4 Signs You Need A New Budget
Budgeting is the process of working out your income and expenses, and creating a plan for your money.
Regardless of how much you earn, having a budget is essential for good money management. But how do you know if your budget is working for you?
Here are some telltale signs that your budget may need a review.
You always go over budget
It's all good and well to have created a budget, but it needs to be realistic and practical.
It can be difficult to predict just how much you're going to spend on certain categories, but if you find you're constantly going over your budget, then it's time to review your budget.
It can be difficult to admit that you need to allow more money for certain things, especially when you're trying to keep expenses down, but you have to be honest and realistic if you want to take control of your finances.
You feel stressed and deprived
Contrary to popular belief, a budget is not supposed to deprive you. It's simply a tool designed to help you take control by giving your money a purpose.
Having a budget that is too restrictive can suck the joy out of your life and make you feel miserable. You shouldn't have to cut out all the things that make you happy, so make sure your budget includes things you enjoy.
You don't have to be extreme, just consistent.
You aren't getting closer to your goals
Your budget should be helping you get closer to your goals. Whether you're saving up or paying off debt, if you aren't making progress towards your goals then you should review your budget.
Your expenses exceed your income
A budget is supposed to help you manage and organise your income and expenses.
If your expenses are higher than your income, then your budget definitely needs some work.
Work on lowering expenses or increasing your income and then review your budget again.
Final thoughts
Budgeting may seem overwhelming, but they shouldn't be restrictive or make you feel stressed. In fact, the purpose of a budget is to help you gain control of your money and avoid financial stress.
There's no 'one size fits all' when it comes to budgeting, so it's important to find a budget that works for you.
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