Want to Make It Easier to Stick to Your Budget? Set Up a Fun Fund

Life is fun

When you hear the word “budget” you likely think about going without. Budget is about as welcome a word as “diet” or “colonoscopy.” Budgeting sounds like you'll be forced to skimp and that can lead to budget burn-out. It's hard to stick with something that feels like a punishment, but budget setting doesn't have to be all about denial. In fact, by establishing and sticking to a budget, you actually are making your life better by relieving long-term stress. But in the short-run, it may not feel so great. To alleviate some of the pangs of budgeting, be sure to budget in money for fun. Here's how.

#1 Start with a small goal for your fun fund
Think of something that costs a few hundred dollars as your first fun fund goal. Need a new TV? You can get a decent sized flat panel for less than $500. Want summer season passes for your family to a theme or water park? Those run as cheap as $50-$100 per person depending on the park. After you accomplish this first goal, set another of the same size or maybe something a little bigger like a weekend family getaway to an affordable location.

#2 Set a longer term fun fund goal
Once you have one or two short term fun fund goals under your belt and completed, set up something more ambitious and longer term. If you have a milestone wedding anniversary coming up in a year or two, now is the time to start setting aside some money for it. Whether it's a trip to Vegas, Hawaii or just a swanky hotel nearby, figure out how much it will cost and how much you need to set aside each week and then start doing it. Choose any more significant goal that's a year or so out and get started on it.

#3 Set up a dream book and use visual cues
To make your goal seem more real and realizable, you can use visuals. Make a plan for your trip or where you'll put your new TV. Cut out photos from magazines and make a collage. Stick photos to your fridge and tuck one to put in your wallet to remind you not to spend unwisely. Put one on your bathroom mirror and in your car so that you are constantly reminded of your goal and what you're working toward. This will keep you motivated.
Also, rather than using the term “budget” which isn't very appealing, try calling it a “spending plan” or “money plan.” Once you set a fun fund goal, set up a separate bank account for it or you can direct deposit from your pay to a Bluebird card you can later use to make the purchase. Keeping funds separate will help keep you from spending it on other things and most employers will let you direct deposit to up to three accounts so you can deposit to your checking, savings and also to your fun fund.
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