7 Horrible Mistakes You’re Making with Your Budget (and How to Fix It) - Savvy Savers Academy

7 Horrible Mistakes You’re Making with Your Budget (and How to Fix It)


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This isn’t going to be pretty.

You’re likely reading this because your budget's a mess (if you even have one).

Maybe you’re to the point of pulling your hair out. Nothing’s been working.

The good news is, there’s a way to fix it.

Even if you’re in a money mess, we’re going to work it out. I’ll pinpoint key areas where most people struggle and work through practical solutions with you. I'll help you budget your money by showing you how to change some of your habits. When you change your habits your money will follow your lead.

It’s time for me to take off the nice-guy gloves and slap down a little tough love.


You might not like what I have to say, but don’t take it personally. I want to see you succeed! I want you to hit your financial goals and live your dream life where money is a non-issue.

One of my favorite sayings is,

“If you keep doing what you’re doing, you’re going to keep getting what you’ve been getting.”

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If you really want things to be different in your financial world, you need to take a good look at what’s broken and quit repeating the same broken process.

Let's get started.

Help for budgeting money. Change your habits and your money will follow your lead.

It's All in Your Head

Money problems start with thinking problems.

You think you have enough in your bank account to cover your bills.

You think you deserve to have the latest model cell phone that costs $600 more than you can afford because even your 10-year-old neighbor has one.

You think paying with a credit card is okay because you think you can afford the smaller payments and you think the rewards are worth it.

You think someday things will get better when that next “thing” happens; like your next pay raise or the tax return you think you’ll get.

If any of these are true for you, you need to change your thinking.

Why it’s a problem:

Your thoughts dictate your actions. What you value most is reflected in how you spend your money.

In other words, money behaves exactly the way you tell it to behave. If you don’t tell it what to do or where to go, it gets out of control very quickly.

How to fix it: 

First, you need to realize that you deserve better. You do deserve the kind of life you’d like to live, but no one is going to hand it to you. It takes work and planning.

  • Decide that you are going to be in control of your money, not the other way around.
  • Think first about what your money needs to do for you. Needs first, wants later.
  • Shift your focus by setting financial goals that you want to achieve. Create a plan for your goals. Try this Free Printable to get you started.

Recommended Reading

Want to know the difference between super successful people and the average Joe who can never seem to get ahead? Your mind is an amazing thing. Napoleon Hill visited and interviewed dozens of millionaires to find out what made them so successful and put the findings of his research into this inspiring little book.

You Believe Budgets Are Restrictive

Budgets get a bad rap.

The word “budget” almost makes it into the naughty four-letter-word category.

A frequent problem I hear from budget-haters (or even those who only use a budget as a guideline) is they are thinking of all the things they can’t do if they create a budget.

  • I don’t have flexibility, budgets are rigid.
  • I can’t go out to eat or spend on other entertainment.
  • I can’t fit everything into a budget.
  • I can’t budget by the month, I need to do it weekly. (So you don’t do it at all.)

The truth is, budgets can and should be very flexible and forgiving. You can do what you want with your money. Want to eat out? Go right ahead. Just make sure it doesn’t conflict with your necessities. Plan your extra spending after you know you can pay all of your bills and can get ahead. Then it’s no longer a burden.

Related Article: Why Budgets = Freedom, Not Restriction

Why it’s a problem:

Another of my favorite quotes sums this up ...

“If you’re failing to plan, you’re planning to fail.” – attributed to Benjamin Franklin

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How to fix it:

Give a budget a test run.

This means to give it an honest effort for at least 3 months. After 3 months you’ll discover what does and doesn’t work for your family. This will also give you time to streamline your budget so that it’s working well and get into the habit of tracking everything.

Once you’ve worked out the kinks you’ll find a sense of relief to know where your money is going. You’ll feel better about being able to pay your bills on time and can be selective about where your discretionary spending goes.

Nothing is Written Down

Tracking money in your head is not a good idea.

Not writing out your budget means you’re winging it. It would be an extremely rare talent to remember every expense, especially variable and unexpected expenses.

Periodically checking the balance of your bank account or balancing your checkbook isn’t good enough either. It gives a false sense of security. You need to know more than how much money you have, you need to know how much is going out and when.

Why it’s a problem: 

You’ll likely forget some of your transactions or things that are coming up. Something is bound to sneak up and bite you in the rear.

Unexpected expenses can sneak up and bite you.

What? You didn't expect an alligator to bite you in the rear? That thing you forgot to write down on your budget is coming to get you. Can't remember what it is? Me neither!

You are also more likely to splurge on impulse buys or overspend. I like to call it unconscious spending. You know how it goes, when something just “jumps in your cart” and you end up buying it when the money could’ve have been used for a better purpose.

How to fix it:      

Create a system for tracking your money.

Want to know why McDonald’s (a multibillion-dollar industry) can be run by a bunch of pimple-faced teenagers?  Because there are systems in place.

