budget hacks

5 Budget Hacks that Let Me Save 30% of My Pre-tax Pay


Budget Hacks

Let’s face it. Budgets suck.

A surprising stance from a personal finance professional.

Budgets, as we know them, seem to be more stick than carrot.

As humans, we respond better to positive reinforcement rather than punishment. So how can we be sure to get the carrot in order for us to make our financial cake?

Well, I’ve got some budget hacks to help you!

Conventional wisdom says we should save (they mean invest) 10% of our income towards our retirement.  If you are a woman, then you need to invest something closer to 12-15% to compensate for the unique money challenges that you face.
As if that weren’t hard enough, there are so many other competing goals.  Save for an emergency fund.  Save for a downpayment.  Save for a vacation.  That’s on top of all the everyday bills too.
Yeah, no wonder people give up on their budgets.  I certainly have at times.  I found these little budget hacks that helped me stay on track and maybe you could use one or 2 of them as well.

Value Judgement

Instead of creating traditional budgets that start with expenses and income, I started with values.
I love living in the neighbourhood that I’m in with its quirky indie shops and colourful residents.  So I put money aside for mortgage/rent. I respect the environment and I hate the stress of driving in traffic, so I put aside money for public transportation.  I’m fulfilling a childhood dream by taking martial arts classes.  So while it’s not cheap, I can see it as money well spent and put money aside for that as well.
This mindset shift makes sticking to a budget less of a punishment.  It’s framed as putting my money towards what’s important to me. It also makes it easier to cut out some expenses.
For example, I stopped going out for happy hours because I found that, while getting a drink with coworkers or friends was fun, I could get the same enjoyment out of having a coffee with them.  More importantly, being slightly buzzed prevented me from enjoying the rest of the night with a book or going to the gym.  Both things that were more important to me than alcohol.

Name Them if You Are Going to Keep Them

Each of my savings goals has a dedicated account.  None of this 1 big melting pot where everything is muddled together.  Next, I name each of these accounts a something special to me.  Instead of “savings”, I may name one “African Safari”.  When I see this name, it makes it harder to “steal” from the vacation fund for a new pair of jeans.
Try it.  Imagine what you want your next vacation to be, or what you dream your pie in the sky retirement would be.  Name it “Beach house in Maui” or “Cabin in the woods.”  Makes it more motivating to put money in the account and see that account grow!

A Picture is Worth A Thousand Words

Next, for me to stick to my budget during the day-to-day grind, I put a picture of the goal in plain sight.  I might stick it on my credit or debit card/wallet. If you are internet shopper, maybe as a sticky note on your monitor?
A small picture of your dog on your debit card can help motivate you to save for an emergency vet fund.   C’mon, you can’t steal from your fur-baby! She’s depending on you!
Having a visual reminder of what I’m working towards helps me in situations where I might spend out of habit or on autopilot.

Easy Does It

I did not start off saving 30% of my pay.  No one expects you to go from 0 to 60 in 2.3 seconds.  I started with what I could and worked my way up.
I started with a small amount, but I made the savings automatic.  I set up re-occurring transfers from my checking account to savings/retirement accounts on payday.  Seriously, I can’t be trusted with remembering when to make the transfers. I’ll forget and put it off and next thing you know, I’ve spent that money.
I also readjust the transfers each year.  I work in an industry where I get a year-end salary adjustment.  It’s 2-3% each year. That might not sound like a lot, but in 5 years, that’s 15%!  Think about it, if you can only save 5% this year, but in 5 years, you could be saving 20% and not feel much different.  It does add up!
If you know you could be saving more, but don’t want to feel deprived, set up these transfers to increase 1% every month or every 2 months until you hit your target.

Subscribe and Save

Subscriptions get a bad rep most of the time.  Personal finance columns vilify them.  But I think they can be used strategically.
A couple of years ago, I bought myself a 3-month gift subscription for a jewelry box subscription.  I combed through their social and I liked their style.  It’s not what I would have picked for myself and it was cheaper than buying the pieces retail.  Those pieces breathed new life into my existing wardrobe.  It allowed me to stick with my current clothes, but change things up with a necklace.
And because it was a gift subscription, it just ended after 3 months and I was no longer charged. It controlled how much I would spend in that specific area without having to rely on willpower.  So if you know you are a Sephora-holic, or a makeup addict, subscribing to a beauty box can limit your yearly spend in those areas.
This strategy doesn’t just work on discretionary items, but with essentials too.  I used to subscribe to certain products through my Amazon Prime membership.  Having those items delivered not only saved me time from going to pick them up, but it also prevented me from throwing extra, impulse purchases in the cart.

It All Adds Up

I’m rebellious by nature.  If you tell me to do something, good chance I’ll do the opposite.  It’s just a streak I have in me.

So in order for me to get out of my own way financially, I’ve had to come up with budget hacks that work for me.  If you’ve been having trouble sticking to your budget, why not give these hacks a go?  What have you got to lose?  Not money.

So, to sum up, look at your budget as a representation of your values.  Are you spending on things that just don’t mean that much to you? Are you starving areas that light you up?

Next, remind yourself of these personal goals with unique names and pictures.  You’ll see just what you are cheating yourself out of if you start to slack on those goals.

Finally, make things easy for yourself.  If you are too busy or frazzled to keep track of if you already have dish detergent under the cupboard the next time you are in the grocery store, sign up for auto-delivery every 2 months.

If keeping track of how much money you have left after pending bills, transfer those amounts out of your account automatically on payday.

What other budget hacks can you share?  Have you tried any of these before and how did they work?

Remember to subscribe if you want to be notified next time I have a new article up!

Subscribe below to have content sent straight to your inbox for free!


2 thoughts on “5 Budget Hacks that Let Me Save 30% of My Pre-tax Pay”

  1. Great ideas! I love the point about values driving your savings, as well as the visual reminders of why you’re saving. A picture can be such a powerful motivator, especially when the numbers don’t cut it!

Leave a Comment

Your email address will not be published. Required fields are marked *

This site uses Akismet to reduce spam. Learn how your comment data is processed.