Including Guilt-Free Spending Into Your Budget

As long as your personal finances look healthy, you should include guilt-free spending into your budget. Here’s why.

As you spend more time at home the past couple of years, your budget may have changed dramatically. Aside from taking care of your budget and savings, and allocating an amount for spending, you may also want to include another category into the latter, guilt-free spending. Read on to help you get started.

How guilt-free spending works

Basically, guilt-free spending is to cover expenses that you want. It could be gadgets, a pair of shoes, eating out, or traveling. When you are regularly dealing with many challenges and decisions, it’s nice to include rewarding yourself as a form of proper self-care. It creates a balance on how you handle your finances by not being too hard on yourself. Otherwise, you wouldn’t enjoy the process as much.

Three key areas should always be part of breaking down a budget, such as:

• paying your essentials;
• saving for long-term financial stability; and
• having some money you can enjoy now.
  

The trick to keeping these costs guilt-free is having some fun with your money without breaking the bank. These fun purchases should be important and help to enrich your life, such as supplies for a hobby like crafting. Your guilt-free spending must be planned ahead of time so you won’t upset your cash flow or take on debt.

Why does a typical budget usually fail? Too many restrictions can be the culprit in a sustainable budget. Most of the time, ‘sabotage’ in budgeting comes from losing the balance between saving the money for long-term stability and enjoying it now. Without enjoyment, you could start getting resentful. Without a safety net, a financial setback can occur. You always have to bring back the balance.

However, the best budgets always involve keeping your spending in check and ensuring you are geared towards priorities.

Budget framework to use when including guilt-free spending

If you’re still figuring out a framework to use, start with a basic foundation, the 50/20/30 budget. It divides up your budget into your key goals: 50% towards necessary expenses, 20% for financial wealth and stability, and 30% towards discretionary spending, no guilt involved.

The three-bucket approach is easy to set up, just make sure there’s enough room where you can access some money for your enjoyment now. You are free to adjust the percentages based on your financial standing.

Once the budget is created, you can have your bills automated every paycheck. With those vital things taken care of first, whatever spending you do next won’t disrupt your budget.

Take control of your budget

UBOMI puts you back in the financial driver’s seat by setting your goals, getting rid of debt, and seeing your progress along the way. The UBOMI app lets you connect to all your accounts by populating your finances such as loans, credit cards, mortgage repayments, and superannuation, into one easy-to-manage space.

With the help of UBOMI, you’ll be able to gain back control over your budget, a key step to good money management. Through the app’s notifications and smart advice, you’ll be on your way straight to your goals, whether to rid yourself of debt or simply to save, with guilt-free spending included.

If you liked our “Including Guilt-Free Spending Into Your Budget” and find it useful, check our blogs regularly for more info on how to get out of debt and updates on the best budgeting apps in Australia.