Have you been thinking about creating a budget, but can’t seem to get past that thinking part? Do you still not have anything in writing? Help is here! Let’s talk about five budgeting barriers and how we can bust through them!
Budgeting Barrier 1: Excuses
Do you constantly make excuses for not creating your budget? Yes, life can happen and sometimes get in the way. However, usually it’s more about procrastination than it is about something unexpected coming up.
How to bust through: Have you heard of a money date? It’s a date you have with yourself (or with your partner) where you sit down and go over your finances. Talk about what is comfortable. Ask any questions. Increase your knowledge about money. It’s all about being open, honest, and judgment-free. Set a date for your money date. Mark it on the calendar. And do it!
Budgeting Barrier 2: Money Leaks
Do you know where your money is going? Can you account for every dollar that comes in or goes out? If you’re like most, the answer is no. We all have money drains – little pit stops here and there (gas station snacks, coffee shops, etc), little toys for the kids, a pack of M&M’s at the checkout line. These are your money leaks. And they can add up. There is a quote I heard: “How to waste $10,000 a year? Spend $27.40 a day in miscellaneous spending.”
How to bust through: A very good way to plug these leaks is to have cash. How much can you afford to spend each month on miscellaneous expenses? Whatever that dollar amount is for you, have that cash on hand. Once you have spent it, that’s it. No “refilling” it – not until the next month.
Budgeting Barrier 3: Non-existent Emergency Fund
Warren Buffet has a great quote. “If your salary is the only source of income, then you are one step away from poverty.” For some, this quote may hit very close to home. It is an absolute necessity to have 3-6 months (or more!) of expenses in your savings account. This will help you in the event of job loss or an unexpected expense that comes up.
How to bust through: Automation. Automate a portion of your money to your savings account. Keeping it automatic assures your that you are building your savings without you even thinking about it. The ultimate out-of-sight-out-of-mind. Set up the transfer to occur on your paydays or once a week – whichever you prefer. How much money do you want to see in your savings account for you to feel comfortable? Now, when do you want to see that number? For example, if I want to have $5,000 in my savings account in 12 months, I would set up an automatic transfer of $100 every week. As a bonus, I would have slightly more than my $5,000 goal!
Budgeting Barrier 4: Loads of Debt
Carrying a large amount of debt is enough to cause anyone stress, anxiety, and loss of sleep at night. It can be so overwhelming that ignoring your debt can seem like a better “in the moment” option than facing it.
How to bust through: This can happen during a money date (see above). Gather all your debts together. Get all credit card statements, loan statements, and payment statements. Yes, it will be hard to see it all in one place. If you need and would feel comfortable doing so, have a close friend or family member with you for support. Input all your debt information in a debt payoff calculator. I always recommend powerpay.org. If you want help setting up your account, please reach out to me! Also, here is a great overview video on how to use it. The great thing about this site is you can print out your spreadsheet, stick it on your refrigerator (or anywhere else you will see it), and feel accomplishment every month as you check off your debt payments. You will see exactly what month and year you can be debt-free!
Budgeting Barrier 5: Believing Budgeting is All or Nothing
This is a common mindset and leads people to believe that budgeting is a bad word. They don’t want to feel restrained in any way. I, however, beg to differ. Having a budget is freeing! You know where your money is going. You have your savings account building. And you can automate all payments. Contrary to popular belief, you do not have to budget every single area of your life.
How to bust through: Is there a particular area that you need more control over your spending? Start by budgeting that area. For example, do you spend too much on clothes? Give yourself an allotted dollar amount that you can spend on clothes every month. Have that cash on hand (see above), and when it’s gone, it’s gone. Just because you are budgeting yourself with clothing doesn’t mean that you have to budget yourself on your electric bill (for example). You do not have to cut out clothing altogether. Remember though. If you spend more on clothing, you do need to cut back somewhere else. What doesn’t give you as much joy as clothing? Cut back on that expense.
Final Thoughts
When you have these budget barriers, it can seem overwhelming to even start. However, I’m here to tell you that it can be accomplished! If you would like help, please reach out to us and schedule your free consultation call. You CAN have a more solid financial future! Start today.
