Bad Budgeting: Why Your Budget Actually May Be Bad Thing

Is there such a thing as a bad budget? Furthermore, can budgeting in a way that is counterproductive cost you money?

The truth is the answer to both questions is a resounding “yes.”

Budgeting is like any other money-related task in that you see good ones and bad ones, ones that get the job done of managing expenses and income, while others fall woefully short. And in turn, the answer to the second aforementioned question also is affirmative.

Your budget has the potential to fall woefully short in some ways, so just because you have a system to tackle saving money doesn’t mean you’re doing it properly or that the budget itself or carrying it out is perfect.

Having a budget that is depriving you of spending isn’t going to get the job done, even though conventional wisdom would tell you differently. Sure, you want to make sure your income outweighs your expenses but at what cost?

That simply means that your budget has to have spending for things that you enjoy built into it, and to do so you might have to kill a few utilities for example or find cheaper alternatives to other things you enjoy (cable, phone bill, etc.).

And just because you say you have a budget doesn’t mean you’re falling along as you should. The budget mentality isn’t quite the same as actually using a system to keep track of your money and how you manage it. Whether you have a spreadsheet on your computer or use an app on your tablet or phone, you can’t get around the fact that budgeting isn’t just about saying, but those actions will always speak louder when it comes to you saving money.

Overlooking items, too, are budget killer as well. Those who attempt to budget will do one of two things: they’ll forget about something they buy on a regular basis and put it as an incidental expense rather than actually including it on a budget, such as cigarettes, coffee or eating lunch at a restaurant on a consistent basis while taking your break from work.

Furthermore, you can’t ignore bills that are paid quarterly or twice per year. When you decide to put together a budget, you can’t forget about something like taxes you pay or even something as simple as a garbage or sewage bill that isn’t a monthly expense. You should break it down into a monthly expense to add it to your budget.

Having a “bad” budget simply means you’re talking a good game but not backing it up with a realistic, relevant and renowned budget that you carry out consistently.