Personal budgets don’t help you save money — use this method instead

When I tell people budgeting doesn’t work, a major worry is that they won’t know what’s going on with their money if they don’t keep track of a budget. To avoid restricting your spending this way, I recommend using a money map to get a look at four key pillars before making a plan: Resources: Money, assets, assistance and credit available to spend Money, assets, assistance and credit available to spend Commitments: Bills and expenses you’ve agreed to pay each month Bills and expenses you’ve agreed to pay each month Goals: Savings and debt-payoff plans Savings and debt-payoff plans Spending: Amount available to spend on everything else 02 Recognize ALL of your resources Restricting the life you live based on income you can earn from working is impractical for most people and impossible for many. We need your help to stay independent Subscribe today to support Salon's progressive journalism That’s why I recommend considering not only your income when determining what you have available to spend, but these four types of resources: Income: Money you earn from working Assets: Non-liquid value you can tap, like property, investments and goods you can sell Community support: Non-profit or government resources, services and benefits Debt: Credit cards, lines of credit and loans Start drawing your money map by listing your available resources across these four categories. Also use this space to list contributions you’ll make toward: Rainy-day fund Investment accounts Big-spending plans such as travel or your next car Putting this all in one place, alongside the rest of your money map, helps you see how prioritizing various financial goals can impact your overall financial picture. If a financial expert’s recommended debt payoff method or aggressive retirement savings puts a strain on your monthly resources, for example, you can adjust those goals to create more room for spending and commitments.