Education Center

Budgeting for Beginners

Sean Bunevich

We’ve all heard of budgets—what they are, how to stick to them, and which tools help make the process easier. Do you really need to budget, though? The short answer is yes. Budgeting allows you to carefully save for a down payment on a house.

Here are some budget category examples:

  • Rent or mortgage payment
  • Utilities
  • Credit card payments
  • Cash transactions
  • Groceries
  • Restaurants
  • Insurance
  • Savings
  • Investments
  • Giving/donations
  • Clothing
  • Entertainment
  • Auto expenses
  • Holiday spending
  • Miscellaneous

There are many tips and tricks that will help you become smarter with your money; today we’ll go over the two basic steps of budgeting.

Step 1: Define Your Budget

The first thing to do is set inspiring financial goals to work toward. Often, this is split into either short-term or long-term goals.

Short-term goals might include:

  • Getting rid of your student loan debt
  • Holiday spending
  • Funding a vacation you’ve been dreaming about

Long-term goals might include:

  • Retiring by age 62
  • Paying off your credit card debt or mortgage
  • Saving for a down payment on a house, car, retirement, kids’ college funds, traveling

Certain categories might not need attention until specific points during the year, but it doesn’t hurt to start saving in smaller increments to prepare for it. For example, you can contribute to the holiday spending category throughout the year by putting away $50 every other month. Now you’ll already have spending money saved up when the holidays come around.

Step 2: Implement Budgeting Tips & Tricks

As mentioned, there are many ways to budget. Depending on your goal, certain tips and tricks will work better than others. Our favorites include:

  • Include all cash transactions as a part of your monthly expenses. Stay on budget by allocating a certain amount of physical money to an envelope for food, subscriptions, shopping, etc. Once that money runs out, you can no longer spend in that category. This will reduce overspending.
  • Use the lowest guaranteed income and set realistic targets for your expenses. Take the average of your last 3 months of income to get an estimate of what your targets should be. This prevents overbudgeting or underbudgeting.
  • Pay down credit card debt and balances. After paying off your credit card, you can redistribute your money to your budgeting plan.
  • Check your budget daily. This ensures you stay on track and allows you to make corrective changes if you went outside your limits.
  • Make seasonal or lifestyle changes. Budgeting goals may fluctuate. To accommodate, adjust your efforts according to the season (such as putting money not spent toward heating or cooling when you’re leaving your windows open while away) or lifestyle changes (like buying a house).
  • Create a reward system. After following your budget, treat yourself to a celebratory dinner or movie. This will keep you motivated throughout your budgeting journey.
  • Pick a budgeting format. Your budget can be handwritten, entered into an Excel sheet, or filled out in an app made specifically for budgeting.
  • Hold yourself accountable. Set up automatic payments online to pay off current debts or, if there are none, add to a savings account.
  • Review your budget and how it aligns with your goals. When your budget is complete, review your expenses and see if they line up with your short-term and long-term financial goals. This will help you navigate your next budgeting journey.

Budgeting may be daunting at first, but our helpful experts at Union Savings Bank are here to help you become a confident, successful budgeter. Use our top tips and tricks or contact our friendly team to get started on your budgeting journey.


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Written by Sean Bunevich

Sean Bunevich is Vice President of Consumer Direct Lending at Union Savings Bank and Guardian Savings Bank. When he’s not working, Sean likes to spend time with his wife and three adorable children.

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These articles are for educational purposes only and provide general mortgage information. Products, services, processes and lending criteria described in these articles may differe from those available through Union Savings Bank. For more information on available products and services, and to discuss your options, please contact a Union Savings Bank loan officer.