The coronavirus outbreak sure created plenty of financial stress. In this challenging times, your budget will save you. Keep updating it and make sure you avoid these 10 budgeting errors that will sure compromise you during this pandemic.
- Not updating your budget.
A budget is a living thing. It requires adjustments every month. A stale budget will not help you. Make sure you adapt it to your current needs.
- Not tracking your bills.
Guesswork over your expenses will not do your budget any favors. Record your spending in all categories for a month and use this total in setting up your budget. Do this monthly and adjust as needed.
- Assigning expenses by paycheck.
A much better strategy is to allocate a portion of your paycheck to multiple expense categories. This supports better cash flow and ensures you will not have late payment problems when money is suddenly tight.
- Not tracking your spending.
If you track your spending, you can easily stay within your budget. Otherwise, you might end up spending too little or too much and miss your financial goal.
- Not including all items.
When you write your budget, make sure you include all expected expenses. Missing one will already derail your plan! It does not matter whether it is a big or small expense. You want to get in the habit of planning your spending and sticking to it.
- Leaving out your partner.
Your budget will only work if you and your spouse are on the same team. Take the time to discuss your budget and work on it together periodically. This will stop you from overspending and having fights over money.
- Not setting up an emergency fund.
The pandemic highlighted the importance of an emergency fund. The unexpected broke out and those with a healthy emergency fund are able to weather the storm. They can use their fun to pay for their food, medical bills, and rent. Those without a fund are lost and panicking. Which side of the fence do you want to be?