A cartoon calculator adding up a budget.

Don’t Break Your Budget

Sticking to a budget can be tricky at times, especially if you let yourself fall for some all too common money traps. Take a look at 10 of the most common and damaging budget breakers and see how many you are guilty of.

1) High Car Payments

With the average car payment in this country currently at around 700 dollars, you are likely paying more for your car each month than you ever thought you would. This is because car payments have a tricky way of sneaking up on you.

It works like this. You get a car and your credit gets you into a great loan with 0 down. Then, a few years later you decide you want a new car, but you have no equity, since you put 0 down on your last purchase. To get your new car, you now have to carry thousands of dollars in negative equity, which the banks will do. Rinse and repeat this a few times and you have an outrageously high car payment.

Fix It

The way to fix this is to simply “stick”. Hold on to your current car until you have equity in the loan and a sufficient down payment for a new one. You can then purchase a new vehicle with a reasonable payment and a reasonable loan term.

2) Frequent Meals Out

Who doesn’t like a meal out. You can have someone else cook for you and, perhaps best of all, have someone else clean up afterwards.

The problem is that it is easy to get addicted to dinners out and it is easy to go over budget when all you have to do is point to a menu. This is particularly true if you like a drink with dinner.

Fix It

The answer to this problem is discipline. Realize that you can not have everything in life and limit yourself to dining out once a week. When you do dine out, look for specials such as “kids eat free” nights or sign up for restaurant discount e-clubs.

3) Big Housing Payments

Your mortgage or rent will almost always be your biggest monthly expense and like everything else, it is possible to get carried away with it. You want the biggest home in the nicest area, but that comes with a cost both directly and indirectly. The mortgage or rent will be high and so will the utilities and upkeep.

Fix It

Sometimes a modest home is the best long term solution. When choosing a place to live, keep the big picture in mind, especially if you are renting and not gaining any equity.

4) Online Shopping

For many, online shopping is a way of life, but it can have disastrous effects on a budget. It is just all too easy to overspend on the internet, especially with one click purchases and next day or even same day shipping. You might think that the convenience of online shopping is for the benefit of the consumer, but the truth is, the ball is completely in the retailers court.

Fix It

Try to limit your online time as much as possible and use a browser with privacy protection. That way the sweater you were looking at online won’t follow you from website to website.
Also, delete credit cards and disable one click purchasing. The harder you make it to finalize the purchase, the more time you have to come to your senses.

5) Grocery Shopping Without A List

Grocery stores are masters of merchandising. When you go in without a list, you will be at the mercy of their advertising and can easily end up spending 20 or 30 percent more than you otherwise would have. This is food that will either go unused or even worse, will spoil.

Fix It

Start meal planning so that you can make an accurate shopping list. It is simple, just write down all of the meals that you want to make in a week and then list the ingredients you need to make them. After crossing off items you already have, you will have a perfect grocery shopping list with minimal waste.

6) Lavish Vacations

We have all heard the expression “all work and no play” and maybe some of you have taken this too much to heart. While we need vacations from time to time, they can be problematic. Not only are they expensive, but they open the door to careless spending, after all, you are on vacation.

Fix It

Set a budget for your vacation before you even pick a destination. Then choose a location that fits with your budget. Also limit your spending on your vacation to a reasonable level, never putting anything on a credit card that you could not pay for with cash. And, cut out the souvenir shopping for others. This is your vacation, not an obligation to buy everyone you know a cheesy gift.

7) Shopping The Sales

A great deal is hard to pass up, even if it is for something that you do not really need, or want for that matter. Before you know it, you have a closet full of things, likely unopened, that you have absolutely no use for.

Fix It

Avoid shopping a sale, just because it is a sale. If you need something or can realistically foresee needing something in the near future, make the purchase. Otherwise, skip the deal. Even if it is a huge savings off of normal retail prices, you do not need it and it is still money out of your budget.

8) High End Gym Memberships

That luxury gym sure is nice, but how often do you really use the facilities. When you signed up for a membership, your intentions were probably good, but now you are trapped in a membership that you do not use and that will be difficult to get out of.

Fix It

The trend these days is discount fitness, costing as little as 10 dollars per month. If you actually use your gym membership, consider switching to one of these clubs. Then, take the time to cancel your gym membership. This will likely involve an in person visit to your gym, but set aside the time and stop wasting money each month.

9) Prepared Meals

Whether it be having food delivered, picking up a prepared meal from the grocery store or a meal prep service, prepared meals are expensive. Whenever human hands have to touch something, labor is involved and you will pay dearly for it.

Fix It

The simple way to fix this problem is to learn to cook yourself. It is not as hard as you think, as long as you take it one step at a time. You are not going to go from not knowing how to boil water to prepping a meal like Martha Stewart in a day. Get some simple recipes under your belt and then slowly progress. The results might just shock you and will certainly save your budget.

10) Credit Card Payments

It is not uncommon for a person to have credit card debts approaching, if not exceeding 5 figures. That means monthly credit card payments that could total 200 dollars or even more. That is money that could make a huge impact on your savings and would certainly help your overall budget.

Fix It

Blindly paying the minimums on your credit cards is not going to fix this situation. You need a plan and you need to act on it. Luckily, there are a number of credit card debt reduction plans that can help you succeed. Methods such as the Debt Avalanche and Debt Snowball can help give you the motivation to finally get out of debt and eliminate those huge budget breaking monthly payments.

One Reply to Don’t Break Your Budget

  1. That is actually a pretty useful list, of course it makes me feel bad. It looks like I am making a little over half of those mistakes.

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