If you're struggling to stick to a budget, try this commonly overlooked method.

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When you start saving or paying off debt you’ll run into one big mindset hurdle:

How do you organise your money so you can enjoy the now and stay excited about the future?

This constant balancing act can throw a spanner in the works when it comes to saving.

Its obvious that if you spend everything you’re earning on things you’ll enjoy right here and now that you won’t be able to build the strong, independent future you’re dreaming of. But if you save absolutely everything you have for your future goals your day to day existence can become miserable and stressful.

Its “can’t take it with you” .vs. “a penny saved is a penny earned”

Both sides have valid points and depending on our mood, we can swing between them. A sensible week of saving that we blow up by going on an expensive big night out. We can go from carefully watching our spending to an online shopping spree.

It’s just like the yo-yo dieting but with money.

So how can you find balance with your money? How can you create and maintain a lifestyle that supports and delights you whilst constantly building towards your big money goals?

One key tool that works, no matter your income level, is a fun fund.

A fun fund is amount of money you set aside for, fun! It is a set amount of money that you can spend anyway you like on anything you enjoy but once its gone, that’s it, no more luxury spends.

You could top it up weekly or monthly. You can use it to treat yourself once a week, invest in stocks and shares or save it up for a big adventure. Whatever floats your boat, as long as its fun!

How to create a fun fund:

The golden rule is that your fun fund exists completely separately to your savings and other expenses.

To calculate your fun fund:

Decide an amount of money that you can put aside weekly or monthly for fun. You calculate this amount from the amount of money you have left over AFTER you’ve covered your savings goal payments and other living expenses.

Not sure what your savings goal is? Try our free course to kickstart your saving.

Wait! I’m not sure how to set up a fun fund that works for me!

Well, you’re in luck, in our next blog we’ll be looking at how you can set up a fun fund that appeals to your unique money personality.

Want to know what your money personality is? Take the Money Personality test!