I hate budgets.

No system has ever worked for me, and frankly, inspecting my erratic spending habits usually gives me anxiety.

However, I want to financially prepare for a drastic change in my life, so I need a way to reliably put money aside each month.

This is the strategy I will be using to hit my savings goals the next few months.

Throw Away The Categories

Instead of budgeting small sums here and there for various things, I looked at my statements and identified four things which are important and easy to track.

1. monthly income (post tax)

2. fixed monthly costs (debt, rent, car, phone bill, subscriptions, etc)

3. necessary variable expenses (groceries, gas, electric, etc)

4. monthly saving goal (how much money you want to put away)

The Rest of Our Expenses are Runway

I know how much money I expect to earn, how much I expect to go towards regular expenses, and how much I will save.

The rest is my runway, which I am free to go spend however I want.

runway = income - fixed costs - variable necessary expenses - savings

How To Budget With Runway

The number I will use to make any spending decisions is my runway - how much money is left over for me this month.

ALL my other expenses come out of my runway for the month - a $5 pastry, eating out with friends, a haircut, a ski trip, etc.

If something comes up, like a medical cost or a car repair, this also comes out of my runway.

Now it's easy to make decisions on my spending.

If I have a $300 car repair and that puts me over, then I can't buy those concert tickets or book that trip. No more categories, no more overwhelming.

The only thing I have to do is keep a google sheet where I can jot down each expense, and watch it eat into my runway.

This process is manual, but incredibly simple and forces me to keep an eye on my spending. For the first time ever I am excited to budget.

And hopefully in the near future, I can be using a simple app to do just this!