When it comes to getting our finances in order, so many of us mean well but continue to make mistakes that will only set us back further. Maybe you work hard to get out of debt, but your month always seems to be longer than your money. Perhaps you find yourself bogged down with unnecessary late fees because you simply forget when your bills are due.
The good news is you are not alone and there are things you can do to get going on the right track. Below I have listed my five Biggest Budget Busters – things I believe to be among the top reasons why so many people lose track of where their money is going.
1) People, Places & Things
It is imperative that you become mindful of the people, places, and things that entice most individuals to overspend. I firmly believe that most people have their own personal Achilles heel when it comes misappropriating their money. Sometimes friends encourage you to spend more than you can afford, or maybe you are trying to live the lifestyle of friends that are in a different financial place. Other people it’s the mall that causes them impulsively buy items they “can’t live without” only to realize they should’ve.
It is imperative that you become mindful of the PEOPLE, PLACES, and THINGS that entice you to overspend.
2) Believing The Money Myth
The Money Myth is the idea that “I worked hard for it and I owe it to myself.” You may be inclined to take this statement as fact, but it is called the Money Myth for a reason. One of things my mentor and father shared with me growing up was that some people feel like that they owe it to themselves to spend their money anyway they choose because they worked hard for it. He said, “They’re absolutely right; it is their money and they can do whatever they want with it. But what they truly deserve is to be debt free, and what they really owe themselves is a lot of money in the bank.”
What you truly deserve is to be debt free and what you really owe yourself is a lot of money in the bank.
3) No Goals, Too Many Goals
Your goals serve as what I call “Financial Anchors.” Anchors play a very important role on ships and boats. When the wind and water causes a boat to shift, they are used to keep the boat from drifting away. We all have to be anchored to something so we do not drift away. Our goals stabilize and secure us, keeping us from moving away from the things that bring us security. On the other hand, make sure you don’t have too many goals. With too many goals it is easy to quickly drain resources trying to accomplish them all.
Your goals serve as “Financial Anchors.”
4) Too Much Outgo, Not Enough Income
Some people may fall short of bringing in enough money and need to evaluate how to do so. Do you need to go back to school or obtain a new license and certification to earn more in your industry? Are you taking advantage of the raises and bonuses available at your current job by working harder? Is it time to pick up a part time job? These are questions you must ask if you don’t bring in enough money. But also remember outstanding loans and credit card payments, too big of a house or car note, subscribing to too many services, and eating out too much will bust any budget. Eliminating debt and unnecessary expenses gives you an immediate pay raise. There will be plenty of time to treat yourself when you get your financial house in order.
Eliminating debt and unnecessary expenses gives you an immediate pay raise.
5) Lack of Oversight
Some have taken the time to create a budget, but with no oversight, find themselves in Wal-Mart several times a month spending too much money. When you set a budget, you must continually review it. Keep it stored on your smartphone, iPad and notebook. Review your bank statements, your receipts and your mobile banking app for transactions. If not, you’ll think you have more money than you actually do and won’t know until it’s too late.
When you set a budget, you must continually review it.
Some of these may seem simple and that’s because they truly are! At the end of the day, all it takes is good decision-making and self-control to get your finances back on track.