7 Budgeting Challenges: Time To Kick Your Budget’s Ass!

budgeting challenges

Budgeting is an incredibly important thing to do. However, it can also be incredibly difficult! If you’re struggling with creating and sticking to a budget, don’t give up just yet. The secret to conquering your budget is knowing what’s holding you back. 

7 budgeting challenges to overcome in 2022: 

  1. Eating Out Too Much 
  2. Doing It All In Your Head
  3. Making Impulsive Purchases
  4. Not Planning For The Unplanned
  5. Saving Aimlessly 
  6. Budgeting By Yourself 
  7. Setting Unrealistic Goals

Which of the above applies to you? Be honest! Once you overcome your budgeting challenges, you’re guaranteed to kick your budget’s ass. Let’s break down these budgeting challenges and learn how to beat them.

Budgeting Challenges

1. Eating Out Too Much

Perhaps the ultimate budgeting challenge.

We’re all guilty of this one!

Unfortunately, when you prepare your budget, one of the first areas to cut back on is eating out.

While that’s all well and good, when it comes time to actually cook a meal… you’re at a loss. That familiar sly thought creeps into your mind – “why not just order a pizza?” After all, you just had a long day of work, you deserve it. 

No. You don’t! 

Once you have a handle on your budget and made some solid ground, only then you can treat yourself to your favorite overpriced comfort foods. 

So what’s the alternative?

Learn To Cook

If you’re going to get a grasp on your budget, you’ll have to learn to cook.

Cooking doesn’t have to be a burden. In fact, it can be quite fun!

When you first start learning to cook, just don’t go for anything too fancy.

Chances are, you’re not going to be able to replicate the pasta from your favorite Italian restaurant on your first try.

One method to help you get into meal prepping is to use a meal service such as Hello Fresh. They sends you the ingredients for two to six meals a week. You can customize the meal plan to serve either two or four people. Additionally, you can customize the meal plan to fit your dietary needs and preferences.

Remember to do the math first though! It’s much cheaper to pick up the ingredients yourself. You just need to work out whether the convenience of receiving pre-built packages is worth the extra cost.

If you don’t want to pay someone else to do all the meal prep for you, you can always learn to do it yourself.

Find simple versions of your favorite recipes, and take one day a week to prep all your meals. This will make cooking during the week much easier.

Short on time? Try some simple 15-minute recipes from Busy Budgeter.

2. Doing It All In Your Head

When you think about budgeting, you probably imagine some over-the-top complicated spreadsheet.

Or worse, you try to keep track of your complex spending habits in your head.

Don’t!

Sit down with your bank statements and take careful, minimalist notes. Try simply documenting money in versus money out. Pro tip – the first number should be higher than the second. 

budgeting challenges

Being confronted with every last transaction forces you to face up to any inappropriate spending. Did you really need extra guac with your burrito? (Yes, yes I did!) 

Alternatively there are tons of budgeting apps and websites you can use to make this process simpler. Some of our 7 Best Investment Apps 2022 also do this for you!

For example, the budgeting app Every Dollar keeps track of your income, expenses, and savings. You still determine where your money should go. There’s no formula telling you what to do. If you find it important, you get to determine how much money you’ll spend or save.

Check out the following list of budgeting apps to find the right one for you and your money:

Using a budgeting app will ensure you stay within your boundaries every month. Additionally, some budgeting apps connect with your bank accounts. This shows you in real-time how much money you’re saving. Seeing how much you save in real-time isn’t just informative, it’s empowering!

One of the hardest budgeting challenges to overcome is maintaining motivation. Seeing some immediate results provides the perfect dopamine release to keep you on track. 

So what are you waiting for? 

3. Making Impulsive Purchases

Let’s be honest, spending money is fun. If you want a pair of new shoes, you get a pair of new shoes!
But the question at hand is, do you need the new pair of shoes?
Probably not.
However, one of the greatest misconceptions about budgeting is that you can’t spend money on fun things.
This simply isn’t true.
While you shouldn’t just buy things whenever you want them, you should also be allowed to live a little.
Each month, set yourself a spending limit. (You can also set a spending limit per week if this works better.) This doesn’t have to count as your entertainment or other budgeting areas. This limited amount of cash is set aside for impulse purchases. Yes, we said it. Impulse purchases *shudders*. 
The phrase “impulse purchase” doesn’t have to be a dirty word. Just limit the amount that you’re going to spend on them!
If you struggle to stick to the spending limit, there are several things you can do:
  1. Use Cash. It’s easier to spend money with a debit or credit card than it is to spend cash. Rather than setting yourself an impulse purchase limit and then carrying around the plastic card, pull the money out in cash. Keep the cash in an envelope or in your wallet. When you feel the need to make an impulse purchase, only use the money in your envelope. 
  2. Wait 24-Hours. Okay, I hear you. You want to be impulsive. NOW! However, waiting just 24-hours before making the purchase is still not a long time. It simply allows you to evaluate if you truly want the item. Not craving it the next day? You don’t need it.
  3. Talk About It. Still feel the need to overspend on impulse purchases? The problem could go deeper than motivation or habits. Consider speaking with a counselor to see if impulse purchases are a result of an emotional issue. While it may cost more initially, it will save you money in the long run!

