Glen and John's top 21 budgeting hacks

There’s always room in our budgeting system to make it even more efficient and effective. Glen and John dug deep into their money management tips jar and pulled out 21 budgeting hacks you can implement today to get the most out of your budgeting plan. Make sure you listen to the effective budgeting series below to hear how these tips can work for you.

Let’s get into the good stuff!

1. Use Glen’s value-based-budgeting model – 10/10/30/50

This is a percentage based model that allocates 10% to giving, 10% to investing for your future, 30% max on housing, and the remaining 50% to whatever you value after that.

2. stop overspending

This is a problem for many people – it doesn’t matter how smart your budgeting system is – if you are overspending you will always destroy any chance of a successful system. Change your habits at the start of the process.

3. audit your expenses and spending

This is another area where people are bleeding money and not even realising it. Have a look at your bank statement and highlight the payments coming out each month. Is there something being direct debited you didn’t know about? Do you really need a subscription for Netflix, Stan, Amazon Prime and Apple? Can you get a better deal on that insurance? Ring them and ask! Really question each regular transaction.

4. make a habit the goal

Habits are the key to long term change. If you are a chronic online shopping over-spender, find a way to change that habit and stop that cash in its tracks! A great book from Glen’s recommended reading list all about this concept of habits is ‘Atomic Habits’ by James Clear.

5. pay your bills annually

Many of your regular payments could become cheaper if you take the annual payment option. When you’re auditing your expenses see if there’s an annual option – you could be saving some serious cash.

6. pay your mortgage fortnightly

With the way the calendar works making this change will mean you make an extra mortgage repayment each year (when compared to making monthly repayments). The same also applies to making weekly payments. Doesn’t sound like much, but over the course of a number of years it really adds up.

7. use cash for day-to-day expenses

This quarantines what you have available to spend. For some people this is perfect – keeps their dirty mitts off the debit card and restricts what they have available to spend while they’re out and about.

This lady has the right idea.

8. separate, calculate and quarantine your fixed expenses

This ensures your basic needs are covered and you can’t go blindly spending that money, then wonder why you have no money for rent [duh]. Put the cash for your rent, mortgage, utilities, groceries and so on away from where you can use it for unnecessary things.

9. build only the minimum repayments of debts into your budget

Real talk. We need to address our debts, and the first step in ensuring we’re dealing with them is to stop pretending they might just disappear if we ignore them for long enough. The second step is to set up the minimum repayment for things like credit cards and personal loans. From there you could look at things like the Debt Snowball if you’re keen to tackle the debts head on. Have a read of Glen’s tips for getting the Debt Snowball under way.

10. use percentages as a guide (e.g. ~30% of net income max on housing)

You could use Glen’s 10/10/30/50 rule, or a percentage formula that suits your needs. This ensures that everything is allocated cash as it’s needed, whether you have a week where you earn a few hundred bucks, or a few thousand – the money is being siphoned away for where you will need it. It’s also simple – don’t make budgeting complicated.

11. give it time

It might take a few pay cycles for you to see the results you’re looking for from your budgeting system. Let it sit for a while and see how it works out. If that system doesn’t work, readjust it or trial another option.

12. build an automated system that works for your money personality

We all have a different money personality – some people are natural spenders, others are savers. Some people might sit halfway between those. A natural spender might find it useful to automate their savings each month, because given the chance to touch that cash, nothing will be saved. Automation saves thinking and builds whatever you want to build without having to work too hard.

13. your way is ok if it’s getting results

This is a point about confidence – if you have a budgeting system that is working, then stick with it! Budgeting is one of those things that is so personal – if you’re getting the results you want then keep using that system. If not, then look at what other options you have available to trial. Remember #11 though – whatever you try, give it time to see its results.

14. get your partner on board

You gotta be a team. You’ll always achieve better results when you and your partner work together – your energy and cash will align like a dream team. Have a chat about what you want to achieve with your cash and setup the budgeting system that achieves that.

15. keep an eye on your budget (e.g. apps, online tools)

There’s a heap of options out there for apps or digital tools that can help you track your expenses and savings. Check out things like any services your bank offers, get a good ol spreadsheet, or Google apps like YNAB, Mint, PocketGuard or Clarity Money.

16. set your payments to weekly (if you get paid fortnightly/monthly)

This is particularly relevant to sole traders or contractors, but also those whose salary is paid fortnightly or monthly [ouch]. With the payments that come into your account setup a weekly amount to be available for you to spend. This creates the illusion of ongoing cashflow, and prevents you making the oh-so-inevitable move of spending everything you have the second it drops into your account. You know, when you live like a king for one week then realise you have nothing to pay rent for the rest of the month. Genius. Absolute genius.

17. make a trade-off if needed (e.g. cancel the gym to redirect that cash elsewhere)

Sacrifice is needed! Do you really need all those streaming services? Probs not. Do you actually use your gym membership, and is there another way to stay fit for free? Take a look at all of your expenses and see where you can sacrifice even harder. Can you live somewhere cheaper? Grow your own food or join a community garden to cut down on groceries? Is there a cheaper phone bill option with your provider? Sacrifice is short term pain for long term gain.

18. the 4 adjustments you can make to a budget – decrease expenses; decrease savings; increase income; cut something out completely

Take a look at your budget and consider these 4 options - which of these can you apply to make a difference to your budgeting system? How can you make room for the things you truly value - do you need to cut spending, or increase your income? If your system isn’t working these are the first 4 things you can try to tweak it.

19. have the you of tomorrow in mind

Glen’s 10/10/30/50 model builds in 10% for investing in the you of tomorrow - why? Because the best time to invest in the you of tomorrow is TODAY. Don’t wait 30 years and wonder why nothing was invested 30 years ago when you had the chance. Make it a priority to invest in yourself now.

20. include giving in your budget

Glen’s 10/10/30/50 model also allocates 10% to giving because if you’re able to cover your basic needs to live (food, water, shelter) then you truly are rich. There are many people in the world who cannot provide the basics for them or their family which is heartbreaking. There’s still work to be done in the world, and we can all contribute, even a small amount. my millennial money supports A21. Find your favourite charity or organisation to support, or if you want some more guidance check out Peter Singer’s organisation, The Life You Can Save.

21. avoid lifestyle inflation

Ah this old chestnut. Just because you suddenly earn more, doesn’t mean you should spend more. If you get a payrise, start a side hustle, or get a lump sum like a tax return, don’t blindly spend it. Pretend it doesn’t exist and allocate it to something you value like savings, or to paying off debt. Buying designer handbags to house your designer dog? Maybe not.