Money Trend: Can ‘loud budgeting’ help you save big in 2024?

Dubai: Forget boring spreadsheets! The world is buzzing with a new money movement: loud budgeting. It's all about openly sharing your financial goals, ditching debt, and reaching your dream purchases faster. Join the trend and say goodbye to sneaky spending!

Paul Riley, a personal banking executive with NAB Bank in Australia, defined ‘loud budgeting’ in a recent report. "It is all about unapologetically prioritising your own financial goals, setting smart boundaries on spending, and feeling comfortable to talk about it openly," Riley wrote.

When Dubai-based financial planner Mirin Raul was asked for her thoughts on this trend, she agreed that when it comes to consistency and discipline when budgeting, with this method there is a certain level of accountability and motivation that comes from putting it out there for the world to see.

Can loud budgeting help you reach investing and savings goals faster?

“This new trend called ‘loud budgeting’ is visibly gaining traction as a no-shame approach amid today’s personal finance realities, especially for millennials and Gen Z, and it’s drawing the attention of top bankers and investors,” said Zubair Shakeel, a UAE-based wealth advisor.

“The new budgeting method is widely considered ‘part philosophy, part practicality’, and it's essentially being candid about your financial state and what you are doing to live at or beneath your income limit. Though previously known in so many terms, research has historically vouched for this."

In some ways, ‘loud budgeting’ goes hand-in-hand with a simple lifestyle, but also making more mindful purchases, explained Raul. “The loud budgeting trend regurgitates that it’s fine to have financial goals and make sacrifices to meet them,” she added.

Would you take up loud budgeting as a means to rein in your spending?

Long-time Abu Dhabi-born resident Fahed Abbas admitted how it has often become hard to budget and keep track of his finances in the past, especially on days that turn incredibly hectic for him. “But off late I’ve noticed this trend that encourages accountability, and feel there’s merit to it,” he said.

"I wanted to live below my means and considering that I’ve found it hard to be disciplined and held accountable when setting out on new financial goals alone, I’m open to experimenting with ‘loud budgeting’ because I believe it will help me reach investing and savings goals faster.

“The science is sound, and as long as you don’t publicly overshare on the state of your finances, it’s worth trying out, ” said Abbas, who is now trimming unnecessary purchases to renovate his house, also participated in a trend called the ‘no-spend January’ trend to "detox" from holiday spending.

How ‘loud budgeters’ are reining in ever increasing ‘lifestyle creep’

Multiple research have flagged that ‘lifestyle creep’, i.e. when someone increases their spending as they earn more money, is another factor weighing on savers and investors. Raul further noted that it’s been forever noticed that when you have more money, you spend more.

“I have had a number of people complain of being in a financial position of ending the month at a zero balance, even though he or she has been earning double than about four or five years ago,” she noted.

“In addition to more common saving practices like tracking your spending, making a budget, and reducing impulse spending, one new method many loud budgeters are embracing is saying ‘no’ to potential high-spending instances that come with a price.”

Key takeaways

If you feel that most traditional stringent budgeting methods have not been improving the state of your finances, experts recommend trying out this method, but both Raul and Shakeel both advise to take caution when sharing too many financial details to the public. But there is an upside to this too.

“‘Loud budgeting’ helps improve accountability, which is often a key unaddressed downside with traditional budgeting. By sharing your financial goals with friends, they will likely open up about their goals, which can lead to together deciding to limit spending," added Shakeel.

“But, like all methods, no size fits all. Instead of blindly following a trend, use it as an chance to align your spending or saving habits with your goals. Use an app or spreadsheet to write out you're goals, how much you think it’ll cost and how you plan to afford it. That way, you make informed decisions.”

Raul further added that with participating in trends online, especially with your money, comes down to what you're comfortable with. "Money is such a personal thing to us. It may trigger different types of emotions in us whether it's shame, whether it's a feeling of pride, because you've accomplished something. The most important thing is being smart about what you're consuming online."