3 Common Budgeting Mistakes and How to Avoid them

Many people feel that they are financially responsible and on top of their budget, but there are a lot of common mistakes that can occur that can send your budget awry! It doesn’t matter if you’ve been creating a personal budget for 50 years or if you’re doing one for the first time, these are three common mistakes that you’ve probably made that can be easily avoided: First, it may sound obvious but ensure that you’re creating a yearly budget before the year begins and a monthly budget before the month begins! Second, don’t forget to track your spending in order to optimize your budget going forward! Lastly, don’t be afraid to price shop and see if a better rate or deal exists!

Create your Budget Before the Month/Year Begins

This tip is one that may sound obvious, but you’d be surprised how many people set out to create a budget but do so after the budget period in question has begun! As such, you’ll want to have your ducks in a row before the budgeting period begins in order to account for any unexpected expenses! In addition, monthly budgets are a great way to keep track of special expenses, such as a summer vacation or school enrollment fees! While you may feel that you’re on top of such expenses—especially if they’re reoccurring expenses—you don’t want to be caught off guard and go over budget!

Track your Spending

This is another mistake that often occurs, and it may surprise just how common it is! Tracking your expenses is vital to understanding where you’re spending your money and where/how you can cut back on your spending! In an age of technology and online banking that keeps track of certain expenses, it can be easy to think that you no longer need to track your expenses yourself! However, a bank error or another unexpected issue can cause problems and, if you haven’t been tracking your expenses yourself, can go unnoticed! As a result, you should always track your own expenses to ensure that you stay on top of your budget!

Price Shop

Price shopping is essentially shopping around for the best price for a good/service, and you shouldn’t be afraid to take the time to price shop! Whether you’re buying a new washing machine or trying to decide on an insurance agency for your car insurance, you should always take a moment to price shop and see what sort of rates/prices are out there! Every year, countless people find that they overpaid for an item or are overpaying for a service and have thus cost themselves significant amounts of money! You may think that you don’t have time to look for a better deal, but you may regret that standing when you realize later how much more you could’ve saved!