Most people would rather clean the toilet than write a budget.
The real secrets of successful budgeting aren't about crunching the numbers. Success is about mind over matter, creating systems, and gaming yourself to make it work.
1 Set savings targets
Don't wait to see what's left over. Set a savings target and give the goal a name such as Holiday 2018, or Worry Free Retirement.
Use a visual reminder such as a screensaver to illustrate what you're saving for. Break down your goal into monthly targets and set up an automatic payment into a savings account at the beginning of the month.
2 Don't keep your money in one big pot
Systems help create behaviour with money. Try withdrawing spending money in cash, splitting it into envelopes for different categories and when it's gone, it's gone.
You could set up and have your incoming pay split into categories. The trouble with this is if there isn't a card associated with the account this is difficult to administer.
3 Allocate his 'n hers spending money
Or make that "me" money if it's just you. Budgeting fails if there aren't some treats or if a partner dictates what the other spends.
Everyone's budget is different. It might be $4 a week for a coffee or $100 for someone on a good income to spend on socialising and hobbies. It's really important not to moralise about what your partner (or you) are spending this money on.
If it's in the budget it's fair game.
4 Use the 50/20/30 approach
Author Elizabeth Warren has a formula where 50 per cent of your money goes to true needs, 20 per cent to savings and 30 per cent to lifestyle choices.
It's important to understand that "lifestyle choices" are spending such as fashion clothing, holidays, electronics, lunches, takeaways, luxury foods alongside your essential groceries and so on, which are often sneaked without thinking into the "needs" category.
5 Track your overspending
Work out the top three categories where you blow your budget and concentrate on them. Set yourself a challenge of reducing those categories by a monthly amount. You may get out of the habit of frittering money that way.
6 Be a contrarian
Don't buy what society tells you; don't run a balance on your credit card. Look at where your friends blow their money and do the opposite.
7 Set rules
You know your own weaknesses. Find rules that help you change your ways, such as keeping a diary of your spending, have a fixed time each month to review how you went, agreeing to a stand-down period such as one month or six months for purchases over a certain amount, or even assuming that every purchase is a want, not a need, until proved otherwise.
8 Find some mantras that suit you
This doesn't sound like a budgeting tool, but it works. I have a number of mantras I repeat to myself whenever I am overcome with wayward thoughts about spending.
"I have enough."
"Can it wait?"
"There is always a cheaper (or free) way."
I've also heard of people using morning mantras to keep their finances on track such as: "I don't need to buy things to make me happy."
Conversely, tackle that evil voice in your head that tells you: "I deserve it" or "everyone's doing it".
9 Put the kids on a budget
Whether they're 5 or 15 give them a budget and watch their spending patterns change almost overnight. What was an elastic band becomes a fixed cost.
10 Navel gaze
If it's still not working, drill down into your spending. Set up games with prizes that make you change your ways.
For example allocate a dollar figure bonus for every $100 over and above your budget that you save, or for paying down a certain amount of debt within a deadline.
Finally, I'm waiting for a New Zealand bank app that shows you "safe to spend" totals in budget categories rather than your bank balance.
You can do this with some budgeting apps such as PocketSmith.com, which show you a safe to spend total, which takes into account regular spending such as utilities that it knows are coming up.
Overseas banks such as Simple.com in the United States are realising that this is a real game changer for some customers.