How to Budget & Save – Top 3 Tips for Easier Budgeting
Let’s be honest — budgeting can sound kinda boring or stressful.
Especially if your version of a budget looks like:
₹10,000 for clothes
₹5,000 for food
₹20,000 for latest smartphone EMI (yup, priorities).
Well… that’s not how we’re gonna do it.
Hey everyone, If you’ve ever felt like budgeting is a chore or you just can’t seem to stick with it, you’re in the right place. In this post, I’m breaking down my top 3 tips for making budgeting simpler, smarter, and way more manageable — even if you’ve never made a budget before (or failed at a few).
I’ve been budgeting religiously for years now. I literally track every expense, every single day. It’s kind of my thing.But you don’t have to be that intense about it to get your finances in order. In fact, when I tell friends to “just track your expenses,” I can see them mentally check out.
Why?
Because not everyone is wired to log every chai, Swiggy order, or UPI split. And that’s totally okay. Some people feel a little shame about their spending (been there). Others just don’t want to know where all their money goes (also been there). Budgeting can feel like judgment — but I’m here to tell you it doesn’t have to be.
So What Is Budgeting?
Budgeting is just spending less than you make. That’s it. That’s the rule.
If you make more than you spend — congratulations, you’re budgeting well. And if you’re saving the difference? Even better.
Now, if you’re someone who doesn’t love spreadsheets or expense-tracking apps (no shame!), the rest of this blog will give you three easy-to-follow, low-stress tips for building a budget that actually works for your lifestyle.
So whether you’re trying to stop the paycheck-to-paycheck cycle, save for something big, or just figure out where the heck your money is going, you’re going to find something useful here.
Tip #1: Create a Budget That Works for You (in 3 Simple Steps)
Okay, so budgeting isn’t about cutting back and saying no to everything fun — rather it’s about understanding your money so you can actually enjoy it without guilt.
Here’s my first big tip for budgeting success, broken down into three super simple steps:
Step 1: Figure Out What You’re Actually Spending
Before you can create a budget, you have to know where your money is currently going. No assumptions — just facts.
Here’s how you do it:
- Look at your last three months of spending.
- Total it up (bank statements, UPI history, or credit card bills work fine).
- Divide by three to get your monthly average.
If that sounds like a pain, don’t worry — there are tools to make it easier! Apps like Walnut, Money Manager, or ET Money can track everything automatically. You just connect your accounts, and your spending data is ready.
Heads-up though: These apps can get a little confused if you use multiple UPI apps, different credit cards, or often pay cash. They’re helpful, but not always perfect.
Personally? I’m a bit of a nerd when it comes to tracking — I log everything in a Google Sheet manually. It’s weirdly satisfying, and I know every rupee is accounted for.
Step 2: Categorize Your Spending
Once you know what you’re spending, it’s time to sort it out into categories. This part is super helpful for identifying spending patterns.
Here are some example categories:
- Rent/EMI
- Transportation (petrol, Ola/Uber, metro)
- Utilities (electricity, water, Wi-Fi, mobile recharge)
- Subscriptions (Hotstar, Spotify, Amazon Prime, etc.)
- Groceries
- Chai/Coffee (yep, give it its own category if it’s a daily thing)
- Dining Out / Swiggy-Zomato
- Shopping
- Entertainment
- Miscellaneous (always have a catch-all bucket)
Breaking it down like this lets you see the bigger picture — and makes it easier to figure out where you might be overspending.
Step 3: Assess & Adjust
Look at your categories and ask yourself:
“Am I okay with how much I’m spending here?”
Chances are, you’ll find a few “Whoa, that’s a lot” moments.
For example, when I did this a few years back, I realized I was spending ₹8,000 to ₹10,000 a month just on food delivery and eating out. And while I kinda knew I was going out a lot, seeing the number written down made it real. It was like, “Dang, okay — maybe I should chill on the biryani.”
This is honestly one of the easiest ways to start saving a few thousand rupees a month — by identifying just one or two categories where you can cut back without sacrificing your happiness.
Even setting soft limits for yourself (like “I’ll only spend ₹5,000 this month on eating out instead of ₹8,000”) can go a long way.
Tip #2: Be Observant (a.k.a. Pay Attention to Your Money Habits)
Let’s be real — it’s way too easy to spend money without even realizing it.
Like, have you ever stepped out for a casual chai and then somehow ended the day ₹2,000 lighter because that “quick chai” turned into snacks, impulse buys at a store, and maybe an Ola ride back home?
Yeah… me too.
So my second budgeting tip is simple: just be more observant. You don’t need to overhaul your whole life — just start paying a bit more attention to how and where your money is going.
Swipe Now, Regret Later?
When you’re using UPI or a credit card, it doesn’t feel like real money. You’re just scanning or tapping — it’s all so quick and painless that your brain doesn’t even fully register that you just spent actual cash.
That disconnect is dangerous.
So here’s what I like to do: whenever I make a purchase, I write it down. It’s a simple habit, but just the act of recording what I spent makes me more conscious of my spending.
Not into writing stuff down? Totally fine. At the very least, try to mentally note your purchases throughout the day. Like:
“Okay, I just bought a ₹200 coffee. Cool, that’s fine — but I’ll skip that dessert later tonight.”
You can even reflect at the end of the day before bed. Just ask yourself,
“What did I spend money on today? And how do I feel about it?”
This kind of mindfulness might sound small, but trust me — it adds up. It builds awareness, and awareness builds better habits.
