Are you making these common budgeting mistakes?
Organizing your finances and creating a budget is tough.
It isn’t easy to create a budget that works smoothly every month, life has a habit of throwing in a few curveballs along the way.
However, there are times where we can make our own budgets more complicated and difficult, resulting in some difficult monetary decisions that cause more stress and anxiety when it comes to your finances.
You can avoid most of these difficult situations if you tackle these budgeting mistakes and try to avoid them in the future too!
- It’s Easy To Create A Budget
- Simple Tips And Ideas On How To Save Money With Amazon
- What Is Home Management And Why Is It Important
What Is Budgeting
Budgeting means giving your money a task, it has to do something for you. You need to ensure that you are allocating your money to pay bills and ideally to save.
Budgeting your money is easy, what’s tough is sticking to your budget through the hard times.
If you want more infomation on writing a budget, this article, It’s Easy To Create A Budget will help.
Budgeting Mistakes To Avoid
We all make mistakes when it comes to budgeting, things get forgotten or missed off. But the better we are at noticing these mistakes the better off we will be.
Sometimes you can make mistakes and not know it until too late, these 11 mistakes are common and you can avoid them by taking note and ensuring they don’t happen to your budget!
- Not Having A Treat: This might seem odd, but if you are too strict with your money and don’t allow for an odd treat then you can find that it becomes boring very quickly and you might be tempted to splurge, doing more damage than planning some fun money into your budget. You don’t need to put much into this category, just enough for a book or other treat once in a while.
- Peer Pressure: This is the worst, they can make you feel that you haven’t anything and can’t afford things and this can make you spend money you just don’t have, adding to your financial pressure. Just because your friends spend, money doesn’t mean you have to too, you can’t judge your finances on someone else, they might be maxed out on credit cards and other debt or they might have more income than you. It isn’t easy but keeping in control of your money when it comes to peer pressure is extremely difficult.
- Yearly Bills: If you are great at budgeting and you are keeping on top of your bills, make sure you don’t forget to put money aside for those yearly bills. Insurance is something I pay yearly, it is cheaper that way and I make sure that I save up for it each month so I have the money to pay for it when it is due. Otherwise, it would blow my budget completely.
- The unexpected: Things happen and having money for this area is key. Life happens and if you haven’t got means to pay for the unexpected it will mean either a loan or trying to find the money from somewhere else!
- Keep It Up To Date: You must keep your budget up to date if you let it slip it can quickly spiral out of control. Don’t make this budgeting mistake, keep your accounts up-to-date, even if that means checking them daily.
- Budget Monthly: No month is ever the same, this means that your budget might change each month, the only way you will know is to keep on top of the budget and to make sure you give all your money a job as soon as it hits your bank account.
- Hidden Expenses: Don’t forget those little expenses, the ones on their own you don’t always notice, but when you start to add them up over the course of the month, is a substantial amount that you might be able to put to better use. A paper in the morning or a coffee on the way to work will add up quickly unless you keep it under control.
- Record Keeping: Keeping records of the money that you spend and your budget, don’t rely on remembering things, this is where mistakes happen. Either write it down on paper or find a system that works that is electronic, it doesn’t matter as long as you are not just trying to remember everything yourself.
- Dealing With An Overspend: Spending on a splurge and not wanting to admit to it or to deal with the problem. This only makes things worse, budgets aren’t made in stone and you can move things around to make them work for you.
- Impulse Shopping: Impulse buying never ends in success, it is important that you plan everything you spend. It can save unnecessary expense as well as having an item that you don’t really need or want. If it is something that you need then look deeper into the product, to make sure you buy the right product for the right price.
- Need V’s Want: The most difficult mistake that you might make with your budget is spending money on things you want, versus what you actually need. There are things in this world I would like, but I need to make sure that I only purchase the items I need; this reduces the potential clutter and means that I am not wasting my hard-earned cash. I think this is one of the hardest lessons to learn but it is one of the most rewarding, you don’t need to fill your life with everything your heart desires as you will never be satisfied, it won’t give you fulfillment but it has the potential to make you poor and unhappy.
Tips To Avoid Common Budgeting Mistakes
Avoiding these budgeting mistakes takes time and practice as sometimes they slip into your budget without you noticing.
This is fine as long as you notice and take action.
After all, a budget is not something set in stone, it is flexible and it is going to take trial and error to get it right.
Have you read any of Dave Ramsey’s books, he talks about budgeting and how important it is, it’s a good source of information.
Taking The Time To Do It Right
If you take time with your budget, if you look after it, it will reward you, by giving your money tasks to do and to keep your financial goals in sight!
It does take time, but avoiding as many of these mistakes as possible will improve your budget and make it as strong as possible.
If you are making any budgeting mistakes, you have to stop and take back control of your budget.
Remembering that your budget is flexible, it is not something to scare you, you must tackle it and keep it under control.
However, life happens, accept it, adjust your budget and move on!