A system can make the difference between broke and thriving.

This can be on paper or a computer spreadsheet. Use the method that you prefer and works for you.

(If you hate the method you’re using you’ll probably quit.)

Join the 5-Day Budget Challenge

Make a budget that works. Take the "From Busted to Balanced 5-Day Budget Challenge" to make a budget that will practically runs itself.

Writing down a budget doesn’t mean it’s set in stone. Like I said before, you can allow yourself flexibility.

Budget Flexibility

Don't sweat it! You can always move money around.

  • Shift money from another category that's less important, like clothes or eating out, to pay the excess portion of your bill.
  • Reassess your budget to see if you need to make a permanent shift in your money (like if your electric company permanently raised rates). 

You're Broke and Behind

This isn’t an easy fix, I know it’s not, I’ve been there.

But it can be done. I know it can, I’ve come back from crappy finances myself. (If you’re curious I have a blurb about my journey on my about page.)

  • Start with where you’re at. Get a clear and honest picture of your income and expenses. (That means start with a written budget.)
  • Take an ax and start cutting back. If you can’t afford all your expenses, somethings got to go. Decide what’s not necessary to live and start there. Food, rent, bills. Those are the necessities. It dumbfounds me how many people try so hard to cut back on rent, utilities, and groceries before they’ll let go of cable, cell phones, shoes and eating out. It might come to saving on groceries and utilities, but first cut out eating at restaurants and stuff you don’t need to survive.
  • Dump your debt. Pay off your debt as fast as humanly possible. I recommend the debt snowball. This is how I paid off over $80k in debt in about 7 years.

(See the section about paying off debt below for an example of how the debt snowball works.)

  • Cut up your credit cards. If you want to get out of the trouble you’re in, you can’t keep relying on other people’s money. You won’t ever get ahead if you insist on staying behind. Stop using them. Period. You can use a debit card in place of a credit card.
  • Negotiate your payoff terms. You do it. Don’t hire a company to do it for you (that’ll just cost you more money!) Contact your creditors that you’re behind with. Be honest with your situation and your ability to pay (or lack thereof). Let them know how much and how often you can pay them. (Since you’ve put together a budget you’ll know how much you can pay and can put it into action.) Then, stick to it. Honor your word.
  • Increase your income. If you find there’s more month than money, you need to get more money. There are plenty of ways to do this. A new job. A second job. A side hustle (where you do odd jobs for others for extra money). Sell stuff.

My husband and I both lost our jobs close together. My husband couldn’t find “real” work again for a long time (almost a year). Do you know what he did?

He flipped burgers.

Yep. A corporate man with a master’s degree went to work in the food industry.

Here’s what he said about it, “I’m not above flipping burgers if it helps support my family and pays my bills.”

Do what it takes to earn enough money for your family. It might mean sacrifices, but if you can get ahead then it won't be forever.

Recommended Reading

Warning: This book will kick you in the teeth so it’s not for the sensitive soul. This guy is a bad a**. If he thinks a budget is a good idea then it’s not too dorky for you. If you could use a little accountability and need someone to tell it to you straight then it’s a great book. (Honestly it made me chuckle a little. He’s more brutally honest than I can be!)

You Overspend

I think to some extent, everyone is guilty of this.

(I’m even guilty of this sometimes.)

It becomes a serious problem when you aren’t tracking what you are spending and you run out of money before your next paycheck.

(That's called "living paycheck-to-paycheck".)

Why it’s a problem:

Going a little over here and there is inevitable, just make a miscellaneous category of $50 or $100 per month to cover those. Or shift money from one category to another.

Going over a lot all of the time is going to break your budget.

How to fix it: 
  • Identify what you are overspending on.
  • Identify spending triggers so you can train yourself to avoid them. (i.e. Do you spend extra when you're bored or stressed? Do you have a problem resisting the latest sale? Do you have a need to go out to eat a lot?) Create a substitute for spending money. Go for a walk or read a book for stress or boredum. Learn to cook a fun cuisine at home instead of eating out. Unsubscribe from tempting email lists that send you sales everyday. You get the idea.
  • Create a budget for your favorites expenditures that you can afford; cut off the ones that overextend your budget. (#sorrynotsorry)
  • Shop with a list and stick to it.
  • Anytime you go into a store, use cash (that you have set aside on a budget). This forces you to keep track of your money. If it runs out, you can’t spend anymore.
  • Get rid of your credit cards. You might think you can afford the payments, but those payments add up and cost you a lot in interest. If you have a problem overspending, credit cards are your enemy.

You're in Debt

Debt can eat away a lot of your paycheck.

Many people have legitimate debt like a mortgage or student loans. Beyond that you probably have a car payment and consumer debt.

You’ve already spent the money and now you need to pay it back.

The good news is, once debts gone you can have that money back in your budget!

Hello vacation! (Paid for in cash – Double bonus!)

