Don’t blow your budget.
Crafting a budget is important — but it isn’t easy. Savvy budget-builders can’t forget to track a range of expenses, design specific money goals and prioritize savings. Consider these eight budget-busting mistakes — and how to avoid them.
Making it too rigid.
Not every month will result in identical spending. Give your budget space for fluctuating seasonal expenses, from summer vacations to winter holiday shopping. An inflexible budget is tough to stick to and can derail your plans.
Forgetting to use a system.
Whether you prefer a budgeting app, such as Mint, or the old-fashioned envelope approach, you need a system to track spending. Find what works for you and stick to it.
Making impulse purchases.
The best budget is useless if you refuse to keep with it. Tamp down on impulse shopping and the habits that lead you to do it, whether it’s a day at the mall with friends or a glass of wine and Amazon Prime.
Neglecting quarterly and semiannual bills.
Don’t forget to leave room in your spending plan for quarterly and annual bills so they don’t catch you off-guard when they’re due. Some irregular bills to consider include insurance payments, annual tax bills, medical bills for planned doctor’s visits and vehicle maintenance payments.
Forgetting savings.
Design your budget to go beyond monthly expenses. Leave room to pad your emergency fund, retirement accounts or other savings goals.
Neglecting long-term money goals.
Leave space in your budget, even if it’s only $10 a month, to fund a long-term goal, such as a summer vacation or a bedroom set. This can motivate you, making your budget easier to stick to.
Refusing to budge on fixed expenses.
Your fixed expenses, such as rent, car payments and cable bills, may seem unalterable. But they’re not. You can always rent a cheaper apartment, trade in your car for an older model and negotiate your cable to add wiggle room to your budget.
Not reviewing your budget for inaccuracies.
Don’t neglect to review your budget each month, especially at the beginning, to determine whether you forgot any regular expenses, miscalculated any regular bills or need to tweak it in any other way.
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8 Big Budgeting Blunders — and How to Fix Them originally appeared on usnews.com
