Best Way to Budget Your Money

I feel your scepticism as you read the title ‘Best Way to Budget Your Money’

But you clicked in… Have you clicked in to this article because:

  • You know you’re not meeting your financial goals?
  • You’re thinking a budget might help but you’re not convinced? Or
  • You have no idea where to start to change your financial situation?

budgeting None of us like the idea of a budget. Why?

Because it implies we need to stop spending, which is often associated with no longer having fun. But what if I asked you to challenge that mindset? To change your thinking to one of long term financial freedom? What if budgeting or let’s call it, living within your means, meant you could meet your needs now but also have money growing for your immediate expenditure (yes including fun money) and mid term and long term financial goals?

This article will outline, in my opinion and experience, the best way to budget your money and the story about how I used it first hand myself. So do you want to know the best way to budget your money?

I hear you say ‘Yes please!

Before I share with you the pain free budgeting strategy that turned my financial situation around, allow me to share with you why I was motivated and a part of my story from a short time ago.

My story

Less than 18 months ago, after many years of financial success, I was in a financial position that was not healthy, if anything was near bankruptcy. It had taken me by surprise because I had buried ‘my head in the sand’ and now I could ignore it no longer. I think I was embarrassed to admit to myself how my unpredictable income had taken its toll on my stress levels; that the risks of small business and single parenting was simply too much while I was going through some health challenges. So before it got any worse I looked myself in the mirror and I made a commitment to myself. That commitment was to reduce my stress and to take financial responsibility for the long term and to turn my financial situation around.

It seems crazy that I experienced this because I have:

  • Been trained as a young adult on savings and basic investment strategies;
  • Mentored hundreds of people in property investing and
  • Successfully invested myself in the past

It was a bit like the plumber that has leaky taps in their own home. I was giving and teaching to so many others I had turned a blind eye to my own cash flow and financial position.

For further information on my journey please go here to my About Me page.


In less than18 months I have turned it all around. I have taken back control. I have a plan and I am taking action. In fact, I’m enjoying a fulfilling, meaningful lifestyle, living within my means; ‘dominoing my debts’ and planning for my long term financial independence. Plus I have my health back because my stress levels are down and I’m feeling back to normal.

How did I do it? What resonated with me?

It was in November 2016, that I took my Accountants suggestion to get a part-time job, because my business income had reduced in size to a part-time income. Therefore ‘getting a job’ would give me some breathing space and reduce my stress levels. So I did. Now this part of my story was my personal decision. I chose getting a job but finding an alternative source of income is what you could do here. I’m definitely not saying getting a job is the only answer. Although I currently have 2 part-time jobs I also am building new business interests again now that I’m back on my feet healthwise and financially.This was the right decision for me at this time, you will know what is right for you.

Now that I had a predictable income, my health could recover. But I still needed to pay down debts and save money. However I also wanted to enjoy a reasonable lifestyle in the meantime. A tall order? Maybe but I have achieved it and you can too.

How I have it all

In January 2017, I bought myself a New Year’s gift. Scott Pape’s book ‘The Barefoot Investor’. I was on holiday and I read it in 2 days (then I went back over it chapter by chapter). After reading his budgetting strategy (in chapter 2) that he wrote for his wife ‘on the back of a napkin’ I was hooked. I will focus on this strategy for the purposes of this article however his book takes this simple strategy (that works) and takes you step by step on setting up your immediate, short term and long term financial goals to achieve financial independence as soon as possible. Although Scott is an Australian financial planner, this budgeting strategy will work no matter where on the globe you are.

What I love most about Scott’s strategy is it gives you immediate gratification as well as saving for your future. He calls it ‘setting up your buckets’. It really is that simple. Setting up 4 buckets. Plus it is easy to convert to your pay frequency: weekly, fortnightly, monthly or irregularly.

Setting Up Your Buckets

His 4 buckets are: Income, Blow, Mojo and Grow. Scott says to divide a percentage of your income into each bucket. E.g.  for the Blow bucket (60% for bills and living expenses, a portion for fighting off financial fires plus 10% ‘splurge’ what I call my fun money); safety money is MOJO savings for when something goes wrong, such as your income reducing unexpectedly (as I had experienced) and long term wealth he calls the Grow bucket.