Why it’s a problem:

Debt is costing you more than monthly payments. It’s costing you interest and it’s taking away from your paycheck. That’s money you could be using to better your life.

It also creates impatience and devalues our stuff.

We want what we want, and we want it now!

(Just like a 2-year-old tantrum.)

How to fix it:

  • Stop using credit until you can get caught up and get a good chunk of debt paid off. If you have a serious spending problem and can’t help but swipe that card, cut it up.
  • Save up to pay for things you want or will need in the future.
  • Use the debt snowball method to pay off debt at super human speeds.
  • Refinance student loans for a better rate using SoFi.

How the debt snowball works

An example of how to use the debt snowball to pay off debt faster.

Once Credit Card A is paid for, use the money from its old payment to pay off Credit Card B faster. Then roll all the money from Credit Card B into the Car.

You're Not on the Same Page as Your Spouse

This is another sensitive subject for many.

Maybe you really do want to manage money better but your spouse refuses?

What then?

Or maybe you and your spouse simply have opposing views on how and when money should be spent.

Guess what? You’re normal.

That said, getting on the same page and working together is possible.

Why it’s a problem:

Money problems among married couples are one of the leading causes of divorce. (source)

Money isn’t the most important thing, you’re best friend that you married is.

You’ll need to find a way to work out your differences and sort through your money concerns for the sake of your marriage.

How to fix it:

While there isn’t a quick fix for this, I do have some recommendations. You can’t do this alone, you’re partner needs to be involved. It’s time to put down the boxing gloves and work together.

  • Open the lines of communication in a non-threating, non-blaming way.
  • Be willing to have an open discussion where half of it is you giving your view points and the other half listening and understanding your spouse’s point of view.
  • Sit down together and work out a plan. After your initial budget is set, the partner that cares more might want to take the reins, but always involve the other partner and both of you sign off on big changes.
  • Be forgiving and willing to compromise.

For a detailed list of ideas on how to work through this, check out this article on 15 Tips From a Couple Who Never Fight About Money.

Recommended Reading

You Don't Plan Ahead

What day is Christmas?

Did you forget?

Not likely.

Then how is it that so many people are so unprepared for Christmas each year.

And it’s not just Christmas. (I get that not everyone celebrates it.)

How about your car registration?

In case you forgot, there’s a sticker on the plate telling you when it’s up for renewal.

Have things like this ever thrown a wrench in your budget? I bet you could think of several other things, but probably not until they come up and then it’s “Oh crap, I forgot about that. How are we going to swing it?”

Why it’s a problem:

If you don’t think ahead and start planning for less frequent expenses all your well laid plans will go straight out the window. Balancing your budget becomes a balancing act.

How to fix it:

In this article, I talk about how my husband and I use money buckets to make sure we have money for everything we need … not just money, cash. We pay cash for virtually everything.

We call it money buckets because it works like a bucket brigade. We take a small amount of money from each paycheck and allocate it to be used for the less frequent expenses. We save up for Christmas, tires on our car, maintenance and vacations. Then when the time comes we have the money to pay for it and it doesn’t interfere with our regular budget.

The concept of money buckets is a brilliant way to save. Use it to build your savings account to pay for less frequent expenses.

Save a small amount of money from each paycheck to build a nice savings that will help you pay for less frequent expenses.

You Don't Have an Emergency Fund

A recent survey found that 57% “of Americans don’t have enough cash to cover a $500 unexpected expense.

Many would have to rely on a generous friend or family member or a credit card to cover the expense.

An emergency fund is like insurance, it helps cover those things that happen in life that are unpredictable and unavoidable. Its sole purpose is to pay for true emergencies, not a flash sale on your favorite gizmo at the store.

Why it’s a problem:

It’s not a matter of if, but when the next emergency will arise. It’s life. Emergencies happen to everyone.

Being prepared is the difference between getting through or getting destroyed financially.

It sucks no matter what, but having some money set aside makes it suck less.

How to fix it:

  • Start small. Set a goal for $500, when you get that add another $500.
  • $1000 should be your minimum fund. 
  • Don’t overwhelm yourself trying to save half your salary.
  • If you use money from your fund, make it a priority to replenish. Restock your emergency fund before you pay extra on debt or splurge on discretionary spending.
  • Avoid using credit cards if possible. If you have no other options I won’t condemn you for doing what you need to do, but seriously try to avoid putting an emergency on a credit card. It turns it into a long, drawn out pain in the neck because it’ll affect you long term.
Why isn't your budget working? Get help for budgeting money. Identify what habits are impeding your progress and what to do instead. Change you habits and your money will follow your lead. There are several things you can do to get your budget in great shape.

Take some measures to get your budget established and work on sticking to it. It'll need some massaging and ironing out, but once you've started living by a budget you'll learn to love and rely on the peace of mind it provides.


Cameron is a Financial Coach who works with couples and individuals to achieve financial freedom and peace of mind. She believes being in control of money = less stress + more fun! Join her on the journey to think about money less and enjoy life more.