Guest Post by Damon Dietz
It’s 9:13pm on a Tuesday evening, and I finally have some peace and quiet to myself. The kids are in bed, and I plop down on my couch to watch a new episode of Breaking Bad. Suddenly, my cell phone vibrates with an alert from my bank. Yep, it’s another alert about an insufficient funds fee. That’s the third this month. I thought to myself, “What’s the point of having a budget? It doesn’t even work.”
Fast forward a decade later, and I finally understand that is wasn’t the budget that was failing, it was me that was failing at sticking to the budget. Learning how to budget can be a tough task, and most budget fails because of three common reasons; unrealistic projections, not putting it in writing, and quitting too soon.
So many people just pull numbers out of thin air when developing a budget. “I think I spend about $300 a month on groceries,” is something I have heard often when helping single dads with their budgets. No. Just no.
Go back over the previous three months worth of bank statements and/or credit card bills and add up all your supermarket expenses. Then average those months to find out an actual depiction of what you spend monthly on groceries. You need to do this for all categories on your budget.
Some items, known as fixed expenses (rent, mortgage, car payment, etc) will not change, but you need to concern yourself with the variable expenses, the ones which will change month to month (groceries, eating out, clothes, frivolous Amazon purchases, etc.).
Once you have done this, you can set some realistic expectations on your budget.
Not Putting It In Writing
Once you have your expectations set, you should put everything in writing. A written budget will keep you on route to success and also help you to decide how and where your budget should be updated. Never underestimate the importance of declaring your goals in writing. Once you write your budget, it becomes real and more importantly, attainable.
Quitting Too Soon
I can’t tell you how many times in life I quit at things that were important to me. I quit numerous times when trying to lose weight. I quit when trying to save money. And I quit my budget many times as well.
I quit because I got discouraged, which is understandable. But, the sooner you stop quitting, the sooner you will accomplish the particular goal or task. When I finally decided to stick to my budget, no matter how discouraged I become, I eventually succeeded.
Look at it this way… let’s say you planned a family vacation to Niagra Falls. You are nearly halfway there, and you realized that you drove 20 miles off route. Do you turn around and go home? I certainly hope that’s not your first thought. Why then, after having one bad month with your budget, do you decide to throw in the towel? Stick with it. Just like anything else in life, you will get better with practice. Don’t quit. You and your budget will be better off for it.
Damon Dietz is a writer, filmmaker, and professional speaker, who shares his knowledge of finance, health, and life from the perspective of a single, divorced dad over 40. He is a father to three amazing kids and thinks dads are kick-ass, even when the rest of the world thinks we’re idiots. You can read more of his musings at: www.damondietz.com