Avoid These Budget Busters and Increase Your Savings
Do you know that 75% of working people have no savings and live paycheck to paycheck! Are you one of these?
With the rising cost of living, it’s becoming increasingly difficult for many people to save money and reach their financial goals. Having a budget is one of the most important steps to achieving financial freedom, but when it comes to actually sticking to a budget, it can be a different story.
It doesn't have to be that way, though. Several common budget busters can easily be avoided with simple adjustments to your spending habits. By avoiding these common budget busters and making a few changes to your finances, you can take control of your saving goals and increase the amount of money you're putting away each month.
Use these strategies to stick to your budget and achieve your financial goals:
Avoid impulse shopping
If impulse shopping is your weakness, resist the temptation.
- If you go shopping for a needed item, take a responsible friend with you to help strengthen your resolve.
- Make a list before you shop, and then buy only the items on your list.
- Leave your debit and credit cards at home and only bring enough cash to pay for the needed items.
Seek to understand what triggers your overspending behavior
For example, if you’re more tempted to abandon your budget when you've had a difficult day, only go shopping when you’re well-rested and under less stress.
- Identify specific items that are hard for you to resist and avoid them. If there is a certain store or website where you consistently go over your planned spending, find new, less tempting locations to shop.
- Get organized. Adopt a new method of organizing your important papers and receipts if "forgotten bills" seem to constantly surface and derail your spending goals. if you forget to pay a bill, you may have to pay a late fee and interest. Those extra charges can add up quickly!
Set reminders to cancel subscriptions
Set reminders to cancel memberships and other subscriptions before they auto-renew to avoid paying for services you no longer use.
Shop for better rates
Just because you're satisfied with your current service provider doesn't mean you shouldn't periodically shop for a better rate.
- Every few months, review your expenses and seek ways to reduce the amount you pay for many common services, such as your telephone bill and car insurance.
- When you contact your provider, ask if you’ll save money by bundling services or cutting back on features you seldom use. While your provider may not reduce your bill, asking doesn't hurt.
Watch for unusual spending
Periodically review your expenses and see if you can identify an area where you frequently overspend. Most of us typically overspend in a specific category.
- Challenging categories for most folks include clothing, entertainment, transportation, travel, food, and housing.
- Once you've identified a category of expenses that seems to break your budget, seek ways to make smarter, less expensive choices when you buy things in this category.
- Reducing your spending in a specific category can be very challenging. For example, if your housing costs are eating up too much of your budget, your only solution may be to move to a smaller or less expensive location.
Get professional advice
If you find that you’re frequently over budget or have difficulty meeting your financial goals, seek professional help.
- Financial Coach can offer sound advice to help you learn how to plug the holes in your budget and gain control of your finances.
- You can find lots of free and low-cost budgeting and financial planning advice online.
- Many organizations, and local chambers of commerce, offer members free or low-cost credit counselling and financial planning courses.
Becoming aware of common budget busters and selecting a strategy to deal with them can help you to stick to your budget and increase your savings.
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