A budget can be a wonderful thing. It can be a tool that helps you save money, pay off debt, and get ahead in life, but that will only happen if you’re willing to take your budget seriously. Have you been struggling to make ends meet despite having a budget in place? If that’s you, I’m here to explain to you why your budget is failing.
So you’ve created a budget, but you still find yourself struggling with your finances each month. What could possibly be wrong? While you may have set up a budget, it’s simply not working for you. Chances are it’s because you are doing something wrong. Take a look at these common reasons why your budget is failing so you can make an action plan to get your budget working for you today.
1. You Don’t Stick to a List
How often do you go shopping and end up with more items that you needed? Even if those items are on sale at a great deal, adding them to your cart can result in your budget failing. Make a list of items you need before heading to the store and make a committment to buy only what’s on the list.
2. You Don’t Hold Yourself Accountable
It’s just a cup of coffee, right? A few impulse buys won’t hurt if it’s a good sale. It’s statements like these that eat away at your budget without you realizing it. You need to make sure your budget accounts for any and ALL expenses you may have because everything adds up.
3. You’re Not Tracking Your Expenses
Are you tracking everything you spend? An estimate isn’t enough. You need to sit down at the end of the day and track your expenses to make sure you’re staying on track. For example, you might estimate that you’ve spent $800 on your groceries over the past month but see that you’ve actually spent closer to nine-hundred. That $100 can make a big difference. Find a way to accurately track those expenses and you’ll be one step closer to the road of success. My favorite method? Check out the Goodbudget App.
4. You’re Living Above Your Means
A big mistake people make when setting up a budget is to not really consider what they’re actually making each month. It’s not enough to say that you’re going to spend $800 a month on groceries and $200 a month on gas if you don’t have the money. You need to make sure your income allows for those expenses. If you don’t have the income, it’s time to sacrifice – cut off the cable and stop eating out. Once you stop living above your means you’ll see your debt go down and your savings go up.
5. You’re Not Paying Yourself
You will never stick to a budget without play money. Play money is money that you can use for whatever you want. It may be for your favorite cosmetics, a new pair of shoes, or a night out with your friends. Having a little bit of money set aside to do the things you want will help you stay disciplined to follow the rest of your budget.
Last, but not least, a budget will never be successful is you don’t take it seriously. A budget is something you need to monitor each and every day to make sure it’s working for you. Once you take it seriously, your budget will be much more successful. Knowledge is power. Once you know why your budget is failing, you can make a plan to turn things around.