We all start out at the beginning of a month with the same intentions – to stay within our budget. While week one, we feel motivated... week two things start to fall apart. Before you know what happened, a few things have set you back which leaves you feeling like you need to eat pasta with butter & peas for the remainder of the month. Your frustration towards your lack of will-power grows, and you start to doubt your ability to manage your money. Sound familiar? Here are the 3 biggest budget killers, so you’re aware of them and can avoid them as much as possible.
I have been guilty of this way too many times. An easy example is buying coffee every day. I always seem to want to buy a coffee in the morning on the way to work. Before I had a budget, I used to go to Starbucks every single day. In fact, sometimes I used to go twice – once in the morning and again in the afternoon. Now when I do buy coffee out, it’s usually at McDonald’s, unless I feel like splurging at Starbucks. While I don’t actually believe that buying a coffee every morning will derail your retirement savings or anything like that, I think the repetitive behaviour should be analyzed. When you do something so often just for the sake of doing it, is it really giving you pleasure every single time? I quickly learned that it wasn’t buying coffee that I loved, it was drinking coffee every morning. So, I try to balance my budget by bringing coffee to work a few days a week and also buying coffee a few days a week.
Apply this thinking to more expensive habits, such as constantly dining out or buying take-out. Yes, there’s often a social component to eating out at restaurants, but if you do it so often, it kind of loses its value. Some people eat out or get take-out so often that it becomes the norm for them, rather than a luxury. Again, I’m not saying eliminating these things are necessary to stay within your budget, but I think being more purposeful with your money will increase your chances to stay within your budget.
Your Budget is Too Lean
If you find that you don’t ever seem to stay within your budget, you probably don’t have a realistic budget. A budget isn’t supposed to be restrictive. A budget is supposed to be a framework for your choices. It allows you to say, “Yes, I will treat myself to these pair of jeans today, but I’ll wait until next month to buy that blouse.” It’s all about give and take. If you cut too much out of your budget, you’re just going to feel stifled and miserable. You have to ensure you have enough money to cover your fixed expenses and then a reasonable amount for your variable expenses. You need to incorporate some “fun” funds, but within reason. A good budget covers all the bases and then gives you some room to treat yourself.
Finally, nothing can kill a budget like invitations from your friends, family or co-workers to go out and do fun stuff that costs money. If you live in an urban city like I do, there is always something going on. Question: Do you know how many musicians tour through Toronto? Answer: All of them. Not to mention there’s food festivals, holiday markets, various community events etc. Every month we’re celebrating something over here. And trust me, it can get expensive. It’s difficult too, because every time you say no to expensive outings, you are also saying no to spending quality time with your loved ones. I’m going to be honest, saying no sometimes is difficult and you feel like you’re missing out. But at the end of the month, seeing that you stayed within your budget and didn’t have to borrow money from your savings feels like gold.
As an aside, also never be afraid to offer alternative plans that are more affordable for you. I personally enjoy hosting friends, in which I offer to cook a meal and they can bring wine or snacks. Even watching movies at home with them have been just as entertaining, with little to no cost.
In the end, your budget is all about balance. You have to realize that you may have to say no to some things now, in order to get a “heck yes” later. Staying within your budget is crucial to meeting your future goals. Stay intentional and determined, and you got this.