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Stop Leaking Money: How To Set Up A Personal Tech Budget

Joel Lee 08-03-2014

Technology can rob you blind. It’s expensive and it can leave you swearing to yourself that your bank balance was twice that the last time you checked it. Whether you’re buying a new phone or building a new computer, there are two ways to go about it: the responsible way and the wrong way. Don’t let technology put you in debt — or worse, on the streets.


Ready to save some money 7 Smartest Ways to Save Money Using the Internet Read More without cutting technology purchases altogether? Keep reading for tips on devising and maximizing your own personal tech budget.

Do You Need A Personal Tech Budget?


Long story short, the answer is yes.

What are some of the most common tech-related expenses for people these days? Mobile phone service, cable television, and Internet access are often in the top three. On average, those expenses come out to be somewhere around $70, $50, and $40, respectively. That’s $160 per month or $1920 per year.

That doesn’t include all the “little expenses” that people brush aside as insignificant but do actually add up to be more than you might think. Online subscriptions, premium services, web hosting, in-app purchases, gadget shopping, phone upgrades, and even extra billing for going over data caps. Throw in “big ticket” items like TVs and PCs on top of that and you might be surprised at the final tally.


Budgeting is a crucial life skill that everyone should learn. Does the word “budget” frighten you? Don’t worry. It’s not as scary as it sounds. All it means is that you set a monthly limit on how much you’re willing to spend on tech gadgets. Whether that limit is $50 or $500 is up to you and your finances, but the important thing is having a limit.

Most people don’t like budgets because they feel restrictive, but the beauty of a budget is that it can make life more enjoyable. The budget keeps you financially safe — as long as you don’t go over, you don’t have anything to worry about (save for a freak accident). Less anxiety means less stress. Less stress is always a good thing.

Create A Personal Tech Budget


All budgets begin with one question: How much money do I have?


The personal tech budget for a millionaire is going to look nothing like the personal tech budget for an independent university graduate. The more money you have, the more money you can afford to spend. So, the first step in creating a budget is to note how much income you have.

For easy math, let’s say your income is $1000 per month.

The next step is to make note of all fixed monthly expenses that you have. This includes things like rent, food, bills, insurance and loan payments, religious tithes, online subscriptions, etc. Basically, anything that is mandatory for you to pay every month should be included here. Subtract this from your income to get your recreational income (i.e., money to spend recreationally).

Let’s say your expenses are $900 per month. Subtract that from your income to get $100 recreational income per month.


The last step is to prioritize all of your recreational activities for the month and split up that recreational income across those activities. For example, you might set aside $25 for in-app purchases, $25 for tech accessories, and $50 for gadget upgrades. There’s your budget! Quick, easy, and straightforward.

A quick summary of steps for creating your own tech budget:

  1. Determine your monthly income.
  2. Subtract all of your monthly expenses.
  3. Prioritize your monthly activities and expenditures.
  4. Divide the remainder amount (“recreational income”) across your recreational activities. The amount you allot for technology is your tech budget.
  5. Done!

Making the Most of Your Tech Budget


Now that you have a budget, how do you make use of it? What should you keep in mind so that your newly created budget aids you instead of hindering you?

  • Budgets are flexible. Use the budget as a guideline, not a strict rule. If you need to shuffle around your recreational income for the month, do it. If you need to go over budget, do it but be careful. If you always go over budget, you’re only hurting yourself.
  • Review every so often. As life changes, your budget should change. When your income changes OR when your expenses change, you should review your budget and reallocate your money. Do this anywhere from once a month to once a year.
  • Save up by rolling over. If you didn’t spend all of your recreational income this month, tack it onto the next month’s budget. This is a great way to save up for big ticket purchases (TVs, computers, etc.) without spending money that you don’t have.  Impulsive shopping Buck the Trend: 5 Tips to Avoid Shopping Impulsively Online Are you an impulsive shopper? Do you throw away money on items you don’t really want or need? Here are some tips and tricks to help you regain control. Read More is the bane of all budgets.
  • Cut out luxury tech. If you’re tight on money, luxury technology should be one of the first things to go. Examples include satellite radio, addon packages for cable and Internet, annual phone upgrades, special phone accessories, next-gen computer equipment, etc. You can bring them back when your budget has room for them.
  • Don’t ignore the “little expenses”. It might seem fine to brush aside that $1 app as insignificant, but don’t be fooled. A few app purchases here and there, some $3 cables on Amazon, $5 batteries, etc. might add up to $20 per month. Even if your monthly tech budget is $200, that’s 10%!

Here are some tech expenses that you might be overlooking:

Do you control your technology, or does it control you? Have you ever given a thought to a personal technology budget? What tips do you have for us?

Image Credits: Piggy Bank Finances Via Shutterstock, Monthly Spending Plan Via Shutterstock, Pile of Cash Via Shutterstock

Related topics: Budget, Money Management, Save Money.

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  1. Cynthia Mahlin
    March 26, 2014 at 7:03 pm

    Great organizing tips.

  2. Douglas M
    March 11, 2014 at 7:33 am

    Thank you for this article. I trust we all need these tips :)