How to Eliminate 3 Common Budget Elimination Habits
Avoiding these pitfalls is essential to ensure that your budget is respected.
I have a confession: I hate budgeting.
Back in my youth, I stored as many of my paychecks as possible in my savings account. This way I didn’t have to worry about where my money was going or how much I could afford to spend on what I wanted.
But move quickly to a husband, a mortgage, three dogs, and a baby, and this strategy no longer solves the problem.
So whether I like it or not, I had to learn how to budget. In doing so, I really focused on how to get this budget respected. And since I’m not the only one struggling with this, I’ve put together this quick guide to beating the biggest killers on a budget. Hope this helps all budget detractors.
Here are the three common habits that cut the budget and how you can overcome them.
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1. Don’t track your spending
Probably the worst part of budgeting is the maintenance involved. Deciding how much you’re going to spend on certain things only takes a little time. But depending on your budgeting method, then you need to track where every penny goes to make sure you’re sticking to it. Fortunately, we live in a digital world.
Nowadays there are many budgeting apps available. Many of them connect to your credit cards and bank accounts to automatically extract transaction data. Some also let you set up automatic savings transfers and even give you alerts if you overspend in a certain category.
If you still forget to keep track of your handwritten budget or budget spreadsheet, I highly recommend switching to a budgeting app as it streamlines the whole process. But as with any business that you share your financial information with, do your research first. Make sure it is a legitimate business and not a scammer trying to gain access to your bank accounts.
2. Rebel Against Your Budget
Overly restrictive budgets can easily lead to anti-budget frenzy. You’re so tired of focusing on bills, debts, and savings that you can’t take them anymore. When this happens, you may decide to have some really expensive fun. And then once you get that out of your system, you need to figure out how to save your ragged budget and move on.
Stop torturing yourself. Budgets should have room for fun. Without it, they might not work. So after determining how much you need to set aside for bills, decide how you want to allocate the rest between savings and discretionary spending. If you can afford to do this, you should aim for at least 20% of the amount left to save.
Of course, this raises the question of what to do if you run out of wiggle room in your budget after paying your bills. There is no easy answer to this question. You may need to consider making bigger lifestyle changes, like downsizing your home or canceling services you rarely use. You can also look into programs designed to reduce some of your essential costs, such as SNAP benefits for groceries. Once you’ve cut your budget as much as you can, review it and see if you can’t find some room to have fun.
3. Give up because you don’t see the progress you want
One of the main reasons for budgeting is to help you reach your long-term goals, such as getting out of credit card debt, saving for a new home, or saving for retirement. A budget can help you decide how much to spend on each goal each month as well as a realistic timeframe for completion. But if that progress seems slow, or if you find that you are struggling to stay within your budget, it can put you off sticking to it.
There are budgeting apps that can help you track the progress of your savings goals. This is useful if you need that extra reinforcement to know you are making progress. You can also design rewards for yourself after reaching certain savings milestones, such as being 25% of the way to your goal. It can be an extra dessert or an extra $ 50 to spend at your favorite store – whatever is convenient for you.
If you’re struggling to stay on budget despite your best efforts, you may need to re-evaluate. Maybe you are spending too much on food because you don’t have enough budget for it the first time. After a few months with your budget, you should have a better idea of whether or not the amounts you have allocated for each category are real. Then you can make the necessary adjustments.
I’m not saying budgeting will ever be your favorite activity. But if you can avoid the three pitfalls listed above, sticking to your budget could be relatively painless. Once you get into a routine, you shouldn’t have to pay too much attention to it unless you’re facing a major life change or a big expense ahead. Then, with a positive budget experience under your belt, creating a new one won’t feel so overwhelming.