For me, I enjoy socialising and therefore spending money going out with friends and family. This helped because when I am paid from no matter what source, I simply allocate it according to this simple plan. It has taken the stress out of budgeting. In fact, I don’t feel as though I am budgeting because I still have money for fun or to splurge and also money for immediate and long term goals. I say win/win.

A tip

Please note, this is not a miracle worker. If you keep spending more than you earn you will not achieve financial freedom. For this strategy to work, you need to make sure that your lifestyle actually fits within his guidelines. For example, when I started, my bills and living expenses far exceeded the 60% for bills etc he suggests. Therefore I did 2 things, I increased my income and reviewed all my expenses. Again, strategies from the book including helpful tips and scripts to action. Everyone will get something slightly different from this book. For me, I am crazy about his bucket strategy. It truly has put me right back on track in the short and medium term and I am now working on my long term financial goals. Including using an automatic savings app.

So what now?

If you’re looking for the best way to budgt your money? A simple and straight forward strategy that you can implement immediately? Then this is the one for you to consider. Frankly, if what you are doing now is not working, what have you got to lose? I recommend:

  • Make a commitment to yourself to take financial responsibility for your current situation
  • Buy a copy of the book ‘The Barefoot Investor’ by Scott Pape
  • Read it
  • Take Action and
  • Share the love. If it works for you then tell someone you know and your positive experience.

Fleur Allen

Fleur is an Australian Best-Selling Author, Business and Property Mentor. She is passionate about empowering business professionals to turn their Passion into Profits; Grow their Wealth through diversified investment strategies and Live a Life on Purpose. Receive Freebies (free websites, free mentoring) from her blog Passion to Profits at

18 Replies to “Best Way to Budget Your Money”

  1. A really good article, and one which rang a few bells inside my head when it comes to familiar situations. 

    I also ended up in a bit of a sticky situation financially last year, and my monthly wage packet seemed to be slashed in half. I’m not 100% out of it yet, but I am in a slightly better place now. 

    How long did it take you to claw your way out of the financial trouble?

  2. Hi Fleur,

    I truly enjoyed reading your piece about how to budget your money and Increase your income. Come to think of it I never thought of it from this angle. The thing about your article is that it brings something new to the table that I have not read anywhere else. Keep up the good work and please enlighten us with these wonderful insights, for people who are striving to make a passive income.

    1. Thank you Sam I appreciate you taking the time to share that my article shares something new about how to budget your money and increase your income. These strategies certainly have worked for me. Do let me know what works for you.

  3. Hi Fleur

    good post on savings. I am a financial advisor by profession and unfortunately, many people dont save.

    scott was right – your expenses shouldnt be more than 60% of your income. and there should be a default savings of 10% as a minimum every month – i call it my black ops savings because it just disappears to another saving account which i dont have a debit card or cheque book for.

    As Warren Buffet said, “Do not save what is left after spending; instead spend what is left after savings.”

    1. Thanks, Tarun really appreciate your comments from a financial advisor point of view. Yes, saving is completely underestimated and undervalued. I am teaching my 12-year-old son that he can plan and save so that he never has to have what I call ‘bad debt’ credit cards, personal loans etc. Yes, it is an important discipline to spend what is left after savings. Definitely a good feather to take out of Warren Buffet’s cap

  4. Your post is very helpful to those who don’t know how to control their spendings/income/investments. I liked your story. It is important to reach your financial freedom to become calm and wealthy. You need enough income, savings and profitable investments.

    The Book of Scott Pape is probably very good because it helped you to change your life and become successful. 

    1. Thanks, Gno for your comments. Yes, the Scott Pape book is a very simple strategy that helps you to save but also you don’t feel like you’re budgeting or depriving yourself which I think is very important. He claims it to be simple and straight forward and it absolutely is.

