10 Reasons Your Budget Might Not Be Effective (YET!)

By Kate Kaden at the Kaden Kaden Channel on YouTube

Your budget isn’t written down or typed out. Mental math is not enough. You must write it out and see the numbers in front of you to be sure that you are reaching your financial goals.

You don’t know how much you actually take home. What your salary is vs. what you take home are two different things. Know the number that hits your bank account each paycheck to budget effectively.

You’re not customizing it for yourself. There are many budget methods out there including the 50/30/20, the envelope method and the zero based budget. No matter what anyone says, choose the budget that feels and works best for you and the way you think.

You don’t have a unique monthly budget. This changed the game for me. I used to budget each month identically and it did not serve me as well. Once I started planning each month for what was uniquely happening that month, I suddenly saw savings like never before.

You’re not prioritizing your savings. Keep savings at the top of your list for the things that are important to you. A budget helps you live below your means so you can keep your eyes on the prize and save for what you want most in your life.

You don’t track all of your expenses. Many struggle with this step, but it is crucial in reconciling your budget. If you make a good plan, but don’t track your money, you are possibly either leaving money on the table that can better be spent elsewhere, or you might be overspending, but not know it until it’s too late.

You disregard irregular expenses. There are some things that come up that aren’t a regular expense that we forget about. Perhaps fundraisers, school photos for your child, etc. For this, I recommend you build a budget buffer. A budget buffer is one month of expenses in your checking account at all times to catch anything that comes up in a pinch.

You don’t budget for the unexpected. Tires will blow. Dishwashers break. Medical emergencies happen. For the hard, big emergencies like job loss and medical emergencies, build up an emergency fund over time to minimize the impact of these hard times. Commit to creating a fund of 3-6 months in savings to cover any disaster or challenging period of time.

You don’t adjust your budget as the month goes on. My personal choice is not to “set it and forget it” at the start of the month. For example, I budget $100 for gas, but I only spend $80. I will promptly put that $20 into savings or wherever else that $20 can best serve my budget.

You disregard your budget that you took all that time to create. Whatever you do, don’t forget about the budget you took so much time to create. As the days go on, it’s easy to just disregard your spending and think “oh I’ll just write it down later” or “i just won’t track that, what’s the big deal?” Budgeting takes several months of repetition to become a true, effective habit. Don’t give up! You’ve got this! Stay with it! Make all your financial dreams come true.