Budgeting Basics – EP 208

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Using a budget helps us make more informed financial decisions. And that’s what we’re all here for. In this episode, Jen and Jill talk about some important points to help you create a budget so you can identify what goes into your expenses and make sure that you can live within what fits your lifestyle.

You can be anyone you want to be and still have a budgeting practice.


  • Oil and vinegar. 2 things that seem to not go together have paired up to sponsor this episode! Like sweet and salty, chili and macaroni, fear and joy – they’re all here to announce the Frugal Friends 4-year Anniversary Party! It’s gonna be the best fancy/frugal fiesta. Will all the money savings party hacks paired with all the luxury one can expect from us (think hot dogs and charcuterie… :)) If you’re a Frugal Friends listener you can celebrate our accomplishment with us on April 23rd in St. Petersburg, FL at our 4 Year Anniversary Party. If you’d like to join head to frugalfriendspodcast.com/party for more info!

Four Basic Budgeting Methods

Everyone’s needs are different and that is why there is no “one size fits all” formula when it comes to budgeting. To help you, NWCU listed down four basic budgeting methods that may work for you.

What Jen + Jill have to say:

Jen talks about the methods of cash-only budget and pay-yourself-first budget

Jill discusses the importance of having a basic idea of how much you’re earning and how much you’re spending. She also talks about the classic budgeting where you work on a spreadsheet with 2 columns ‘estimated spending’ and ‘actual spending’ for various categories (utilities, food, entertainment, etc.). Another method Jill talks about is the percentage budget which is less strict and is also called ‘proportional budgeting.’ This is where you set aside a certain percentage for spending vs. saving (you set aside a certain percentage for needs, a certain percentage for wants, and a certain percentage for savings).

How To Make a Personal Budget in 6 Easy Steps

If you’re looking for a template you can use to fill in the numbers for your expenses and income, this article from the balance shows a step-by-step guide to creating and using a budget.

What Jen + Jill have to say:

Jen discusses three steps: gather financial paperwork, create a list of monthly expenses, and total your monthly income and expenses.

Jill agrees that “a budget does not have to be restrictive to be effective.” She further argues that the amount of money we make each month is what restricts us…not the budget. Jen then talks about another three steps: calculate your income, determine fixed and variable expenses, and make adjustments to expenses where they added to make adjustments to income wherever possible too 😉 THEN comes maintenance where you should monitor and continue to track.

Budgeting method we started with and what we're using now

Jen used a zero-based budget method and now she ‘wings it’ 🙂 – she no longer have fast financial goals.

Meanwhile, Jill started from the bottom… and she’s still here 🙂 she used the cash envelope technique, but now doesn’t need that technique to keep her on track.

Thanks so Much for Listening!

Thanks so much for listening! Instead of reading one of your kind reviews about us, we wanted to celebrate one of our Financial Freedom Mentorship member wins! This one is from Christy who paid off her credit card debt! She says:

I joined this group to hold myself accountable and to learn! I absolutely love the podcasts! When I joined 2 months ago, I stopped using my credit cards. I quit smoking. Stopped the Starbucks runs… etc. ( I have smoked on and off for YEARS ugh. ) I joined with having 9000,00 in credit card debt. The only other debt we have is our house! ( but I don’t consider that a debt because when we sell, we should make a lot of profit due to negotiating on a bank owned home) My hard working hubby came home and said that he got a bonus. I had no idea! I have paid OFF the credit card. I am watching my spending behaviors because I do tend to over spend to fill that void - bored-Lonely-Depressed. Etc. I enjoy reading other comments and info ! We can do HARD things!!

Congrats, Christy! If you want to check out the Financial Freedom Mentorship head to frugalfriendspodcast.com/ffm to see what’s going on in there!

Keep leaving us reviews on iTunes or Stitcher, and sending the screenshot to reviews@frugalfriendspodcast.com AND share our most recent episode on social for a chance to win $50 to spend in the Frugal Friends Shop! And don’t forget to share your favorite quote from the episode by using the hashtag #FrugalFriendsNote. 😉

And thank you Lindsay from Pittsburgh for sharing your bill about paying off $45k of loans in 2.5 years (student loans and car payment); NOW cash-flowing vacations and putting more money towards 401K. Congrats on your forever results!!

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