If your budget isn't working for you, you need to carefully consider a few things. Your budget may not be working for a variety of reasons, and until you figure out what they are you can't fix the problem. These simple questions can help you to address your budgeting weaknesses that stop you from managing your money effectively.
Often people sit down and arbitrarily decide which categories can be cut down when making up a budget. They may not realize at first that the numbers they have won’t work. You may need to increase certain categories (such as gas or food) and decrease the ones that are not as essential to covering your basic needs. You should make sure that you always have food to eat, a place to live and power. After that everything else is negotiable.
2. Did You Cut Out All the Fun?
If you have slashed all of your spending categories or entertainment options, you may have set yourself up for failure. Everyone needs a little bit of money to spend each month. You may have to limit it to twenty dollars a month if your budget is really tight, but that twenty dollars can help stop you from blowing a hundred at the store each weekend. This extra little bit of money can prevent you from feeling deprived, which can lead to over spending. You should also set up a category to cover irregular spending like the cost of attending a friend's wedding.
Be honest, do you just not care enough about your finances to stick to your budget? Are you focused on instant gratification? Honestly having a little fun money can help to prevent this. Additionally it may help to write down your financial goals and carry them around with you in your wallet or purse. As you pull out your cash or debit card and look at those goals, it may help remind you of the reason you have a budget. You may need to avoid the stores that you tend to splurge the most at as well.
Tracking your expenses, evaluating your spending and just balancing your checkbook take up time every day. If you hate doing this, switch to the envelope system and stop using your debit card. If it is a matter of having time to track your expenses, sitting down and working on your budget for five minutes a day can help decrease the long drawn out budgeting sessions. Additionally you may consider switching to a cash only budgeting system to cut down on the time involved.
If you are working to get out of debt, but you know it will take a year or two, then it may be difficult to stick with the plan. You can set mini milestone markers along the way. As you reach these you can reward yourself. This can be extra motivation to stick to your budget. You may reward yourself with a nice dinner out if you can avoid all fast food restaurants for a month. If you pay off a thousand dollars in debt, you may reward yourself with a video game or a new outfit. These little rewards may give you the additional motivation that you need. You need to carefully analyze your budget to make sure it is moving you towards your goals. This means looking at your spending by category, and to make sure you are in balance across your budget.
If you are not working on finances together, then you may find that your spouse is ruining the budget each month. It is important to work together to avoid money and marriage problems. You can negotiate through the categories that matter the most to each other, and find a budget that works for both of you.