18 tips for creating a budget in the new year

Before sitting down to make a budget, it's a good idea to gather your check stubs and other sources of income to have a full picture of the money you've actually got. Once you've done that, you'll have a good idea of how much money you can budget for saving and fun expenses once the bills are paid. 

It's tedious, but sit down and write (or make a spreadsheet) with all of your monthly expenses, and make sure it's extensive. Include all those streaming TV subscriptions, and a rough estimate of your monthly grocery budget and you'll have a better picture of what you've got going out every single month. 

Whether you're looking to pay down debt or build up a savings account, it's best to set goals that are actually attainable. Make a plan to save a set amount of money, or pick an account to pay off first so that you can build your budget in a manageable way. 

Once you've figured out your income and expenses, determine exactly how much of your cash you can stock away in savings. Even if it's only $20 a week at first, that cash will add up quickly. 

Forgetting to pay a bill almost always means incurring a late fee, and those add up throughout the year. If you've got the financial cushion, set up your bills on auto-pay through your bank account to avoid missing a payment. As a bonus, on-time payments will also help boost your credit score. 

If you're struggling to create your own budgeting system, remember that there are plenty of budgeting platforms that are available to help. Apps like Mint and You Need a Budget can help you figure out how to save and pay off debt with just a few swipes of your finger. 

Now that you're aware of all your expenses, it's time to figure out where to trim the fat. Consider canceling a streaming service you don't watch often, or look into platforms like Truebill that can work with internet providers and other utilities to negotiate lower rates. 

If you're able, it's a good rule of thumb to set aside at least 20 percent of your earnings in a savings account. If that's not possible, start with a smaller percentage, maybe 5% or 10%, until you're able to contribute more to your savings. 

An emergency fund, or a savings account that can pay for 3-6 months of your expenses in the case of an emergency, is a must. At the beginning of the year, start socking away cash each week until you hit that target, then use extra funds to start paying down debts or put into long-term savings. 

If you can't see it, it's hard to spend it. Consider having a portion of your paycheck deposited directly into a savings account. It will be harder to spend that cash on frivolous expenses, and you'll build up a nice stockpile of cash without really even noticing the dollars missing from each direct deposit. 

When it comes to paying down debt, it's smart to pay off the accounts that are accruing the highest interest first. You'll save cash in the long run, and be able to put more of your money toward other debts that need to be paid.  

If you've got a spending problem, it might be a good time to consider cutting up your credit cards. Closing the accounts can have an impact on your credit, but keeping them open without any major spending is a great way to boost your credit score while paying down debts, and you've still got that line of credit in case of an emergency. 

Most people give up on budgeting because they set parameters that are too strict, making the budget impossible to follow. Set aside cash for date night, impromptu take-out dinners, and other fun expenses so that the budgeting process doesn't feel like such a slog. 

There are so many different ways to budget, from the Dave Ramsey method to the 20-50-50 method, and not every budget is right for every person. If you find that a system isn't working for you, figure out the pain points and choose another plan that fits best with your budget and the way you spend. 

Surprise expenses, from sudden car repairs to impromptu travel, are an inevitability. In addition to your emergency fund, set aside some cash that can be used when something comes up so that you're not struggling to take that money from other places. 

Even if you don't know how to balance a checkbook, your bank's online banking portal can provide a ton of insight into the way you spend. Make a point to check it regularly, at least once a week or so, to stay on top of your spending and to catch any potential fraud if it happens. 

Debit and credit cards make it easy to spend cash without much thought, but studies show that people spend less when they're dealing with cash. You can't exactly pay your bills with cash, but if you're struggling with discretionary spending, withdraw a specific amount from the ATM each month and when it's gone, it's gone. 

No-spend challenges are growing increasingly popular and can be a good way to reveal what you're wasting money on. Consider a no-spend week, where you only eat at home and don't go shopping, or go even more hardcore with a no-spend month that can seriously boost your savings.