 

4. Not Planning For The Unplanned

Expect the unexpected!
When you make your budget, you might be tempted to only focus on your current expenses. But what happens if you break a bone or have to take a week off of work for the chickenpox?
You’re going to need money to cover these unexpected expenses. So what should you do?
To plan for unexpected expenses, you’ll need an emergency fund.
This fund should only be used for… you got it… emergencies.
To start an emergency fund, set a little money aside with each paycheck. This doesn’t need to be a large amount of money. Aim to save for a one-month emergency fund within the next six months. But how much money goes into a one-month emergency fund?
The exact amount that should go into your emergency fund depends on your income and expenses. How much money do you make a month? How much do you pay in expenses every month?
Think of it like this. If you couldn’t work for the next month, how much money would you need to cover your expenses? That’s how much money should go into your emergency fund.
Once you reach your one-month emergency fund goals, start saving towards a six-month fund. Continue saving until you have a one-year emergency fund. Whenever you take money out of your emergency fund, replace it as soon as you are able.
Even if you’re working towards getting out of debt, you can still build an emergency fund. If needed, set yourself a longer deadline to build a one-month emergency fund. Instead of six months, give yourself a full year.

5. Saving Aimlessly

As mentioned earlier, motivation is one of the biggest budgeting challenges.
For many, budgeting is particularly difficult because they aren’t saving for something specifically.

Don't just set a budget, set goals!

If you’re saving for something in particular, you’ll be more motivated!
So what should you save for? If you don’t have any pressing needs or wants, find one! Plan for an exotic vacation in two years or a down payment on a nicer house. You could even save for your best friend’s birthday gift (lucky them). It doesn’t matter what savings goal you set, it just matters that you set them.
If you’re just trying to save money, it won’t bother you when you spend a little extra at times. This mentality will make it next to impossible to save up.
In other words, you’ll be motivated to stick to your budget! You can even use an emergency fund as your savings motivation.

Set A Tight Deadline!

In addition to setting a goal, you need to set a deadline.
Having a savings idea in mind is all good and well, but if you don’t have a deadline in mind, you’ll still be tempted to cheat. How long should your deadline be? Well, that depends on the amount of money you’re hoping to save.
After budgeting for present expenses, determine how much money is leftover.
If possible, put this entire amount towards the savings goal (assuming you’ve budgeted for entertainment and spending cash).
Calculate how long it would take to reach your goal, putting that much money aside each month. Don’t give yourself too much slack. Make it slightly difficult. Most people perform better under pressure!

6. Budgeting By Yourself

Budgeting can be lonely. Very lonely. 
It’s difficult to stick to a budget if you’re only accountable to yourself. If you share your expenses with anyone else, they should be involved in your budgeting journey. This person might even be interested in forming a budget of their own.
Even if you don’t have a significant other to budget with, you can ask a family member or friend to hold you accountable.
Once a month (or a week, if necessary), sit down with this family member or friend to discuss your budget. Celebrate your successes and plan to avoid any future missteps.
Whoever you choose to budget with should be supportive of your goals. Don’t choose someone who’s going to criticize you when you don’t make the right decisions.
Not sure what to talk about with your budget buddy? Luckily, Dave Ramsey has developed a Budget Meeting Guide to help you along the way.

7. Setting Unrealistic Goals/Limits

So far, we’ve talked a lot about setting and sticking with your goals.
But do you want to know the challenge that holds most people back from reaching their budgeting goals?
Most struggle to budget successfully because they set unrealistic goals for themselves. For example, it is unrealistic to save $5,000 a year on minimum wage in an apartment that charges $1,000 a month.

When you set a savings goal, it needs to be realistic.

If you set a bunch of unrealistic goals, you’ll lose your motivation to keep budgeting.
The most important part of setting a realistic goal is making sure it’s measurable.
For example, saying, “I want to save for a new car” is unmeasurable. On the other hand, saying “I want to save $10,000 to buy a new car” is measurable, kind of.
Remember, you need to set a deadline. With these parameters in mind, your new savings goal is to save $10,000 to buy a new car in 12 months. Congrats, you’ve just set yourself a savings goal.

Factor In Some Lifestyle Changes

To reach some of your goals, you may have to make lifestyle changes. For example, if you want to save enough to make a $10,000 downpayment on a house by the end of the year, you may need to find a better job and a more affordable apartment. Otherwise, you’ll need to give yourself more time to reach the savings goal.
Of course, making lifestyle changes doesn’t mean putting yourself in undesirable circumstances.
If a cheaper apartment isn’t available, cut back in other ways.
  • Cook more at home instead of eating out.
  • Only subscribe to one streaming service rather than three.
  • Additionally, you can walk more instead of driving (if you live in a place where that is possible). Not only will you save money on gas, but you’ll spend less on repairs. And you will be healthier!

Ready To Conquer Your Budgeting Challenges?

No matter what, if you defeat these seven budgeting challenges, you’re sure to have greater success with your budget.

Once you’ve jumped these hurdles, keep the momentum going! 

I strongly suggest completing a money makeover. 

Alternatively, now that you’re saving money, divert your attention to making money. 

How? Try one of our suggested side hustles or learn to invest.

Best wishes on your journey to financial independence! 

Share this Post

Share on facebook
Share on twitter
Share on pinterest
Share on linkedin
Share on whatsapp
Share on email

LET US HELP YOU REACH FINANCIAL FREEDOM

Receive your FREE Financial Independence ebook today!

Learn To Invest
Recent Posts

Take control of your financial future!

Claim your FREE Financial Independence ebook

Leave a Reply

Your email address will not be published.