First Person: What Is Keeping My Budget From Succeeding?

Yahoo Contributor Network

Because I am a bankruptcy paralegal, most people assume that I am an expert at creating and maintaining a household budget. However, the truth is that I had some very poor budgeting skills until I began working in the bankruptcy field. There were several budget flaws that I had on my personal budget that kept me from moving past the paycheck-to-paycheck type of budget. Once I learned how to correct these budgeting mistakes, my household finances improved and I had more money to invest, save and enjoy.

Common budget mistakes and how to correct them

  • Cutting spending in wrong places - In an attempt to save money, I slashed items in my monthly budget. However, I was cutting essentials while spending more money on non-essentials. When you are looking for items to cut from your budget, the non-essentials should be the first to go.
  • No room for impulse buys - Failing to leave some room for impulse buys can sabotage even the best budget. Everyone gives into desires every now and then but refusing to allow room in my budget for this certainty resulted in my budget not working month after month. I then became frustrated and gave up. Now I have a "miscellaneous" item built into my budget each month. Some months I use this item and other months it becomes part of my savings.
  • Convincing yourself you are too inexperienced or budges are too complicated - Just because you are not a finance major is no excuse for not creating and sticking to a budget. The mistake that some people make is thinking that budgeting is too complicated when in reality it is simple math - - net monthly income minus monthly expenses equals disposable income. Hopefully, your disposable income is positive which means you can increase contributions to retirement or savings. However, if that figure is negative you must analyze your budget for budget items that can be reduced so you have a zero or positive disposable income.
  • Being "too busy" to budget - When you take into consideration the number of online tools and mobile apps available for budgeting, finding time to budget should be much easier than when it had to be done with paper and pencil. Websites such as Mint and LearnVest have free tools to help you track your personal expenses and create budgets. Mobile apps such as iReconcile and MoneyBook are quick and easy to use so you have no excuse for not budgeting.
  • Spousal sabotage - This was one of the biggest budgeting flaws I had to deal with before I could get my personal finances on track. When I married my husband, his idea of budgeting was to use his ATM card each week until there was no more money in the account. With a joint account, this was almost impossible to control. Therefore, we opened an account just for him with a set amount each month for his "personal" expenses. The remainder of his paycheck was directly deposited into our joint account, which had no ATM or debit card access. This way I could pay the bills, balance my budget and still live in peace with my husband.

If preparing a budget and maintaining personal finances seems impossible, set small term goals to get you motivated and on the right track. Start small - - prepare a budget for one week's paycheck and then expand that to your monthly income. Once you begin budgeting, you will find it is easier to live by a budget than to live in constant fear you will run out of money by the end of each month.

*Note: This was written by a Yahoo! contributor. Do you have a personal finance story that you'd like to share? Sign up with the Yahoo! Contributor Network to start publishing your own finance articles.

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