A possible sign that budgeting is working -- Americans are paying off debt. According to the Associated Press in June (for the fifth straight month, August numbers should be available soon), consumers paid down their credit cards and cut other debt as they rebuilt savings.
As you strive keep your budget, you will inevitably come across some pitfalls. Here are some tips to help you stay on track.
Allow for all categories. What is your biggest tempatation? Starbucks, the vending machine, new books, iTunes, electronics? Remember to budget for these items, either under their own category, or under a more general discretionary spending category. Also think about items like eating out, clothes, medical expenses, gifts, and general money for fun or entertainment.
Budget for holidays. December is not that far away, plan for holiday spending. Suite 101 reminds people that many forget to budget for the extra expenses surrounding the holidays. Remember to take into account holiday gifts, parties, travel and other things that come along with the holidays.
Have a support system. Pick a friend, possibly someone in better financial shape than you, and ask them for help. Having someone to help you stay on track is helpful, as they can help identify unrealistic goals, as well as help you stay focused.
Review regularly. Like a visit to the doctors, you should schedule a review of your budget health at certain intervals: monthly, quarterly, semi-yearly, or at the very least yearly. This will help to keep the budget top of mind and in shape.
Give yourself time. Financial adviser Jeff Rose on his blog advises that "When it doesn’t work after one month, don’t give up. You are normal. These things take time. Allow at least three months before your budget on paper reflects reality."
Back to top