Sticking to a budget is intimating for most people, but it doesn’t have to be. If you’re not accustomed to one, having a budget can seem challenging at first. Here are 8 budget challenges you might come across and how to deal with them.
1. Detailed Tracking
Many people are turned off by the amount of work that goes into keeping track of expenses. You have to record every purchase, bill or transfer. Thus, any money on its way out must be accounted for.
Tracking your budget seems laborious, but there are many helpful apps and websites available. They won’t input the numbers for you, but having a user-friendly platform where you can see and manage all your expenses will help with this budget challenge.
2. Getting Your Family On Board
Reaching an agreement is one of the biggest budget challenges. If your budget goes beyond just you, then convincing your family can be difficult. Sitting down with your partner or kids to explain why you need a budget and how the budget works will help.
Include everyone on the budgeting plan. In fact, you should craft the budget together. If your family feels like they’re part of the process, they’ll be less inclined to make risky purchases.
3. Incorrect Estimates
When you start a budget, start from scratch. It’s easy to underestimate your monthly grocery bill and allocate less than you need to this category. However, you’ll only be disappointed in yourself when you see that you’ve exceeded the amount.
Therefore, before you decide how much you’ll spend in each budget category, take a close look at how much you’re currently spending. You’ll have a realistic picture of where your money goes and find places to trim some of the fat.
4. Losing Track Of Bills And Savings
Another one of the biggest budget challenges is saving. Irregular bills can cause you to be forgetful. Remembering to set aside savings each week or month can be difficult too. However, savings are an essential part of any budget, so set up an automatic transfer after each paycheck that puts a percentage of your earnings into your savings.
You can set up a similar system with bills. Automating processes injects regularity into your budget.
Every budget should include savings to counter life’s emergencies. If you don’t have a safety net in place, then something like an emergency vet visit can throw your budget out of whack. Tackle this challenge by keeping enough savings.
6. Paying With Cash
Paying with cash instead of debit or credit cards reduces overall expenditure. Since most retailers accept cards and heading to the ATM feels like a hassle, using cash is a budget challenge for most people. Therefore, withdraw cash and use the envelope method – place enough cash inside to cover one category of your budget for a month and when it’s out, it’s out.
7. Not Wanting To Eat At Home
Eating at home is one of the most important ways to save money. This is a budget challenge, though, because many people consider cooking as a chore. Eating at home can be efficient if you start meal planning.
Once you have a plan and stick to it consistently – much like your budget – cooking at home won’t feel like such a burden.
8. Keeping The Big Picture In Mind
One of the biggest budget challenges that throws people off is fear of missing out. Friends invite you to go out and you have to decline because it’s not in the budget. Or you have to spend less on this year’s Christmas presents. This discomfort is what causes us to splurge, throwing the budget off track.
Stop yourself from splurging in two ways. Add “fun” things like eating out or seeing a movie to your budget. You can’t do “fun” things every day, but you can leave room for them occasionally. The second way to stop splurging is to keep the big picture in mind. In the midst of buying some extra treats at the store, pause to think of what your budget will look like at the end of the month if you go over.
Final Thoughts On Budget Challenges
Sticking to a budget is difficult, but not impossible. Stay motivated, stay on track and you’ll be saving money in no time.