When you’re trying to save money, it makes sense to give yourself a budget. The stricter, the better, right? Suddenly, you stop buying coffee, clothes, and concert tickets. You give up on going out to dinner with friends, and you don’t even think about throwing that pint of ice cream into your cart.
Of course, counting pennies is necessary sometimes. But if you have more wiggle room, restricting too much can actually slow down your long-term progress.
“If you over-restrict yourself from the get, you’re going to fail, you’re going to hate budgeting, and you’re going to give up and spend all your money,” said creator @alisontalksmoney in a viral December TikTok with over 40,000 likes. Instead, she recommended tracking your spending for a few weeks so you understand your current cash flow, and then creating a sustainable budget.
Creator @coachingwithnik pointed out the same thing on Jan. 5. “It’s not going to make you save more,” she said. “It’s going to do the opposite. I would eventually feel deprived, and then [splurge.]”
Here, financial experts weigh in and share tips for striking a better balance.
You Don’t Need A Strict Budget
According to Alison Fyhrie, a financial advisor at Northwestern Mutual, having a rigid budget isn’t the same as being good with money. Instead, she says being intentional with your spending is what matters most. “At the end of the day, budgeting is a tool,” she tells Bustle. “It helps you understand how you’re spending and whether that spending lines up with your needs and priorities.”
That’s why month-long “no spend” challenges and other ironclad rules rarely last. A looser framework will still keep you on track to reaching your financial goals, Fyhrie says, while also helping you maintain them long-term.
By avoiding a strict budget, you’re less likely to feel deprived, which is something that can cause you to eventually overspend and splurge. For example, imagine you go a few weeks without getting your favorite takeout — not even once. It makes sense that you’ll eventually swing the pendulum the other way and go on a spending spree. Cue back-to-back-to-back UberEats orders.
“If there’s no room for flexibility or moments of joy, it can quickly feel unsustainable and even discouraging,” says Isabel Barrow, executive director of financial planning at Edelman Financial Engine. “Over time, that pressure can make people more likely to abandon the plan altogether.”
Strict budgeting is hard work, too. If you overthink every purchase, or run to your spreadsheets the moment you swipe your card, it makes sense that exhaustion will eventually set in. “This is similar to a New Year’s resolution,” Barrow tells Bustle. “If the goal is too ambitious, there is risk of giving up altogether after experiencing ‘budget fatigue.’”
You’ll know you’re being too strict if you feel constant guilt and anxiety around spending, if you overthink every single small purchase, or if you skip social plans because of the money rules you’ve created for yourself, Fyhrie says. “You might also feel frustrated or burned out, especially if your budget doesn’t properly reflect the expenses you want to prioritize.”
Setting Up A Softer Budget
To create a budget that feels doable long-term, Barrow recommends focusing on priorities over perfection. “Instead of trying to account for every dollar, make sure your budget reflects what actually matters to you,” she says. Think about what you like to spend money on — shopping, nights out, food, etc. — and then budget some of your paycheck for those things. That way, when you swipe your card, you can do so guilt-free.
Fyhrie also suggests “soft saving” as a way to work towards your long-term financial goals while leaving room for enjoyment right now. Instead of cutting out mini splurges entirely, that means allowing yourself prioritize experiences you genuinely feel are worth it. If your gym membership keeps your mental health thriving, for example, then keep it.
On TikTok, many people also love the “treat yourself tax,” which encourages you to transfer money into savings every time you shop. Did you just pick up at $50 sweater? Put $50 in savings, too. That way you get to live a little while keeping your money in mind.
“Occasional splurges are perfectly fine when they’re intentional.”
Tracking your spending is also key. Keep your Notes app on hand and write down what you buy for a few weeks. It will help you see where your money is going so you can cut back accordingly. If it looks like you’re overspending when you go out on Saturdays, you can decide to go out every other Saturday. This approach is less black and white, but still helps you save over time.
The biggest takeaway? Flexibility. “Occasional splurges are perfectly fine when they’re intentional and fit within the bigger picture of your finances,” says Barrow. “When your bills are covered, your savings goals are on track, and your priorities are accounted for, enjoying a planned treat doesn’t mean you’re being irresponsible. In fact, allowing room for those moments can help make your plan feel more realistic and rewarding, which can reinforce positive habits rather than undermine them.”
Sources:
Alison Fyhrie, financial advisor at Northwestern Mutual
Isabel Barrow, executive director of financial planning at Edelman Financial Engine
