by looking through your transactions for the last week.
Here’s what you’re looking for:
- Does anything stand out to you?
- Are there any expenses you don’t recognize?
- Are there any actions you can take like downgrading, canceling subscriptions, or asking for a refund?
- Do any expenses need to be recategorized?
Another bonus is to count how often you spend. The more transactions mean that your monthly budget could go over due to death by 1,000 cuts instead of one big expense capsizing you.
Really, you’re just trying to observe your spending habits so you can figure out what your strengths and weaknesses are.
Step 2: Review key budget categories
If you want your monthly budget to stay on track, you don’t have to stay on top of every single category.
You only need to focus on the areas that you are trying to improve.
In other words, what good does seeing that your mortgage payment was on budget? It should be that way every month. You’re just cluttering up your brain with information that isn’t helpful.
On the other hand, if you’re trying to rein in your how much you spend on food, create a food budget and set it 10%-20% lower than what you have been spending.
During this weekly review, check and see how you did for the week and adjust to stay on target.
For example, week 1 should be 25% of your monthly budget, week 2 should get you to 50% for the month at that point, and so on.
If you’re above that number, you now know you should make some different spending decisions in the coming weeks to end up on on target.
But, if you’re under budget, great! Feel free to use it up the next week if you want.
Set at least 1 but no more than 3 categories you’d like to keep an eye on and improve.
Step 3: Review your overall spending month-to-date
The best predictor of reaching your financial goals is how much money you have left over at the end of the month. It’s the most important thing in personal finance.
Because you’re looking at this, you don’t need to get super granular with your budget.
Just take a look how much you’ve spent month-to-date, and how that compares to your income.
Keep in mind that there’s more to it than just adding up your monthly budget and dividing by 4.
The first week of the month usually has your housing payment so it will be higher than most other weeks.
You could look at creating a weekly budget and include some of the timing of your big expenses so you can see what your weekly target should be.
It could be that half of your monthly budget is spent in week 1 depending on how the major living expenses are spread out throughout the month.
If you end up spending less than you made, you’ll be saving money.
If your expenses exceed your income, you’ll either need to take from your savings or go into debt to cover the expenses above and beyond your budget.
How to stick to a budget as a couple
Most households have certain divisions of labor.
As it relates to your money, there’s usually one spouse that handles it.
But if you want to reach your long term goals, it will take both of you to be aware of your budget and stick to it.
That’s where this process comes in.
One of you can manage the family finances if you want, but you will need to do this budgeting review together.
All it takes is 5 minutes, but there are incredible benefits doing it with your spouse including:
- Awareness of your household bills
- Talking through how big purchases fit into your budget.
- Getting on the same page with money.
- Getting clarity on what the Venmo and cash transactions are.
- Making progress together toward your shared goals
Many couples I work with have trouble enjoying the money they spend including taking trips together at the beginning. Usually it’s because one spouse is in the dark of the overall financial picture or is too much in the weeds with it.
The purpose of me designing the review process this way is so that both of you will be on the same page with your money and improve your communication and awareness around it.
If you’re the one of you who likes to dive into the numbers, you can still do that.
If you want to stay out of it altogether that’s totally fine.
But in order to do this as a team, the two of you should be aware of your expenses and see eye to eye on budgeting and understand the expenses you have enough money for, what fits in your budget and what doesn’t.
Just commit to this process 5 minutes weekly.
This is the simplest way to get all the benefits in as little time as possible.
Reach your financial goals and save money with the Weekly Spending Review
If you could only do one thing in personal finance that would determine your financial success, it would be keeping an eye on what you spend.
Yes, a budget helps determine your parameters, but if it’s hard to stick to, it could have the opposite effect and cause you to stop watching what you spend altogether, leading to more debt and less cash in savings or your emergency fund.
Budgeting doesn’t have to be super complicated.
The main factor is making sure your income is more than your expenses. If that’s all you tracked, it could be one of the best financial decisions you make.
If you need help with budgeting or getting on the same page, I’m here to help!
Set up a complimentary consult with me so we can talk through your finances together and find more money left over at the end of the month.
If you want to free up extra money each month but don’t want to talk through it together,
