Budgets fail for a multitude of reasons. Maybe you’re not hitting your savings goal, or falling short on debt repayment. Perhaps you’ve been trying to budget for a while and realize that you’re constantly short at the end of the month and paycheck-to-paycheck just isn’t cutting it anymore. Regardless of why your budget is failing, it’s time for a change. Here’s our tips on how to make effective changes to make it through the month and set money aside for life’s curve balls!
Not many people enjoy the idea of sitting down and budgeting. But ignoring the process won’t get you out of the hole. Set aside time weekly. Schedule it in. Figure out what tools you want to use to budget. Whether it’s an app or an Excel spread sheet, or a good old notebook and paper, dedicate time and space to start working out what’s gone wrong so you can get back on track.
If your budget goals are unrealistic, you won’t be able to stick to it and you won’t get ahead. Reassess everything. Get back to basics and spend a month tracking your spending habits, bills, everything. Figure out where you’re falling short and sit with it for a minute. It’s a good idea to keep up this habit monthly, as money won’t go unaccounted for and you’ll be more aware of where it’s going and how much you actually have.
- Redefine Your Needs and Wants
If your needs are met, shift your ideas about what you want. If the money you’ve allotted to savings is being spent on take-out instead, determine if you need to reduce your savings goal or if you would rather reduce the frequency you pick up dinner on the way home. Readjust accordingly. There’s no shame in wanting to indulge, as long as your needs are covered. Make savings a need rather than a want.
- Live Within Your Means
If you’re putting yourself into debt each month to keep up with The Jones’, it’s time to stop hanging out with The Jones’. Cut back and live below your means to ensure you’re able meet your goals. A little sacrifice now may save you the risk of bankruptcy when something unexpected pops up in life.
- Change With The Times
If a household member has lost hours or lost a job entirely, or gained hours or a new job, you need to rework your budget. When gas and food prices fluctuate, you need to be aware of it and adjust the budget accordingly. If you’re working from home full time now, budget up the money you’re saving now that you’ve no longer got an hour-long commute. Make room for these changes and keep up on what’s going on in the world so you don’t find yourself slack-jawed with sticker shock.
A failing budget isn’t the end of the world as long as you don’t ignore it. Make changes, try out the new budget and review it at the end of the month to make sure the changes are working for you. If not, go through the process again. You’ll figure out what works and what doesn’t for your circumstances and you’ll feel less stressed out by being proactive about it!