What Is Loud Budgeting?

Key points:

• What is loud budgeting? Loud budgeting is a personal finance trend encouraging openness about financial decisions. It involves transparently explaining budget-related choices, like declining plans that exceed your financial boundaries, in order to stick to your goals.

• Benefits of loud budgeting: It increases accountability by creating a support system; reduces peer pressure to overspend; strengthens relationships through honesty; fosters creative, budget-friendly alternatives; and empowers individuals to take control of their finances with confidence.

• How to practice loud budgeting: To get started, know your financial numbers, start small by discussing with close friends or family, offer budget-friendly alternatives, use “I” statements to explain decisions, and communicate with confidence without being defensive.

Have you ever let peer pressure influence how you spend your money? Maybe your family planned an amazing vacation, and you just had to go even if it wasn’t in your budget. Or maybe you couldn’t miss a night out with friends even though you were trying to set more money aside. I think we’ve all been there—whether you feel embarrassed about turning down invites, you have FOMO (a fear of missing out), or you just crave quality time with your loved ones, it’s all too easy to let others sway where your dollars go.

Is it okay to splurge every once in a while? Of course! But that doesn’t mean our budgets aren’t important. And in uncertain financial times, you might be wondering how to be more mindful of your finances and work on building your savings. One of the simplest ways to do this is through “loud budgeting.”

Loud budgeting is a relatively new term buzzing around the personal finance sphere, and it’s all about being open and honest when it comes to your financial decisions. So, let’s break down what loud budgeting means and explore how it can empower you to reach your money goals.

The loud budgeting trend

Loud budgeting is a trend that went viral on TikTok last year. The concept is simple—when you’re offered an opportunity that crosses your financial boundaries, you turn the opportunity down and honestly explain why. In short, you stick to your budget and you’re “loud” about it by transparently communicating how money plays a role in your decisions.

For example, imagine this scenario: Your friends want to have a weekend getaway that would be a blast, but it doesn’t fit your current savings plan for a new car. Instead of saying you can’t go—or worse, giving in to the pressure—with loud budgeting, you might say something like, “Right now, I’m really focused on saving for a car, so a big trip like that isn’t in my budget. Maybe we could have a day trip closer to home instead?”

Simple, yes, but definitely effective! Let’s explore how loud budgeting can benefit your wallet and your personal relationships.

Why practice loud budgeting?

You might be thinking, “Isn’t talking about money a little… awkward?” In many cultures, discussion of personal finances is a taboo topic. But breaking down those barriers can be really helpful for you and your loved ones. Here’s why embracing loud budgeting might be a game-changer for you:

• Increased accountability: When you share your financial goals with others, you create a support system. Your friends and family can help you stay on track and cheer you on as you make progress. Knowing that others are aware of your goals can be a powerful motivator.
• Reduced peer pressure: How many times have you spent money on something you didn’t want or need just so you would fit in? Loud budgeting helps combat this. By being upfront about your financial priorities, you won’t feel as pressured to overspend to keep up with others.
• Stronger relationships: Being open about your finances can actually strengthen your relationships. It fosters trust and understanding, and your loved ones will appreciate your honesty and be less likely to misinterpret your financial decisions.
• Finding creative solutions: When you communicate your budget constraints, you might be surprised by the creative and budget-friendly alternatives your friends and family come up with. Maybe you’ll host a potluck instead of going to a fancy restaurant, or maybe you’ll get out and enjoy nature instead of heading to your friend group’s usual overpriced hangout—the possibilities are endless!
• Empowerment and confidence: Taking control of your finances and communicating your decisions can be very empowering. If you change how you talk about money, you can change how you think about it, and your budget will feel less restrictive and more intentional.

How to make loud budgeting work for you

Loud budgeting isn’t complicated, but if you’ve never tried it, you may be wondering how to apply it to your life. Here are a few tips to help you turn up the volume on your budget in a positive, successful way:

• Know your numbers: Before you start talking about your budget, make sure you actually have a budget! Understand your income, expenses and financial goals. This will give you the confidence to explain your decisions clearly. New to budgeting? No worries! Check out AAA’s tips on creating a monthly budget.
• Start small: If the idea of being completely open about your finances feels daunting, start with a few close friends or family members. As you become more comfortable, you can gradually expand.
• Offer alternatives: This is key if the fear of disappointing your friends is holding you back. As we saw in the getaway example above, suggesting budget-friendly alternatives shows that you still value spending time with your loved ones, even if you have to turn some things down.
• Use “I” statements: Frame your communication around your own needs and goals. For example, “I’m prioritizing paying off my student loans right now” is better than “That’s too expensive; we shouldn’t spend that much.”
• Be confident, not defensive: You don’t need to apologize for your financial decisions. Stand firm in your choices while still being open to discussion.

Is loud budgeting right for you?

Loud budgeting isn’t a one-size-fits-all approach. If you’re someone who values privacy or has a social circle that isn’t receptive to open financial discussions, it may not be the best fit for you. But if you’re looking to reframe how you think about finance and build better saving habits, loud budgeting might be a good fit. Standing firm in your money decisions and letting your loved ones hold you accountable could make a big difference in your financial journey. You might just start a trend in your friend group and help everyone work toward their goals.

Ultimately, loud budgeting is about taking control of your financial narrative. It’s about confidently setting your priorities and living in alignment with your values.