  5. I will have listened to you very carefully because you are talking to me .I have been working for while but I can say that I have saved enough for the future this bring me to realize that I still have alot to learn and acts on what I am learning this blog has helped to mirror myself and I am not in very good condition financially so why not  start with the book  and learn few tricks ,

    1. Absolutely Charles, start with Scott Pape’s simple budgeting strategy that he wrote on the back of a serviette for his wife years ago – it is what I use and it definitely works. And it works no matter what income you’re on because it is working in percentages. Go for it make a start today!

  6. Thank your for sharing these practical tips on budgeting. I must admit, I never truly understood the importance of setting a specified budget until I myself had to experience the headaches of family budgeting after having my own family.

    I especially like the idea of “setting up a bucket.” I believe this is a great way to track every penny that you’re making and it also enables you to set aside a specific amount each month for future use. Living within or even below your means is something I had to learn the hard way, and I’m glad that you mentioned it here. 

    1. Yes, Alice, living within your means absolutely is the way to go. If you don’t then you need to increase your income. It really is that simple. It’s important to take away any emotion such as stress and just get back to the numbers and then make a plan from there. What I share here enables you to make that start and it is important to make that commitment and start today.

  7. Hi Fleur, your piece held me spellbound. Congratulations on getting back on your feet both financial and health wise. I have been there, so I can relate well to that. The buckets formular is quite interesting. Budgeting really requires lots of discipline as one needs to let go certain frivolities in order to achieve financial freedom, if not it will simply not work. And you rightly opined same, that the formular is not a miracle worker. If one spends out of his means, financial freedom will be a mirage.I am glad to have read this your piece, at least I have learnt interesting things, especially the Income, Blow, Mojo and Grow buckets.

    1. Great Gracen, I’m delighted to hear that this article has been helpful to you. As much as a disciplined approach is required to achieve financial freedom, Scott Pape’s budgeting strategy helps you to save plus in a way where you don’t feel completely deprived with his Splurge bucket (which is within the bigger Blow budget). I think this is the key to his success is he understands we are all human and we still need to treat ourselves even in a small way on the journey to achieving our financial goals. Then we can reap the benefits once mortgage free is obtained and enjoy the latter years of life with much more choice, freedom, and opportunity.

  8. Hey there Allen,

    thanks for such eye-opening and informative article, i truly enjoyed reading it and learning some new things today! I will be first to admit that prior to reading this article for quite a long time I had this mindset that if I am not being able to spend money, that means the end of having fun, because You end up compromising Yourself on many things in lfie that bring joy and entertainment. I would choose having fun over the needs and smart investments, and I always wondered, how people manage to have such healthy financial status to be able to afford both o these things- fund and smart investments in one? Your story Allen was truly very motivating and I am also thinking about mixing my business with having a part-time job till I get to the point where I will feel very comfortable with my online business income. I found Scott’s strategy of ”setting up buckets” to be very interesting and appealing, as it manages to smartly & effectively divide each portion of Your income for different necessities, expenses and needs, therefore inspiring a person to make smart financial decisions and be more responsible. Having everything calculated would result in more serious & effective approach to seek for a stable financial status and not end up in a situation where a person would broke not because necessarily because he doesn’t have money for his. or her necessities, but because he or she didn’t use those finances correctly. 

    Keep up the great work Allen and best of luck to You 😉

    1. Thanking you for your comments. I absolutely endorse and support your decision to take financial responsibility and to have a part-time stable income while you are building and establishing a reliable business income. I see all too often people quitting their jobs and go into business and wonder why they are under financial stress within a short amount of time. Go forward to make a plan, commit to it and start taking action today!

  9. This is a great article!  Spending more than what is coming in is the most common reason for people to run into money problems!  I really like the “bucket” method and it seems very easy to follow, and especially that there is room for fun too!  There is nothing more depressing than budgeting and deprive yourself.  It has to be a fun thing if it’s going to work. I also have an automatic deduction that goes in a savings account, so I guess I have part of the plan already going.

    After reading your article, my next step is to read “The Barefoot Investor”!  Thanks for the inspiring words!

    1. Thanks, Denis, I’m delighted you found this article helpful, and we now have so many temptations to take us away from living within our means but it really is that basic. Spend less than you earn. As you know I highly recommend to go read ‘The Barefoot Investor’ it truly is worth every penny.

Leave a Reply

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