Living in Canada, we’re among the luckiest folks in the world. Our standard of living provides most of us the necessities and even many of the luxuries of life. But we’re not immune from the pressures of inflation – filling up your gas tank these days is a big reminder that life costs more. With the price of  everything from groceries to travel going up, and the lingering cloud of uncertainty from the ongoing pandemic, it’s not a bad idea to double down on some money budgeting strategies. 

5 Budgeting Strategies for Beginners

1.    Envelope Budgeting

Robert Farrington, a personal finance expert, suggests people divide up their expenses into categories like groceries, clothing and dining out and then put an allowance into an envelope for each. It’s called envelope budgeting.

How it works: “From there, you spend down the balances on purchases that fall into each category, saving receipts along the way. Once the money is gone, it's gone,” Farrington says. “Of course, you can't pay your mortgage or your car payment with cash in an envelope. This strategy only requires you to use cash and envelopes in discretionary categories where you may spend more or less in any given month. In the meantime, you would pay the rest of your bills however you normally would.”

Whether you actually put cash into paper envelopes or virtually allocate amounts for your discretionary spending categories, this type of budgeting is a great way to track spending habits and discourage overspending. 

2.    Zero-based Budgeting

Zero-based budgeting is all about getting down to business and, Farrington says, it’s a good strategy for those with “serious financial goals on the horizon.”

How it works: Determine how much the household will earn in a month. Put that figure in one column and add up required expenses and bills in another category. Allocate the difference to savings, paying off loans or credit cards and investing until you have reduced your short-term debt to zero.
With zero-based budgeting, users need to monitor spending throughout the month to make sure they're staying on track within variable categories like groceries and gas. It’s also a good idea to  start building up a separate savings account for any surprise expenses. Gotta love those.

3.    50/30/20 Budgeting

This one involves math. With the 50/30/20 budget you get some more “wiggle room” while still being committed to investing more and whittling down your debt. 

How it works: 
●    50 per cent of your income goes to basic necessities like the mortgage/rent, utilities, insurance and childcare 
●    30 per cent can be spend on life’s luxuries like trips, entertainment and meals out
●    20 per cent goes to savings and paying off your debts

4.    Debt Repayment Budgeting

Unlike the prior plan, a debt repayment budget is a “hardcore,” approach for those who “want to get out of debt quickly,” Farrington says.

How it works: Determine your monthly spending and minimum amounts due on credit cards and loans. Pay all the bills and then allocate what’s left toward paying off debts as quickly as you can.

“The debt repayment budget is only meant to be used for a short amount of time — maybe a few years at most. However, it can help you pay down debt quickly if you're disciplined and determined,” Farrington says.

5.    Pay-Yourself-First Budget

We like the sound of the pay-yourself-first plan, which is flexible and still helps you save and pay down debt. 

How it works: Allocate most of your earnings towards your bills and expenses, savings, investments and debt repayment. 

“The key is paying yourself first … you will move money into investments or savings accounts early in the month and you'll pay your credit card bills and other debts as soon as you get paid,” Farrington says. “With the Pay-Yourself-First Budget, you can spend the rest of your cash however you want.”

Budgeting Templates and Resources for Getting Started

●    If spreadsheets are your thing, you can find some budgeting templates here to print out and help you track your spending.
●    Don't forget to plan for seasonal expenses. This worksheet template can get you started.
●    We also love these resources on some hacks to incorporate to make saving your pennies part of daily life, stretching your grocery budget further and free budget spreadsheets/worksheets.
●    Set priorities about what you want to spend your money on. Are there expenses you can do without? has some helpful tips. 

Whatever You Do, just do Something 

Whether you wind up using a budgeting app or prefer old-fashioned pen and paper strategies, the most important step is getting started.

If it seems overwhelming or your debt feels out of control, take a deep breath. Know that putting a plan into place and starting to action your plan puts you on the right path. If your money matters are all a bit of a mess, remember it probably took you some time to get there. It will take also take some time to work your way out, so make sure you set realistic goals.
Any one of these strategies shows us that ‘budget’ isn’t a bad word. It’s a useful tool to help us get – and keep – on track!