Adulting 101: Budgeting for beginners amid inflation, when everything costs more

·5 min read

I graduated with a Master's degree and moved into my boyfriend's San Diego apartment a few months ago. We generally figured we'd save money living together, but beyond that, there wasn't a financial plan, let alone a budget.

They didn't teach budgeting in college (or high school, for that matter). The economy, however, seems to be teaching its own Master's course: sticking to a realistic budget – or any budget -– when prices keep rising.

Many others new to adulting are in the same position - experiencing the pain of gas and food price hikes while still trying to cover the rent and pay off student loans. Oh, yeah, and save for a house. Sure.

According to Student Loan Hero, 55% of the class of 2020 who received bachelor's degrees graduated with an average of $28,400 in student debt.

The average Gen Z borrower in 2020 had about $16,000 in debt while Millennial borrowers had an average of $87,000, according to

We're always looking for advice and willing to try almost anything, including old-school stuffing cash in some envelopes or saving pocket change in a jar.

“A lot of people in my generation and younger didn’t receive any education on this stuff, so a lot of people are going to Ted talks or YouTube," said Ben Markley, educator and content creator on YouTube and TikTok with the budgeting company You Need A Budget (YNAB).

So, how do you start adulting? Budgeting. Here are four expert tips to keep in mind when starting a budget.

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Evaluate your relationship with money

Understanding your relationship with money and spending is fundamental to learning to manage money, said Christian Zimmerman, co-creator of Qoins, an app-based budgeting system, and personal finance platform to educate underrepresented communities about reducing debt and achieving long-term financial goals.

“Understand your perception of money, whether it’s through your upbringing, current job, or how much you’re making versus what you’re spending,” he said.

Once you are aware of your money mindset, you can start your budget on the right track - making educated decisions about spending and saving, starting your budgeting life on the right track. Yes, budgeting is a lifelong thing.

“It’s a habit that has to continually be focused on and not a one-time thing,” he said.

How to set up a budget

Before putting the concept into motion, think about the life you want to build and what financial goals you need to make to get there. Markley said.

“Then once you have that, you’ll want to take every dollar that you have right now and start assigning those to those priorities,” he said.

Now, grab that paper. Take note of everything your money goes toward groceries, rent, and loans while remembering to include fun activities like coffee runs or date nights, Markley said.

Then, assign the dollars you already have to those priorities. It’s sobering, he said, but budgeting will give a sense of how finite money is and create a sense of what truly matters

Track your spending throughout the month, Markley said.

“Then if something changes, you would have budgeted back at the beginning of the month, you can just change your budget to reflect that.”

How to budget your money

Zimmerman said one of the biggest challenges for people starting to budget on their own is the uncertainty of what's to come. The U.S. Government assisted the pandemic with stimulus checks and a pause on federal student loan payments, but Zimmerman said to keep in mind that these are only temporary.

"We get numb to the idea that our problems are solved for us," he said. "These things (debts) aren't going to go away and they have to be solved at some point, so take action."

I always liked to think I knew how to live below my means but it really turned out that I was just finding cheaper, more unhealthy fast food and shopping at stores where I could find a top for $12 that would fall apart after one wear.

Now I try to be more conscious about where I spend my money and what I spend my money on. While it meant fewer coffee runs, I started saving for unexpected expenses that may come my way.

Zimmerman said when he graduated from college, he lived with roommates and rented his car to keep his expenses extremely low in case his business didn't succeed or he lost his job.

While those ideas may not be practical for everyone, know where you can cut costs and prepare for a financial emergency, Zimmerman advises.

"Everybody wants that nice lifestyle, but when you're first starting out, your goal should be creating that foundation," he said.

Budgeting is a journey

I started my budget when I first got to San Diego on an Excel spreadsheet. I keep track of my paychecks, bills, and how much I want to spend during that pay period. It's still a super rough draft, but, realistically, a budget won't be perfect right away.

Markley said there’s a misconception that when creating a budget, it has to be perfect from the beginning.

“You’re going to underbudget for some stuff, you’re going to forget certain things that need to be budgeted,” he said. “A really important mindset is always remembering that people don’t always stick to your budget. Make sure your budget sticks with you.”

Markley creates TikTok and YouTube budgeting videos using YNAB's four rules including giving every dollar a job and rolling with the punches.

Budgeting can feel overwhelming and while you can't control what's happening in the economy, it may help to remember that there are things you can take charge of, Markley said.

“You’re not the Federal Reserve, you’re not the stock market, but you can control what’s happening in your home,” he said. “It’s really easy to internalize the anxiety. (But) right now is a great time to just question everything.”

This article originally appeared on USA TODAY: What is budgeting? Beginners' guide, tips on how to limit spending