Expert dives into how to rethink savings as giving yourself a monthly paycheck
Have you ever tried to budget or save but felt as though the rules were too rigid to follow? Enter “reverse budgeting,” the financial strategy where you pay yourself first and have a more flexible approach to saving.

Senior Deals Strategist Jason Higgs from Bounti breaks down details of this versatile budgeting trend and how it can accommodate your financial goals and needs.
What is Reverse Budgeting?
Reverse budgeting is a unique approach to managing money that flips traditional budgeting on its head. The idea is that with every paycheck you get, you don’t immediately think of what you need to pay for that month, such as rent bills, etc. What you do is ‘pay yourself first’ by putting a certain amount in savings. The rest of the money is then free to spend on your monthly needs, but also anything left over can be fun money, guilt free.
“This method is perfect for those who struggle with rigid budgets or want a more flexible way to manage their finances,” says Jason. “Reverse budgeting allows you to enjoy your income while still making sure you save, without feeling restricted”.
How To Reverse Budget
- Determine a monthly ‘salary’: Decide a reasonable amount to ‘pay yourself’ at the start of each month. It should leave plenty of money left in your income to comfortably pay for essential expenses, plus a little extra. “Start small, and gradually increase the amount if you’re able to,” advises Jason. “It will be like giving yourself a raise!”
2. Pay the essentials: Now it’s time for those necessary expenses. Rent, mortgage, car payment, and other bills are now the priority with whatever money is left after your self-salary.
3. Don’t stress the rest: Since you paid yourself right away, the rest of your money for the month can be allocated to what you want. This can be money for going out, shopping, or other treats. “The key is that you’ll know exactly how much fun money you have for the month after making your savings and essential payments upfront. Don’t dip into your savings to make up for any lost space here!”
Advantages of Reverse Budgeting
Reverse budgeting offers several benefits that can help you achieve financial stability without feeling restricted. One major advantage is its flexibility, allowing you to enjoy your income while ensuring you save.
“Reverse budgeting simplifies your financial planning by prioritizing savings first, which can lead to a more consistent savings habit over time,” notes Jason. “It’s also adaptable to various income levels and lifestyles, making it an inclusive method for different financial situations”.
Disadvantages of Reverse Budgeting
Despite its benefits, reverse budgeting has some drawbacks that you should be aware of. “Reverse budgeting may also lead to overspending if you’re not careful about tracking your discretionary spending,” warns Jason. “This method requires discipline to ensure that savings are prioritized and not dipped into for non-essential purchases. It might not be suitable for those who prefer a more structured and detailed budgeting plan.”