Best Budgeting Practices

Higher Rewards
3 min readJun 7, 2021

Budgeting can be time-consuming and difficult. We lead busy lives with school, work, family, and more so setting time aside to do what seems like another burden does not sound very appealing. In fact, only one in three Americans create a detailed budget every month. That being said, however, there is no need to worry when it comes to saving. Here are some steps to easily budget so that it doesn’t have to feel like a burden:

Calculate your fixed costs per month

Many people think that they have to keep track of every single one of their expenses, no matter how small. This just turns into a rummage of receipts and a lot of headaches. What is more important is to split your expenses into just two categories — your fixed and variable costs. Your fixed costs are those that do not change/stay pretty consistent from month to month such as rent, utilities, debt, etc. You should know approximately how much this comes out to per month and allow for a little leeway. Everything else comes under variable costs, whether it is food, travel, or recreation. Once you subtract those fixed costs from your income per month, assuming that income is constant as well, you now have money that you are more flexible to work with.

Figure out how much you want to save

This differs for everyone. It really depends on your goals — are you looking to save for a new car or a new house? Do you want to financially support other people? Are you not as focused on saving but rather want to spend more on things such as travel? The best thing to do is set aside a certain percentage of your income that you want to save depending on your goals. Check how much that new car would cost and how long you want to wait to buy it so that you can calculate how much you have to save each month to achieve your goal. If you aren’t sure of your goals, which is perfectly fine, a good rule of thumb is about 20%. Now, you have the rest of your money to spend on whatever you want!

Download a budgeting application

There is no need to be accounting on pen and paper anymore; there is so much technology out there to make budgeting for you so much easier. One great app is called Mint, which is completely free to use. You can add all of your cards, cash, investments, bills, subscriptions, and more. If you want to categorize your spending, you can do so on the app and set budgets for each category. There are several other apps out there as well, so look into what features would be best for you and check out which app can best suit your needs!

Stick to the budget!

This should go without saying, but it can be really difficult to stick to your budget, especially if you are used to spending more than you want to. Ensure that you put the right amounts of money into your checking and savings accounts and stick to drawing from your checking account for your daily wants. If you find yourself constantly wanting to spend more, then perhaps it is time to look into new ways to save, such as canceling subscriptions that you barely use or getting a roommate if your rent and utilities are too expensive.

Budgeting should be an easy and simple process, not a stressful one. Hopefully, these tips will help you create a simple budget that you can follow consistently. Not only that but if you want to donate to causes you support but can’t seem to fit it into your budget, look no further. With a Higher Rewards credit card, 2% of every purchase you make will go back to an organization you support; there is no need to set aside money in your budget because it is already accounted for!



Higher Rewards

Making Passive Donations™ is easier than ever. Recommend your organization to thrive, not survive. Head to to learn more.