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Planning family budget

Fixing a Budget that Isn’t Working for You

Having a budget to manage your money is important, whether you’re paying off debt, saving for a new car, planning a vacation, or simply making sure you don’t spend more money than you have. Everyone should have a budget, regardless of their financial situation.

However, sometimes your budget just might not be working for you. If you’re having difficulty making or sticking to a budget, here are some tips that may help.

Why a Budget May Not be Working

If your budget isn’t working for you, the first thing you’ll need to do is determine why you’ve having difficulties. There are several reasons why a budget might not work. Here are a few:

  • It takes time
    • Creating a budget that works well takes time. Even if you’ve put in a lot of effort detailing your expenses, your debt, your income, etc. it still could take a while to get a clear picture of your situation.
    • You’ll need to track your spending for a while so that you’ll learn exactly how much you spend in each area. Once you have this information, you’ll need to adjust your budget to the real numbers and then make sure everything balances. You might need to do this several times before you get things right.
  • Your expenses are too high
    • If you simply can’t make your budget balance, the first thing you’ll need to do is cut your spending. Look at your budget and see where you can trim your costs. This can be tough to do, but unless you make your budget balance, it isn’t going to work for you.
  • You don’t earn enough
    • If you’ve cut your expenses as much as you can, and things still don’t balance, you might need to look into other income sources, such as a side hustle or selling some of your items to earn extra cash.
  • You’re not including everything
    • A good budget should contain all your possible expenses. If you’re leaving some out, or if you’ve forgotten some, it’s easy to overspend without knowing why.
  • You’re not tracking your spending
    • If your budget is all balanced and everything works out on paper, but it doesn’t add up in real life, it’s likely because you’re not tracking everything you spend. Whether you’re tracking using an app, a pad and paper, or a spreadsheet on your computer, try to write down what you spend shortly after you spend it. This will keep you from forgetting anything.
    • Be sure to track every purchase, no matter how small. Little expenses add up and, if you’re not tracking them, you could be spending much more than you’ve budgeted.

What You Can Do to Fix a Failing Budget

If your budget isn’t working for you, you’ll need to review it. Sit down and look at the numbers in your budget. Then look at your actual spending. If these numbers aren’t the same, you’ll either have to adjust your budget, cut your spending, or do both.

A budget isn’t a static thing. It’s something that you’ll need to frequently review. Circumstances and priorities change, and you’ll need to make sure that your budget reflects your current reality.

If the budget itself isn’t the problem, but the issue is that you’re having a tough time sticking to it, then reviewing your budget regularly might help you. Taking a look at your budget will help you remember what your goals are, and this can make it easier for you to stick with your plan.

You’ll also need to make sure that everyone in your family is on board with your budget. If they’re not, you’ll need to sit down together, discuss your priorities, and work together as a family to come up with a budget strategy that works for all of you.

It’s also critical that you include some emergency savings in your budget. Life is unpredictable and you never know what is going to come up. If you don’t have anything put aside for emergencies, a sudden expense (such as a major car repair) can seriously affect your budget and potentially put you into debt trouble. Even if you can only put aside a few dollars each month for emergencies, this is better than nothing. Slowly increase your emergency fund over time until you’ve saved up several months of expenses. This way, if something unexpected happens, it won’t ruin your budget completely and you can stay on track.