Daily Capital

How to Use Personal Capital for Budget Goal Tracking

As a money coach, one of the first things people ask me about is budgeting strategy. There are so many different types of budgeting apps and methods out there — it can get really overwhelming.

A few years ago, after feeling exhausted by tracking my spending through countless spreadsheets, I created a budgeting method called the Three Bucket Budget.The Three Bucket Budget is a simplified system that helps track your expenses, goals, and everything else. They were crucial to being able to reach my goal to save $100K by age 25.

Want a clear view of your retirement?

The Three Bucket Budget — used alongside Personal Capital’s user dashboard — can help you gauge how you’re performing in each of the budget buckets. Here’s a breakdown of how my budgeting plan works.

Bucket One: All The Adulting Expenses You Can’t Escape From

This money is for the expenses in your life that you need to eat, live, breathe and ALL things survival. Think monthly rent, grocery expenses, utilities, and insurance payments when you’re creating your expense budget. Loan and credit card payments belong in this category too.

Bucket Two: Big Life Goals

I take my “big money” life goals very seriously. These goals range from making sure I have 3-6 months worth of expenses saved in an emergency fund, debt-pay off, and investing for retirement.

Once those initial categories are taken care of, you can start thinking about other big life goals such as how you are going to save for a downpayment for a house.

You could contribute to some of these goals by setting up automatic money transfers from your checking account into the appropriate savings accounts. I recommend using a high yield savings account or cash account like Personal Capital Cash. If your employer offers a retirement plan, it would be wise to opt in a contribution per paycheck. This not only puts the money away on autopilot but your employer may offer some sort of contribution match. Who says no to free money?

If you don’t have a retirement plan at work, there are still plenty of options, like traditional IRAs, SEP IRAs (if you’re a side hustler or self-employed), and Roth IRA’s.

Bucket Three: Fun Money

The last bucket is for fun spending — aka your Netflix subscription, dinners out, and Weird Al tickets. Spending doesn’t mean deprivation. There are certain things in life that bring us true joy and happiness. For example, I really enjoy spending money on food, travel, and nesting. So long as I’m contributing money into my other two buckets, I feel guilt-free spending on these last few items.

Have a Visual Goal and You are More Likely to Achieve It

Personal Capital is a key player in my budgeting methods. I used Personal Capital daily during my journey to save my first $100K. It kept me on track and motivated me by giving a visual representation that showed me that my goal could be a reality.

The Personal Capital dashboard makes looking at spending habits easy and intuitive. First, you link all your accounts to the tool (including any investment or retirement accounts). Then, Personal Capital scans that data and looks for patterns in your monthly cash flow.

Additionally, the Expenses Tracker feature (this can be found under the cash flow chart) is super helpful for me, especially as an entrepreneur. You can add tags to every expense that you have which makes using the Three Bucket Budget even more intuitive. Simply label your expenses by each of the bucket categories. Of course- you can be as specific as you like during your spending labeling process.

Using these methods means that you have the knowledge of how much money you’re bringing in and how much is going out — all at your fingertips.

*Personal Capital compensates Tori Dunlap (“Author”) for providing the content contained in this blog post. Additionally, in a separate referral arrangement between Author and Personal Capital Corporation (“PCC”), Author is paid $70 and $150 for each person who uses Author’s webpage (www.HerFirst100k.com) to register with Personal Capital and links at least $100,000 in investable assets to Personal Capital’s Free Financial Dashboard. As a result of these arrangements, Author may financially benefit from referring potential clients to Personal Capital and/or be incentivized to present blog content that is favorable to PCC. No fees or other amounts will be charged to investors by Author or Personal Capital as a result of the Referral Arrangement. Investors that are referred to PCC and subsequently subscribe for investment advisory services provided by PCC’s affiliated adviser, Personal Capital Advisors Corporation (“PCAC”) will not pay increased management fees or other similar compensation to Author, PCC or PCAC as a result of this arrangement. Additional information about PCAC is contained in Form ADV Part 2A available here.

The content contained in this blog post is intended for general informational purposes only and is not meant to constitute legal, tax, accounting or investment advice. You should consult a qualified legal or tax professional regarding your specific situation. Keep in mind that investing involves risk. The value of your investment will fluctuate over time and you may gain or lose money.

Any reference to the advisory services refers to Personal Capital Advisors Corporation, a subsidiary of Personal Capital. Personal Capital Advisors Corporation is an investment adviser registered with the Securities and Exchange Commission (SEC). Registration does not imply a certain level of skill or training nor does it imply endorsement by the SEC.

Tori Dunlap
Tori Dunlap is a millennial money and career expert. After saving $100,000 at age 25, Tori founded Her First $100K to fight financial inequality by giving women actionable resources to better their money. A Plutus award winner, her work has been featured on Good Morning America, New York Magazine, Forbes, CNBC, and more. An honors graduate of the University of Portland, Tori currently lives in Seattle, where she enjoys eating fried chicken, going to barre classes, and attempting to naturally work John Mulaney bits into conversation.
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