“Been there. Done that. It didn’t work.” That’s a typical attitude among people who’ve tried to implement a money-management plan and failed. A burst of enthusiasm (usually at the first of the year) about controlling their finances disintegrates into resigned exasperation (often by March or April).
After a failed attempt, it’s difficult to summon the willpower to try again. However, if you’re serious about achieving long-term financial health and stability, there is no substitute for following a budget or a “spending plan” — call it what you like — that enables you to make the most of your money.
To increase the likelihood of success when you try again, identify what went wrong last time. Budgets typically crash and burn for one or more of the following reasons.
Unrealistic expectations.
Implementing a budget has a lot in common with getting in shape physically. You can’t decide to get in shape and then suddenly be in shape. Likewise, if you expected your budget to work smoothly within 30 days, you set the bar too high. Because of the ebb and flow of expenses, it may take several months to reach the point where all your categories are sufficiently funded and you have money in reserve.Keep in mind, too, that budgeting requires a learning curve. It takes time to get the hang of it.
No plan for unexpected expenses.
Life happens. Cars break down, refrigerators die, insurance costs rise. Although you can’t know when an unexpected expense will occur, rest assured it will occur. “Oh no!” expenditures happen to everyone.For your plan to be successful, it must anticipate those expenses. That means setting money aside for the unexpected. Failing to plan for these costs is a surefire way to throw a budget into turmoil when the “Oh no” happens.
Demoralized by a bad month.
Some months are plain awful. Your property tax comes due, you have a dental expense, and the mechanic says all four tires on your car need to be replaced. Aaargh!Giving up on your budget won’t won’t improve your financial situation. It’s likely to make it worse. Instead, you must adapt, reformulate, and press on.
Bad attitude.
Maybe you were never sold on the idea of budgeting anyway. You gave it a try because the financial experts said it’s the right thing to do. But you thought, “This is going to be terrible.” Sure enough, it was terrible.Time for an attitude check: Stop thinking of a budget as a financial straitjacket. Instead, think of it as the key that unlocks the straitjacket. A budget helps you escape financial bondage. A well-conceived and executed spending plan puts you in control of your money so that it is no longer controlling you.
Husband/wife disagreement.
If you’re married, it takes two to implement a money management plan. Regular husband/wife dust-ups about money (especially when combined with a failure to be honest with each other about spending) make it all but impossible for a budget to work.The key is to go back to the planning process. There must be agreement on the plan before there can be agreement in actual practice. A budget will not be successful if it is formulated by one person and imposed on another.
No goals.
If your spending plan isn’t helping you reach specific financial goals, it can feel like a means with no end. If you don’t have targets, you are likelier to abandon your plan when the going gets tough. So focus on particular goals: “getting out of credit card debt,” “paying off a school loan,” “saving for an anniversary vacation,” etc.Poor cash management.
For many, failing to track cash is like the small leak that sinks a big ship. The simplest method for plugging the hole is to use an “envelope system” for cash spending — i.e., putting cash in category-specific envelopes and spending from those envelopes. Getting receipts for everything purchased with cash helps too.Too much effort required.
Some people create spending plans that are so complicated that keeping up with them becomes a huge chore. The simpler a budget is, the more apt it is to be workable and help you succeed. So simplify as much as possible — with apps, envelopes, pencil-and-paper, or whatever system works best for you.Expenses too high/income too low.
Sometimes a spending plan won’t work for the obvious reason that there isn’t enough money to go around. What can you do? Shop for cheaper insurance. Scrap your subscriptions. Do whatever you can to lower expenses.On the income side, sell stuff (yard sale, eBay, Facebook Marketplace). Picking up extra income-producing work in the evenings or on weekends can provide a good short-term boost as well.
Lack of self-control.
Let’s be honest. This is probably the biggest budget-killer of all. Unless you can govern your behavior, the best budget in the world is only a theory.So, get someone to hold you accountable — not only for your spending but also for planning and tracking. If your church has a stewardship ministry, ask if there is a local “budget coach” who can help. Or search online for a coach certified by the Institute for Christian Financial Health.
Pressing on
Money management is sometimes a two-steps-forward, one-step-back process. Don’t give up. Every budgeter suffers reversals and makes mistakes. Successful budgeters keep going.
