Financial Well-Being: How to Stay Happy on a Budget

By Amanda Roland
happy on a budget

Depending on your personality, the word “budget” either makes you excited or terrified. Some people see personal finance and budgeting as a game that will help save them money, but others see it as a set of restrictive rules that will strip away their happiness. The truth is, budgeting doesn’t have to be scary, restrictive or complicated at all! In fact, setting up a reasonable budget can make you feel accomplished and – dare I say – happy! Let’s find out how to stay happy on a budget.


At Banks Carroll Group, I talked to Certified Financial Planner Ashley Banks and Financial Advisor and Partner Donna Carroll to get some insights on budgeting, and they said, “A budget starts with figuring out what you are spending your money on. Then, it becomes about needs and wants. It basically just makes you think before you buy.” Whether you are making a monthly budget or yearly budget, you will set your budget to a certain amount and allocate your money according to your needs, expenses and amount of money you need to save. What makes budgeting hard is the little things that add up: coffee runs, eating out, unnecessary shopping, monthly subscriptions. It is best to identify and limit unnecessary expenses, but that doesn’t mean you have to eliminate Starbucks from your life! The key is moderation and planning.


Finding the “why” behind your budget is also very important, according to an article by Lauren Schwahn at NerdWallet, an online financial coaching site. Whether you are trying to get out of debt or saving for a big life event, knowing why you are doing something could make you more committed to getting your finances in order.

The feeling of accomplishment that comes with reaching your personal goals can also increase your well-being (aka happiness)! A study published in the Journal of Personality and Social Psychology followed students through one semester of school, and it found that the students who worked toward and attained their “motive- congruent goals” showed an increase in emotional well-being. This same concept can be applied to your financial goals!


Banks and Carroll suggest looking at websites and apps for free budgeting resources to help you! NerdWallet has a free budget calculator online that uses the 50/30/20 rule. According to their website, the calculator “divides your take-home income into three categories: 50% for needs, 30% for wants and 20% for savings and debt repayment.” This is a very basic way of setting up a budget, and it works very well for many people. Also, Banks and Carroll encourages people to set up rewards for themselves if they meet their financial goals! “If you save $20 on groceries… then you reward yourself with that extra money going into a vacation fund or maybe towards getting your nails done,” they said.

At the end of the day, we know that money can’t buy happiness. However, financial stability and well- being can lead to less stress, peace of mind, decreased anxiety and flexible spending, which can contribute to your overall happiness. A thoughtful budget could be the missing piece in your financial plan that could make you just a little happier.

Quick Budgeting Tips:

  • Use cash instead of cards. It is easy to swipe your card here and there, but using tangible cash helps you visualize how much money you are actually spending.
  • Have a goal! If you are goal-oriented, this could help you stay on budget. For example, start with a $100 savings goal for the month. If you reach your goal, treat yourself to something small like a big cappuccino from your local coffee shop or a new book!
  • Have an accountability partner or support group. No one likes to go through hard things alone, so having support from others is a game-changer. You can find online support groups to get involved with, or you could gather some friends to go on your budgeting journey with you. The more the merrier!

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