Sticking to a written budget is much harder than it seems. It’s especially hard when it’s your first try. Even the best budgets can fail if they aren’t working properly, it’s just important to stick to it and keeping working at your budget whenever you notice that it’s no longer working!
Before we start, I just wanted to let you know that we recently created a FREE email course all about budgeting that I think you’ll love! It’s called 5 Days to a Beautiful Budget and you can subscribe to it below!
The answer to your bad budget may not even be that complicated. If you’re looking to fix a failing budget, the important first step is to figure out the reasons why you have a failing budget to begin with.
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Reasons Your Budget is Failing
#1 – Living in a Fantasy World
When you create your first budget, it’s tempting to cut a lot of costs before thinking about what it might actually do to your life. Your budget should be based on real, actual numbers. Not on some kind of unrealistic fantasy that you have for your money.
I know it sounds great to only budget $100 for groceries for an entire month, but if the previous month’s grocery bill was $500, you aren’t going to be able to cut that much that fast.
Make sure your numbers are close to real life, a budget doesn’t have to be like being in jail.
On the other hand, don’t over budget your money. You don’t want to live in a world where your total budgeted income is $5,000 but you’re only bringing home $3,000. Realistic numbers, realistic cuts.
#2 – Forgetting to Budget for Necessary Items
When creating an early draft of your budget, it’s really really easy to forget to budget for certain things. If you’ve never tracked your expenses before you probably aren’t aware of all the things you actually spend money on.
It’s important to remember some forgettable budgets items, we even wrote an entire post on the items you’re forgetting to budget for! I highly suggest that you check that out and see what things you might be forgetting to add to that good ol’ budget!
#3 – You Stopped Tracking Every Penny
One of the most important factors in having a budget that succeeds is to actually track every penny. The second you stop tracking the money you spend, the second your budget begins to fail.
Sometimes the biggest thing that messes with my budget is taking money out of an ATM because it’s so hard to figure out exactly where that money went unless I’m tracking every single penny.
Every time you make a purchase you must track it in your budget. I know a lot of people prefer to only track their expenses once or twice a month, but they end up missing items and their budget just doesn’t add up.
Eventually, tracking your expenses will just be second nature. An awesome tool you can use is everydollar.com and the zero-based budget because you can easily track every purchase you make!
#4 – You Have Too Many Unnecessary Expenses
If you have a budget, I assume you’re working towards some kind of financial goal. This means that your FIRST step should have been to eliminate unnecessary expenses, if you skipped this step, your budget is definitely going to fail.
Chances are you have some things that you’ve convinced yourself are necessary expenses (spotify, anyone?) but you’re struggling to make ends meet.
- Related Post: 10 Items You Should Stop Buying to Save Money
How to Fix A Failing Budget
#1 – Stop Using Credit
This is the first thing you need to do when your budget begins to fail. What you need to realize if you’re still using credit, is that just because you use credit, doesn’t mean you get to not track that spending! You still have to pay that money back!
A big mistakes a lot of people make is just totally not tracking their credit card charges which totally messes up their budget because it’ll trick you into thinking you can cut certain budget lines further than you already did!
For example, if you charged groceries one week out of the month, you’ll end up budgeting way less for groceries the next month and you’ll struggle to make it work but you won’t understand why.
- Related Post: Credit Card Rules You Should be Following
#2 – Figure Out Every Expense
It’s really easy to leave some of the smallest monthly expenses out of your budget, but don’t do it! You need to be tracking every single coffee, every single can of soda, and every sandwich you had to buy because you forgot your lunch.
These expenses add up very quickly. Forgetting to track these expenses even for a week can completely throw off your budget.
- Related Post: Items You’re Forgetting to Budget For
#3 – Have an Emergency Fund
Did you know that people who have an emergency fund are much more likely to survive… well, a financial emergency? Haha! I guess that’s kind of obvious because it’s emergency money.
Tons of regular people, just like you and me, don’t have any money ready in case of an emergency. What would you do tomorrow if your car broke down? Probably either put it on a credit card or cut your budget in half for next month and then suffer. Not an awesome way to live, right?
Having an emergency fund will fix your budget because it helps steer you away from financial disaster.
- Related Post: How to Create a $1000 Emergency Fund
#4 – Have a Monthly Budget Meeting
Whether you’re single or in a relationship, having at least one hour each month that’s dedicated to editing your budget is so important to making sure that you’re budget keeps on working.
I don’t know if you’ve realized, but every month is different. Some months you’re going to need more fun money, some months you’ll need to give more gifts, no two months are the same.
Taking the time to make a slightly different budget every month will definitely be helpful to avoiding huge budget failures in the future. It can be super low key, you can grab some wine, put on your comfy socks, and penguin pjs, light some candles, and get down and dirty… with your budget.
#5 – Make Sure Your S/O Is On Board
This is usually easier said than done. If you’ve been trying to budget for a while without your significant other, it’s no wonder it’s not working! If you don’t 100% have the support of your other half, your budget is going to fail every single month.
You need to sit down with your boyfriend, girlfriend, spouse, whoever, and talk to them exactly why you need a budget.
- Related Post: 5 Reasons Why You Need a Budget
If you don’t yet have a spouse, but you’re engaged or in a serious relationship, you should definitely talk to your s/o about money. Don’t let it get swept under the rug because most marriages end because of money problems. There are a ton of topics you must talk to your partner about before committing to them forever!
- Related Post: 4 Money Conversations You Must Have Before Marriage
Bonus Tip: Focus on Progress, Not Perfection
Your first budget is never going to be perfect. It’s pretty much impossible for it to work perfectly even if you’ve been doing it for years. Just focus on making small, measurable changes to your finances, and don’t worry to much about being perfect because perfect is an illusion.
Budgeting is the most important thing you can do for your money management journey and it’s so important than you manage to get your budget right as early as possible!
Have you ever had a budget failure? What did you to fix it? Let me know in the comments below!
Thanks for reading,
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