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Budgeting Mistakes

Tuesday, October 7, 2014

Last week, I talked about how I paid off my credit card debt before we got married. This week I'm going to talk about budgeting, in particular the budgeting mistakes I made.


I had tried to budget in years past, but it never worked for me. Here's why:
1. I didn't create a realistic budget. When I was in college, I started a budget and decided I should spend $40 a month on eating out. This is what I thought I should spend, but this number was not realistic at all. It's important to come up with a budget that is in keeping with your personality. If you love eating out like me, your budget needs to reflect that with a realistic amount set aside for restaurants.
2. Using a pen and paper budget didn't work for me. Most of the articles and blog posts I've read about budgeting seem to suggest writing down your budget and then tracking every single penny you spend. While I agree that it's important to track what you spend, there's no way I'm going to write down every single number by hand. That's just too time consuming. When I was working on paying off my debt, Sam introduced me to Mint.com. I LOVE it! Instead of having to write down everything I spend, Mint automatically categorizes my spending FOR ME! Occasionally they do get the categories wrong, but overall Mint has been life changing! I spend about 5 minutes looking at my budget everyday, and then I tell Sam if we're getting low in any of the categories. And that's basically it! It's super easy! The key to budgeting is figuring out what works for you. Maybe you're a pen and paper person. Or maybe you love Excel spreadsheets. Or you could use apps. If you make it simple, you'll be more likely to stick with it.
3. I didn't come up with a savings plan. In college I created a spending budget but not a savings budget. Savings should be part of your budgeting plan. Emergencies alway happen, and you'll be more prepared finanacially if you save for emergencies. For years, my dad told me how important it was to set up automatic savings. And it turns out that my dad was right. Most banks will let you automatically take money out of your paycheck and put it into savings. You never see that money in your checking account, so you never miss it!
4. My budget categories were too specific. As I said in #2, the simpler your budget, the more likely you are to stick with it. Using broad budget categories makes budgeting a lot easier. Instead of having one category for food, one category for toiletries, and one category for household expenses, my current budget combines all those categories into one. Less to think about. We also have a very broad shopping budget. This category includes everything from shoes, clothes, books, new sheets or pillows, printer ink, and decorating.

Do you have a budget? What are some mistakes you've learned from budgeting?

A Harvest of Blessing

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Linking up with: Something Fabulous Wednesday, Wow Me Wednesdays, Whimsy Wednesdays, The Wednesday Round Up, Wow Me Wednesdays (Polkadots), Whatever Goes Wednesdays, Imspire Me Wednesdays

11 Responses to “Budgeting Mistakes”

  1. These are all so true! We have such a hard time grasping exactly what we're spending our money on! I think my husband and I make it too complicated! haha

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  2. The pen and paper thing never worked for me either. I love having Mint on my phone. I have too many things to remember on a daily basis. I would much rather know that I can glance down at exactly where I am in a certain budget category whenever and wherever I need to check.

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  3. These are great tips! I'm not much of a pen and paper person either. I do love Mint.com, but haven't really used it to it's full potential yet.

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  4. Great advice! Budgets are hard. I'm gonna give mint.com a chance! xo

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  5. Thank you for sharing great budgeting tips! I'm not a pen and paper kind of girl either, I prefer an app that can do it all for me. Also I like the idea of automatically putting a part of your paycheque into savings! Sounds like a great way to avoid the temptation of spending money.

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  6. Yes! If you wait to save with the money you have "left over", you'll probably never save anything because there's rarely money left over in the budget. I think it's a good habit to pay yourself first.

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  7. I've also just heard of a new-ish budget app called LearnVest, which is also free. That one may be worth a try as well.

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  8. Me too! It's so nice to be able to check your budget while on the go!

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  9. I think making it as simple as possible makes it easier to stick with!

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  10. I love looking at the Trends tab and looking at how you sent money this month versus the last year or 6 months. It's very interesting and eye opening! I just heard of the app LearnVest, so if Mint isn't working out for you that one may be worth trying. It's also free.

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  11. I absolutely SUCK at budgeting. This probably why my husband pays all the bills :) To save money, I have my paychecks go directly into my checking account. When they get there, I transfer most to savings, only allowing my checking balance to be $100 at the most every 2 weeks. Most of the time I don't even spend half of it, but occasionally I spend every last bit. Either way, I figure I am saving money!

    Thanks for the budgeting tips! I am determined to stick to a budget one of these days :)

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