It’s happening quickly. 2010 has been flying by and I can’t believe we’re in September already! I feel like I was just planning my year a month or so ago.
Like many of you, I wanted to have a budget to follow when I started this year. Buying a house motivated me to look at our spending and find ways to cut back on non essentials and focus on what we needed and some things that we wanted (like the LA trip).
I admit, we haven’t been on budget every month, but I’m glad we’ve stayed within target. None of us keeps to our budgets perfectly but some of us are sabotaging our finances by making some big budget mistakes.
Mistake #1: ” I Don’t Need a Budget”
The reasons vary. For some they’re too prideful to admit that they have a spending problem and need a budget. Others may have the mistaken belief that budgets are complicated and/or too restraining.
A budget is simply how you plan to spend your hard earned money on things you need and things you want. That’s it. A budget is supposed to help you direct your monthly cash flow to things that are important to you.
Mistake #2: “Once I Make a Budget, It’s Like That Forever”
I ‘ve talked to people about budgets and I was surprised at how many thought budgets were set in stone. You’re in control of your budget, so if it needs to be adjusted for emergencies or big life events, then do it.
The best budgets, in fact, take into account life’s surprises and will include it.
Mistake #3: “I Don’t Check to See if I Kept my Budget”
The best thing you can do is to have reminders and progress updates. I use Mint and one thing that I absolutely love about it is the weekly updates I receive. Every Friday, i get to see if I’m staying on target with my monthly budget. No guessing and if I’m spending a bit much, I know quickly. That allows me to cut back on a few things to get me back on target.
Mistake #4: ” I Can’t Do Anything Fun if I’m on a Budget”
Your budget is for your life; plan accordingly. If you like taking vacations every year than set up a goal. Save bit by bit every month. Not only will you still have your vacation, but when you get back, you won’t be in debt.
Mint has another wonderful feature that allows you to track things like vacations, emergency funds, and car funds. You’ll receive updates automatically which can be very motivating.
Your Take on Staying on a Budget
I shared common budget mistakes I’ve made or friends of mine have made. I’d love to hear your thoughts.
Have you ever made any of these budgeting mistakes? If you fixed them, how did you do it? What common budget pitfalls have you noticed.