Budgeting can be such a pain, in fact, I am going to make an educated guess that if you are reading this article, you hate the “B” word just as much as the next person. It’s cool, budgeting is tough and really I do not believe anyone actually enjoys it, we just know that it is necessary.
If your budget has not been working, it could mean serious financial trouble for you or your family later down the road. I know that you do not want that and neither do I. Therefore, I am going to share with you seven reasons why your budget may not be working and what you can do to get it to work for you.
1. Allocating Too Much Money Towards One Expense and Not Enough Towards Another
This one can wreck a budget faster than you can say “don’t do it”. Let us say, for example, you put a huge amount budgeted for paying off debt this month but little to no money towards clothing. Normally, that may be fine, however, your kids start school this month and they need new clothes for the school year.
You just wrecked your budget because you forgot to account for a major expense – your kids back to school wardrobe. Make a list of all the expected expenses for the month before making out your budget in order to ensure that you have all the necessary expenses accounted for.
2. Outside Influences
I am not just talking about people influencing you to wreck your budget; I am talking about all things media related. My family has not had cable in eight years, yep we have gone almost a decade without cable and we love it. However, whenever we are hanging out at our neighbor’s house watching college football, there is the reminder of how media can wreck your budget.
You are constantly being convinced by commercials to purchase things you can probably live without. Commercials are not just at fault for convincing you to buy that super awesome mop; Facebook is to blame as well. Ads from companies, friends, and Etsy shop owners can cause you to spend money on items that were not originally planned because, well, you “need” it.
You do not, I promise, hold tight and keep accountable to your budget. If you think you are not being convinced by commercials or social media to wreck your budget, challenge yourself for a sixty-day fast. Have your cable suspended and cut yourself off from social media and see if it has an impact on your budget.
If your budget does not match your personality, your budget will fail. My family can survive without going out to eat every week, but maybe that is something your family enjoys. Therefore, if you cut it out of your budget entirely you are likely to fail because it is something that your family wants to do and it fits your family’s personality. Instead of budgeting zero for going out to eat, budget to go out to eat only once every month. That will allow your family to enjoy one of their favorite pastimes and will keep your budget in check.
4. Holding Out
If there is one thing that I hate to budget for, it is my hubs’ cigarettes. I would much rather pretend that expense does not exist every week but it does. It can also wreck our budget and wreck yours too. Maybe you or your loved ones do not have a smoking addiction but maybe there is something else that you would rather pretend did not exist – like a weekly Starbucks habit or bar tab. We all have a vice, whatever it may be, embrace it and put it in the budget. If you do not include it, you essentially have no budget.
5. Black Hole
Is there a major expense that is eating up too much of your budget? If so, you will find yourself coming up short every month and failing at saving enough money for your emergency fund. Examples of this major expense are housing payment, car payments, and excessively high expenses like a vacation home.
Look at your housing payment and figure out the math if your payment is higher than what it should be. If you always underspend on your housing, you will be able to afford a manageable life. Do not overspend on your home or car they are not worth it.
6. Covering Shortfalls
If you are consistently covering your shortfalls every month by borrowing money, you are wrecking your budget. Borrowing money can mean you are using credit cards, asking others for money, taking an advance (from paycheck or credit cards), and even using your emergency fund to cover costs that are not emergency related (hint a new washing machine is not an emergency, it is a luxury). Borrowing money is essentially, robbing Peter to pay Paul; you are taking money out of one pot and putting it into another without first thinking of how you are going to replenish that pot once it is empty. Do you and your budget a favor by being consistent in your budget, pay attention to these shortcomings and figure out how to avoid making them.
7. Lack of Discipline
Oh yes, this, discipline, can wreck your budget like a speeding train leaving nothing but chaos and confusion in its wake that you have to clean up. If you want your budget to work, you have work on your self-discipline and keep to your budget. No one else but you can make your budget better; there is no secret sauce or cure-all miracle to budgeting. It takes a lot of discipline and trial and error to make it work. Make it work.
This list is by no means exhaustive of the many different ways that you could be wrecking your budget but they are some of the more common ones. The easiest way to figure out how you may be wrecking your budget is to take an honest look at how your budget performs every month and to identify any potential budget wreckers.
What would you add to this list?
Check back tomorrow for another post in our 31 Days of Real Life on a Budget series!
JOIN THE CHALLENGE!
Money controlling you? I know the feeling. My family has been living this real life on a budget for a long time and I can tell you that there's never a perfect season, but with a few changes you can start to reign in your money issues.
Join the 5-Day Challenge today and start getting your money life in order this week!