A Simple 3-Step Budget That Can Change Your Life

I’m confident this simple three-step budget can work for anyone in just about any situation.

Call it a zero-balance budget. It means that since every dollar has a job to do, at the end of the month, every dollar should have done its job and been spent, saved or otherwise set aside by moving it out of the checking account. Andrii Iemelianenko/Shutterstock

Budgets are like training wheels: They help you get moving and offer you confidence as you learn how to balance.

I wish I could come up with a better word than “budget” for managing money. While I’ve made peace with the word, it still conjures up synonyms like whip, drudgery, and cruel master. Personally, I prefer the more elegant term “spending plan,” but for now, because budget is so universally understood, let’s just go with it, all preconceived notions aside.

No Budget Is Fail-Proof

Search “how to budget” and you'll get a list of options a mile long. While there are many ways to budget, none is perfect. A budget is a tool you develop to fit your lifestyle. There is no single, guaranteed budget method, form, or spreadsheet.