We all know budgeting is important. It helps you do things like prepare for retirement, save for big expenses like college tuition and avoid the stress of high-interest debt. But let’s be honest: budgeting takes time and effort, and it can feel overwhelming at first.

The good news is that budgeting doesn’t have to be difficult. In fact, there are several simple methods you can try, each designed to help you take control of your money without all the hassle. Let’s explore three popular budgeting methods that can help you manage your finances with ease.

Online Budgeting Tools

Online budgeting tools are a great option for modern money management. These tools are easy to use, and many of them are free or low-cost. They automatically track your income and expenses, giving you a real-time view of your finances.

Horizon members have free access to Money Tracker through online and mobile banking. This tool makes it easy to see exactly where your money is going, set limits for different categories and adjust your spending if you’re getting close to your budgeted amounts. The automatic categorization of expenses helps you quickly spot trends to help you plan. You can even sync accounts from other financial institutions.

But Money Tracker isn't the only budgeting tool out there. Others include Monarch, EveryDollar, YNAB and Quicken. Each tool has a different user interface and focus. You can often get a 30-day free trial to test them out and find which one works for you. If you find one is more intuitive to you than another, go with that one! You're more likely to use the tool and gain the benefits if you like it.

Using Separate Accounts

If you prefer a hands-off approach but still want a clear way to separate your spending categories, using separate bank accounts is another excellent budgeting method. This approach is similar to the envelope system (detailed below) but takes advantage of digital banking.

Here’s how it works:

• Open separate checking or savings accounts for specific categories of spending, such as Mortgage, Groceries, Savings or Entertainment.
• For each paycheck, deposit a predetermined dollar amount or percentage of your paycheck into each account.
• When it’s time to pay a bill or make a purchase, the money will already be set aside.

By using separate accounts, you ensure that each category is funded and ready to go when you need it. This method helps you avoid the temptation to overspend since each account is designated for specific expenses.

If you use online banking, you can set up alerts for low balances in any of your accounts, making it easier to stay on track. Plus, there’s no need to carry cash or physically separate funds, as everything is handled through digital transfers.

The Envelope Method

Of all the budgeting methods, the envelope system may be the simplest. While it may feel a bit retro in today’s digital world, it’s still an effective way to manage money. It's especially good for children since kids are likely to be paid in cash and the tangible aspect of the system can enhance learning.

Here’s how it works:

• Label a set of envelopes with your main spending categories. For adults these might be categories like Mortgage, Savings, Gas, etc. For kids they might be simpler categories like Spend, Save and Share
• When you receive your paycheck, divide it up and place the designated amounts of cash into the corresponding envelopes.
• When it’s time to pay a bill or make a purchase, only spend the cash from the envelope that corresponds to that category.

The benefit of this method is that you can only spend what you’ve already set aside, helping you stay within budget.

While the envelope method is less common today due to the rise of digital payments, it’s still a great choice if you prefer tangible, cash-based budgeting. Plus, it’s easy to understand and stick to if you’re committed.

Start Your Budget Today

No matter which budgeting method you choose, the most important thing is to start. There’s no one-size-fits-all approach to budgeting, so experiment with these different methods and find what works best for you. Whether you choose the classic envelope system, embrace technology with online tools or keep your spending organized with separate accounts, the key is to find a strategy that helps you stick to your financial goals.

If you're not sure where to begin, try Money Tracker today! It's free for all Horizon members and has all the tools you need to budget successfully.

Budgeting doesn’t have to be stressful. With a little planning and the right approach, you can take control of your money and start building a more secure financial future. The only poor choice is not budgeting at all. Without a clear plan, it’s easy to get caught up in debt or miss out on important savings opportunities.

Start today, and before you know it, you’ll have a budgeting system that works for you, your family and your financial goals!