Many of us struggle with financial stress, but the answer to alleviating it could boil down to having a better handle on our money. And there's perhaps no easier way to take control of our finances than by creating a budget.

So, why do only 41% of Americans follow one? It could boil down to misconceptions about the difficulties of creating and maintaining one. In fact, 36% of Americans feel that budgeting is too much work, according to new data from LendingClub.

The reality, though, is that creating a budget doesn't have to be a cumbersome process. And once more people realize that, they'll perhaps start capitalizing on one of the most effective money-management tools out there.

Man taking notes while typing on calculator.


Creating your budget

Though putting a budget together will take some time, it's not the obtrusive task so many folks make it out to be. And once you realize how simple it is, you'll be more apt to do it, too.

To start, list your recurring monthly expenses, and then review your bank statements and credit cards bills to figure out how much each one costs you, on average. Those expenses should include things like:

  • Housing costs (rent/mortgage payment, property taxes, insurance, maintenance)
  • Transportation costs (car payments, insurance, gas, tolls, transit passes, parking fees)
  • Health insurance costs (premiums, deductibles, copays)
  • Utilities (heat, electricity, water, cable)
  • Communications (phone, internet, mobile data)
  • Food (groceries, restaurants, takeout)
  • Personal care (dry cleaning, haircuts)
  • Debt payments (credit cards, student loans)
  • Subscriptions and memberships (magazines, professional licenses, gyms)
  • Entertainment

In addition to these and whatever other monthly expenses you might incur, comb through your records and figure out if there are any yearly expenses you need to account for, like roadside assistance service or a warehouse club annual fee. Then take whatever you spend on those one-off expenses and spread that figure out across all 12 months of the year.

Gathering the aforementioned data might take a couple of hours of your time. But if your finances are stressing you out, it's certainly a worthwhile investment.

Furthermore, once you've mapped out your expenses, you should compare what you spend to what you earn and determine how much money (if any) is left over. As a general rule, you should aim to set aside 15% to 20% of your earnings (or more) for the future, so if your current spending doesn't allow for that, you'll need to cut corners. Having that budget, however, will make it easier for you to see where you're overspending and where you're stuck.

For example, if you're currently spending $300 a month on student loan payments, there might not be much wiggle room with that figure. But if you're spending $300 a month on leisure, you can cut back on movie outings and concerts to free up more cash.

Maintaining your budget

It's not unusual for expenses to change over time. Once you have your budget in place, you'll need to keep tabs on it to make sure it accurately represents your living costs. Therefore, set aside 30 minutes every few months to review your budget and make adjustments as needed. If your rent goes up $30 a month, for example, that's something you'll want to account for. At the same time, it's hardly a time-intensive process.

So there you have it: Following a budget is easy, and it's something everyone should do -- especially those of us who struggle with savings. If you've yet to create a budget, carve out a couple of hours one of these weekends to put one together. You'll be thankful you did.