Do you moan thinking about your budget?
Are you so frustrated that you want to give up?
You may think you are just awful with money or you will never get the hang of how to manage your finances, but the real problem might actually be your budget itself.
Here are three situations when it’s best to cut your budget – your current one – and come up with something that will work better for you.
3 reasons why you should say goodbye to your budget
Yes, we give you permission to cut your budget. However, that doesn’t mean you have to turn your back on budgeting. If what you did doesn’t work, there is a better way to make your money masters.
1. When your budget is too restrictive
During a Bare bones budget that only essential expenses can be taken into account in order to survive lean times, a budget that is very restrictive is not sustainable in the long run.
Instead of forcing yourself to stick to strict spending limits, forget about your current budget and give yourself a month to go easy on it Track your expenses. This gives you a more realistic idea of how much you are naturally spending.
For example, if you budget $ 300 on groceries each month when you are actually spending closer to $ 400, your budget will always feel too tight. Once you have a clearer picture of your spending, you can create a budget that you can realistically stick to.
Another way to make your budget less restrictive is to purposely leave room Fun money. If you use some expenses specifically for things that bring you enjoyment, it will be easier to follow your budget.
2. When your expenses fluctuate
Budgets shouldn’t be static. This is especially true if you have expenses that go up and down from month to month or season to season.
In midsummer and midwinter, you can likely expect higher utility bills. Likewise, you tend to expect more spending during the holiday periods or months when your family has multiple birthdays.
If you’re trying to keep a tight budget all year round, you’ll run into problems when your spending fluctuates. Instead, assume the reality that you need to create a new budget every month.
Allow time at the end of each month to account for upcoming expenses in the coming month. You may not be able to plan everything down to the last dollar, but think about the situations that could cause you to spend more or less.
A Calendar budget is a great money management system as it prompts you to write down dates, special occasions, and upcoming events that you are likely to be spending money on.
3. When you are not motivated to stick to your budget
If you’re not interested in the budgeting system you plan to use, it may be time to try something different. Fortunately, there are several budgeting methods to choose from.
As mentioned earlier, the calendar budget is a great way to keep track of spending that fluctuates from month to month. A Zero-based budgeting method is suitable for Type A personalities who want to settle every dollar and penny.
The Cash envelope method is perfect for someone who is always tempted to spend more than they budgeted for. The 50/30/20 budgeting method is suitable for someone who wants to make sure they meet their needs and attend to financial goals while leaving room for discretionary spending.
A Paycheck budget works for those who want to focus on how to use their next paycheck instead of planning a whole month at a time. People who wish their bills to be more easily spread out over the month should give it a try Half payment method.
If you’re interested in the latest technology, give one of these a try Top budgeting apps. If you prefer a pen and paper approach, you can use a Budget folder, a Bullet Journal or the Kakeibo method. Spreadsheet nerds should create one Excel budget or a Google Sheets budget.
You can also combine different aspects of budgeting methods to create your own custom budget style, such as: Kumiko Love did this when she developed the budget-by-paycheck method. You will be more motivated to stick to your budget if it is something that you have created.
Nicole Dow is a senior writer at The Penny Hoarder.
This article originally appeared on www.thepennyhoarder.com