Tip #3: The 50/30/20 Rule — And Why You Might Want to Tweak It
Alright, so let’s talk about one of the most shared and simple budgeting rules out there — the 50/30/20 Rule. It was actually popularized in the West but works really well here too, with some tweaks.
So What Is It?
Here’s how it breaks down:
- 50% of your income → for needs
- 30% → for wants
- 20% → for savings
Let’s say you’re earning ₹80,000 per month (after tax). Here’s what that would look like:
- ₹40,000 goes to needs — stuff like rent, petrol, groceries, and bills.
- ₹24,000 for wants — think Zomato, Netflix, weekend trips, shopping.
- ₹16,000 into savings — whether that’s your emergency fund, investments, or even paying down debt.
Simple? Absolutely. And if you’re someone who’s never budgeted before, this is a great starting point.
But Here’s the Thing…
Life isn’t one-size-fits-all, right? So if your cost of living is lower than that 50% target for needs, why not use that leftover cash to boost your savings — instead of inflating your “wants” category?
Example:
Say you’re living in a smaller city where your rent and basic expenses only add up to ₹25,000 instead of ₹40,000. That’s ₹15,000 you’re not using in the “needs” bucket. Instead of splurging on things you don’t need (just because you can), slide that into savings.
Personally, I aim to save closer to 40% of my income when I can. It doesn’t happen every month (life happens), but when it does, it feels amazing to see that investment account grow.
Don’t Forget Your Emergency Fund!
Another little gap in the standard 50/30/20 rule is that it doesn’t really explain what you should do with that 20% savings. So here’s a quick breakdown:
- Start with your emergency fund — ideally 3–6 months of essential living expenses.
- Once that’s set, move the rest into investments — this could be index funds, mutual funds, PPF, NPS, or even FDs if you want something safe.
- If you have high-interest debt (like credit card loans), pay that down before investing aggressively.
So remember: saving is great, but saving smart is even better. You want your money to work for you — not just sit around losing value to inflation.
Bonus Tip: Review Your Budget Monthly — Stay On Track!
Alright, time for one last golden nugget before we wrap things up — and this one’s underrated but super powerful: Review your budget at the end of every month.
Why? Because budgeting isn’t about doing everything perfectly every single day. It’s about building momentum over time.
As the saying goes:
“We overestimate what we can do in a day, and underestimate what we can do in a month or a year.”
This applies perfectly to your financial goals. You’re not going to fix all your spending habits or hit your savings target in one week — but if you stick to your plan and check in regularly, you’ll be amazed at the progress a month (or three!) can bring.
My Simple Monthly Habit
At the start of every month, I do one simple thing:
I check my bank account balance and log it into a spreadsheet or note.
That’s it. Nothing fancy. Just a running list of how much money I had in my account on the 1st of each month.
Let’s say you’ve been following the 50/30/20 rule, and your savings goal is ₹16,000/month (or whatever fits your income). If your balance is increasing by that much every month — you’re winning!
And once that money is in your account? Don’t let it sit idle:
- Move some of it into a mutual fund SIP
- Or put it toward retirement (NPS, PPF)
- Or even into a dedicated savings goal (house down payment, etc.)
That way, your savings aren’t just sitting there — they’re growing and working for you.
The Bottom Line
If you spend less than you earn and save and invest the difference — you’re doing it right.
So don’t stress too much. Start simple, stay consistent, and watch your finances transform over time. You don’t have to be a spreadsheet nerd or a finance bro — just a little discipline and awareness can take you a long, long way.
FAQs on Budgeting & Saving for Indian Middle-Class Families
1. Do I really need a budget if I already save a little every month?
Yes. A budget helps you see where your money goes. Even if you’re saving ₹5,000–₹10,000 monthly, a proper budget can uncover areas where you’re overspending and help you increase your savings without cutting out all enjoyment.
2. How much should an Indian middle-class family save every month?
Ideally, try to save at least 20–30% of your take-home salary. If you earn ₹60,000 per month, that’s around ₹12,000–₹18,000. But if expenses are high (EMIs, school fees, rent), start with 10% and gradually increase.
3. What’s the best way to track expenses in India?
You can:
- Use apps like Walnut, ET Money, or Money Manager.
- Check UPI transaction history (GPay/PhonePe/Paytm).
- Or keep it simple with a Google Sheet or notebook.
The method matters less than being consistent.
4. I live paycheck-to-paycheck. How do I even start saving?
Start small. Even setting aside ₹1,000–₹2,000 per month builds the habit. Review your spending categories — usually food delivery, shopping, and subscriptions have easy room to cut. Once your income grows, increase your savings.
5. What should I do with my savings?
- First, build an emergency fund (3–6 months of expenses).
- Take health insurance & term life insurance.
- Then invest in SIPs, PPF, or NPS depending on your goals.
- If you have high-interest loans (credit cards, personal loans), clear them before investing.
6. Is the 50/30/20 rule realistic for Indian middle-class families?
It’s a good starting point, but not always realistic. In metro cities, needs (rent, EMI, school fees) can eat up 60–65% of income. Adjust it to what works for you — even a 60/20/20 or 70/20/10 split is fine as long as you’re saving something.
7. Should I stop using credit cards to save money?
Not necessarily. Credit cards can help with rewards and cashback if used wisely. The key is to pay the bill in full every month. If you carry forward balances, the interest (30–40% yearly) will wipe out your savings.
8. How often should I review my budget?
Once a month is enough. At month-end, check:
- Did I overspend in any category?
- Did my bank balance grow?
- Can I save a little more next month?
This monthly habit makes budgeting feel easy and stress-free.
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