Top Three Reasons Your Budget Isn’t Working

Regardless of how well you plan your budget, sometimes saving money isn t as easy as it should be.

Dec 27, 2012

Most people rely on a monthly budget to help them meet their savings goals, avoid overspending and pay down debt. In today’s technology era, money management plans are as simple as ever, and you may use several tools to help you stay on point, ranging from spreadsheets and spending trackers to a budget calculator. So with all the resources available to assist you, why is your budget still failing?

This is a common question many people ask themselves, and there may be a number of scenarios that result in you being stretched too thin at the end of the month or unable to meet your targeted goals. So the next time you sit down to outline your spending plan, consider whether you are making some of the most frequent blunders that threaten your budget's viability.

1. Your Budget is Too Rigid

While it’s good to know where your money is going, creating a plan that leaves no wiggle room may be counterproductive. Things may come up in a given month that you didn’t anticipate, such as a rise in food or gas prices, an overlooked birthday party you must attend or a repair. If you don’t leave any room for error in your budget, you will have no recourse for dealing with these unexpected events – other than to dip into savings or rely on credit cards.

2. You Have No Targeted Goals

A standard budget may help you curb overspending, but you may be missing out on the opportunity to optimize your money management plan. Setting goals and deadlines for meeting them can help you organize your budget around these initiatives and set benchmarks to stay on task. For example, you may decide you want to pay off your credit card bill in six months. This deadline allows you to determine how much you need to devote to payments each month to reach that goal, and organize your finances accordingly.

3. You Have a Poor Attitude About Budgeting

If you’re unable to stay within the confines of your spending plan each month, it may be all in your head. For many people, a budget can seem restrictive, which makes them all the less excited about committing to it. However, knowing how much you can and can’t spend and devoting income toward your goals is actually financially liberating because it puts you in a better future position. Changing the way you think about budgeting may help you avoid making poor financial choices that may be threatening it.

The information contained herein may not represent the views and opinions of Zions Bank or its affiliates and is intended for informational purposes.  It is presented for general informational purposes only and does not constitute tax, legal, investment or business advice.

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