Creating a budget is easy—there are countless handouts, spreadsheets, and apps you can use. Figuring out how to stick to a budget—not so much. Even in the best of times, staying on top of your finances is challenging. With all the stress we’re facing right now, budgeting can feel overwhelming. However, when done right, budgeting puts you in control of your money, helping you manage your debt and achieve your financial goals, no matter what you’re going through.
Here are five major setbacks people deal with when starting or sticking to a budget, and solutions you can implement to get past the obstacle.
For some, starting is the toughest part. There are dozens of budgeting tools to choose from, and figuring out which one you “should” use can leave you in a state of analysis paralysis.
You can read reviews and comparisons of budgeting tools, but the best way to start is to simply try it out and create a budget. Many apps offer free trials you can use to get a feel for the platform. And don’t feel like you need to fill everything in during the test run. Start with one or two categories to get a feel for the new system.
You also don’t necessarily need to use an app. After all, the “best” budgeting tool is the one you’re going to stick with. Some people create an envelope system and only use cash or their debit card because that’s what works for them. However, you can connect budgeting apps to bank accounts and credit cards to sync your information, and many people find apps make it easy to organize and analyze their budget.
Creating a budget means coming face-to-face with your financial situation. Listing out your income and expenses can be fun when you’ve got all the money in the world. But it’s much more difficult when you are afraid to look at how much debt you have, struggling to get by, or when your income is irregular. This is especially true if you’re ashamed of your debt.
Also, budgeting can be synonymous with limitations. You may prefer to spend money freely rather than being constrained by a set monthly or weekly budget.
Rather than focusing on what might be troubling about your finances, list the goals you want to use your money to achieve. Perhaps you’re saving for a home, building an emergency fund, or paying down student loans. Prioritize the goal, and keep it in mind as you get real about your finances.
Also, reframe the idea of a budget as a spending plan. Rather than keeping you from spending money, a budget asks you to be realistic about how much income you have and your necessary expenses. Then, you create a plan for what’s left based on your goals and what makes you happy.
If you need a helping hand, you could also sign up for a free debt and budgeting session with a nonprofit credit counselor. The certified counselor can review your finances, help you create a budget, and offer advice on how to manage debt.
Figuring out how to set a budget and stick to it can be tricky, and people often stop after a few weeks or months. However, as with getting started, the tools aren’t necessarily the core issue.
A financial health survey from LendingClub and Harris Poll found that 73% of people say they have enough time to learn about finances, and only 36% think budgeting is too much work.
One problem is that many people start by creating the budget they wish they could follow. But then, they give up after unexpected expenses throw off their budget or they realize the budgeting system is too complicated.
Rather than creating a budget, you might want to track your usual spending for a month or two to give yourself a good baseline. From there, you can review the results to see if your spending aligns with your goals. Then, realistically create and refine your budget based on these results.
For example, dining tends to be a variable expense and a source of surprise. After tracking, let’s say you discover you’ve been spending $150 a month on take out. Thinking that’s too much, you decide to set a budget of $75 for the following month. Despite every effort to stay on track, maybe you chose to spend time with your family, not cooking and cleaning up, or maybe after a long and stressful day at work, ordering out was just easier. So by the end of the month, you still spent $125.
Remember, your budget is your spending plan. Rather than judging your spending, you can now use this information to tweak your budget with intent. You may decide that there are times when spending money on dining is a worthwhile expense and choose to cut back on other expenses instead. Or, maybe you discover that to cut back on take-out, you need to start prepping meals in the morning to avoid end-of-day splurges.
It can take several rounds of analysis and refinement to create a budget that fits your lifestyle and aligns with your goals.
It seems like some people are natural born savers. They may have their own money setbacks—such as failing to invest in worthwhile purchases—but budgeting can be easier when you tend to feel good about saving. On the other hand, spenders may impulsively make purchases and have trouble with repeatedly going over their budget.
If you want to learn how to stick to a budget and save money, you may need to set aside time for self-reflection. If you didn’t clearly list your goals when you created a budget, having these front and center will be important.
You could even put a sticker on your bathroom mirror, or your cards, with a reminder of what you’re working toward. Not just how much money you need, but how you’re going to spend the money or feel in the future.
Additionally, try to figure out what triggers your impulse purchases. Often, stress and boredom can lead to overspending. Or, you may find yourself browsing and buying online as a way to put off other tasks. Building awareness around your triggers is a good first step. Then, rather than trying to stop outright, see if you can circumvent your spending habit by replacing it with something that better aligns with your goals.
Feeling like no one else budgets can actually be a two-pronged problem. First, you might assume you can spend like other people do, but you don’t observe other people budgeting. After all, when you’re out shopping you only see other people who decided to spend money, not the ones who decided to stay home. Even shopping online, some websites will tell you how many people are looking at, or recently bought, an item you’re interested in.
Somewhat related, our survey found that most people don’t talk about their finances. Younger generations are more open to money discussions, but even 18 to 34-year-olds tend to keep to themselves when it comes to discussing everyday financial decisions, bankruptcy, and credit card debt.
When you start opening up to others about money, you’ll likely discover you’re not the only one who has questions, concerns, and trouble sticking to a budget.
Having regular money dates with a partner, friend, or family member who is also budgeting can help you find solutions. However, don’t pressure others into having frequent money talks if they’re not open to it. A slight majority (56%) of our survey respondents feel that thinking or talking about finances can be mentally draining.
If you don’t have someone to discuss money with, or don’t feel comfortable sharing something so private, you could look for online communities where you can remain anonymous. The personal finance site Reddit has over 14 million members ready to ask and answer questions about finance, and there are smaller subReddits devoted to specific budgeting platforms.
Sticking to a budget can be hard for various reasons, but many of them come down to setting proper expectations and making a mindset shift to focus on long-term goals over immediate wants. These aren’t simply obstacles to overcome, but doing the work can result in significant growth.
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