"You're a broke loser.”
These are the words I deserved in March 2024. I had just dropped out of my university degree after lasting all of six weeks, split up with my girlfriend of two years, and to top it all off, I was about three grand in debt.
Looking back, I'm still confused how I got myself into that position — avoiding it seems so simple in hindsight. But at the time it was much harder, and I put it down to one main problem: I had no idea how to use money.
At eighteen, I'd discovered the glorious (or so I thought) party lifestyle. Work and study mid-week, go out on the weekends. A cycle detrimental to my health, but also my bank account. I failed to plan my spending, and as a result found myself needing loans from friends or family who could barely afford to help me out. It was a dark period for me.
Since then, I've paid off all my debts and found myself in a much better place financially. It took a lot of learning, trial and error, and mistakes — but I've come away with a far greater understanding of how to manage money. And I want to share the most important part of that journey: learning to budget.
Breaking Down a Budget
A budget is an estimated plan of income and expenditure for a set period. We use them to track, plan, and reflect on our earning, spending, and saving habits, so we can actually manage our money instead of guessing. Some common budgeting rules:
The 50/30/20 rule — Split your pay into 50% needs, 30% wants, 20% savings.
Zero-Based Budgeting — Assign every dollar a job, so income minus expenses equals zero.
Pay Yourself First — Move a set amount to savings or investments before you pay bills or spend on anything else.
Where You Can Implement It
Start by keeping it simple. There's nothing more demoralising than failing straight away. Break your income down into categories, track your actual spending for a week or two, then start cutting back where you're overspending. If you're spending $100 a week on fast food, try bringing that down to $80 — something that takes effort but is very achievable. The feeling of having more money for other things, or for savings, can be extremely motivating.
Pick one of the three rules above and try it for the next month. Don't give up if it's challenging — sacrificing a bit now buys you a lot more freedom later.
— Nate