Top 10 Budget Busters
Even the most diligent budgeters can get off track, especially when faced with these notorious budget busters. The best way to stay on target is to be aware of where your spending may go wrong and do your best to avoid it.
1. Impulse purchases
Did you grab that extra item at check out? Did you go to the grocery store hungry? Or maybe all those online ads and emails promising limited-time savings got you to run your card? The impulse purchase comes in many shapes and forms, but making a shopping list ahead of time can be your trusty road map to your budget goal. Online, consider putting that item in your cart and heading back a day or two later before pulling the trigger.
2. Small extras
Most people don’t plan to buy a magazine here or a pack of gum there, and we’ve all heard about the dangers of a latte habit. The problem with “extras” is that they trick you into thinking you’re not overspending, since they’re inexpensive purchases. In the long run, these purchases can add up, so don’t give in to the siren song of the clearance nail polish.
3. Television and movies
Cable television is a pricey indulgence these days, and many consumers purchase streaming subscriptions on top of cable. Renting a movie from kiosks, on-demand services, or even going to a theater can rack up the cost quickly. Unless you’re a true television and movie aficionado, you can probably find somewhere to trim the fat. If and when you do set up that Hulu subscription, check to see if it’s automatically renewable. Many are auto-set that way; check your account after the initial subscription to be sure.
4. Fees and fines
These budget busters run the gamut from small (ATM fees) to large (parking tickets), but they’re all unnecessary. The worst part about these expenses is that you don’t even get to enjoy spending the money. Watch out for credit card interest and fees, overdraft charges and other places that can leak money if you’re not careful.
5. Restaurants and fast food
It’s always cheaper to make your own food at home, because restaurants and fast food places charge for convenience. It’s okay to treat yourself once in a while—make an “eating out” budget so you don’t overspend—but going out to eat regularly is one of the surest ways to blow your budget.
6. Aspirational spending
It’s normal to want to look and feel your best, but it shouldn’t be at the expense of your budget. Don’t buy a gym membership that you never use (try a regular routine in the comfort of your home by using YouTube videos before signing up at gym) or clothes that are too small or trendy. And if you decide to take up a new hobby, try it out for a while before splurging on supplies.
Medical emergencies, car repairs and other surprise expenses can eat away at your savings if you don’t plan ahead. Emergencies shouldn’t really be considered surprise expenses—you know you’ll eventually have to pay for some kind of emergency; you just don’t know when or what. Buy insurance with preferably higher deductibles, build up an emergency fund, and practice preventative maintenance on yourself, your home and your car.
8. Gifts and donations
If you always donate to your friend’s cancer walk or buy your mom a gift for her birthday, these expenses shouldn’t be surprises. Save up for special occasions and charitable donations so they’re no longer an unpleasant yearly surprise.
9. Retail therapy
If you feel like splurging because “I deserve this!” then back away from the credit card. You may feel like you need a manicure, a vacation or a shopping spree after a hard day at work, but you don’t deserve to ruin your budget.
10. Irregular bills
A lot of bills—tuition, home maintenance, etc.—don’t come every month, but you still need to budget for them. If it helps, set up a separate checking account for these bills and pay into it monthly so you have enough when the bills come due.