The Top 3 Reasons Why Most Budgets Fail & What You Can Do to Improve Budgeting Success
One of the most common pieces of financial advice that nearly everyone receives is that they should create and stick to a budget. While this is sound advice, it’s often easier said than done. Oftentimes, budgets are created only to be forgotten about a short time later. If you’ve ever struggled with this issue, let’s explore the top 3 reasons why most budgets fail and what you can do to improve budgeting success.
The top 3 reasons why most budgets fail:
- Not having enough time or forgetting to maintain the budget.
- A lack of document and financial organisation.
- Financial emergencies and unexpected expenses.
Now that you’re aware of a few of the reasons why budgeting often fails even if you have good intentions to maintain it, here are a few easy and simple preventative measures that you can put into place to help improve your chances of budgeting success.
- As a busy person, maintaining your budget is easy to forget, especially if it’s out of sight and out of mind. To alleviate this issue, put time into your schedule for your budget and set a reminder for it. Reminders can easily be set in your mobile phone or in many popular email programs. For some people, it’s easier to find a few minutes at the end of the day, while for others, sitting down once a week makes the most sense. Either option is fine as long as time is being made.
- If your expenses and income documents are scattered in multiple places, it’s going to take more time to maintain your budget. To become better organised, designate one place in your home or office for all financial records to be kept. If you find that you’re on the computer a lot, there are several software programs that will help you keep track of your income and expenses.
- Financial emergencies and unexpected expenses are not only one of the top reasons why people find themselves in debt, but it’s also one of the reasons for why maintaining a budget can be difficult. One unexpected expense can easily dry up income and make it impossible to pay for the items or debts listed in your budget. To address this problem, building up an emergency financial fund will allow you to tap into cash that you’ve set aside instead of depleting the money in your budget. Even if you can’t set aside a large amount of money all at once, you can budget in a certain amount of money to put back every month until you have a comfortable amount saved for those financial emergencies.
As you can see, putting preventative measures in place can help your budgeting efforts become a success in a very short period of time.