So you’ve made a budget and you feel confident about it. But after your first month or two of trying to follow your budget, you realize that the money isn’t going quite as far as you expected. Avoid these seven common budgeting errors!
1. Not giving yourself enough flex room
Being too rigid in your budget can make it impossible for you to stick to it. You need to include fun money and a little wiggle room in your budget if it’s going to work long-term.
2. Saving too little
Saving should be your short-term and your long-term goal. Saving too little can leave you unable to deal with life’s emergencies or major expenses. Set a savings goal and figure out how you can get there.
3. Forgetting non-monthly bills
Expenses like car registration, school fees, and discount club memberships only come along once a year. Yet, if you forget to budget for them, you could be hurting when these bills roll around. Account for them in your budget.
4. Being too general in your budget
If you have a huge portion of your budget dedicated to bills and another chunk set aside for fun, you probably don’t know what you should be spending and what you are spending. Be specific about your bills.
5. Being too specific in your budget
At the same time, being too specific doesn’t give you any flexibility. Don’t break your grocery budget up into different aisles and types of food—just a general grocery budget will be enough.
Also, make Sure to grab the FREE online Budgeting Tools at Learnvest:
6. Not tracking your spending
Creating your budget is only part of the work. You have to track where your money is going for it to work. Saving receipts and balancing your checkbook can help you figure out where your budget needs fixing and where it works.
Also read: How to Build an Emergency Fund Quickly
7. Not budgeting for auto-pay expenses
Little expenses probably come out of your account automatically—gym memberships, web hosting, discount cards, and other little fees. You must plan for these expenses if your budget is going to function.
What budgeting mistakes have you made in the past (or might be making now). What did you do to fix them?
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