Budgeting Series Part One: 5 Reasons Your Previous Budgeting Attempts Failed

by Joe Plemon on January 17, 2011

Welcome to our Budgeting Series!

Wait!! Don’t hit that back button just yet. You know deep down inside that you need a budget. Right? Right! So let’s make a deal.

My part is to write the following four part series with the promise that each segment will be short and simple:

Understanding why your last budget didn't work is critical for making your next one succeed.

Part 1: 5 Reasons Your Previous Budgeting Attempts Failed

Part 2: 5 Things Your Budget Will Do For You

Part 3: Nuts, Bolts and Tips for Your New Budget

Part 4: How Your New Budget Will Change Your Life

Believe it: you CAN have a simple budget. You won’t be reading any financial technobabble nor will you need any high powered math skills or cumbersome spreadsheets.

Your part is to read the series and give budgeting a try. After getting your budget up and going, you can always go back to your current method of mismanagement if you want, but my guess is that you won’t want to.

Fair enough? Great!

Let’s dig in with Part One: 5 Reasons Your Previous Budgeting Attempt Failed

I realize your past attempts at budgeting haven’t worked, but ask yourself, “Do my former failures justify future mismanagement?" Of course not. Millions of people successfully manage their money and, if you can identify the pitfalls which shanghaied you in the past, you can too.

See if these sound familiar:

1. You left things our of your budget.

Many people grab a yellow lined pad, write down what they think of at the moment, and expect it to work. Budgets need to include EVERYTHING, even an appropriate amount of “blow money". Why? Because in real life we really do blow money.

2. You made it too complicated.

Computer nerds: listen up. A workable budget isn’t a 10 page excel spreadsheet that you deliver from the mountain like Charlton Heston in “The Ten Commandments". A workable budget needs to be simple.

3. You didn’t actually do it.

Some people talk about budgeting and think about budgeting but never actually get paper and pencil out and write one. Is this you?

4. You didn’t actually live on it.

No matter how carefully you prepare your budget, it is useless until you (and your spouse — if married) commit to following it. That commitment is the difference between theory and reality. Here is the deal: you control the budget, but once it is complete, it controls you. No cheating and zero exceptions. If you don’t like something in it, go ahead and make adjustments, but always re-commit to follow your budget each time you fine tune it. You will never know if it works unless you live on it.

5. You gave up too soon.

This is the biggest budgeting pitfall. You will not have a perfect budget the first month you try it, so don’t expect to. I am not being pessimistic; I am being realistic. So don’t give up if your budget has holes in it the first month you try it; think of it as a work in progress and give it three or four months to cooperate fully.

Don’t give up on budgeting because of past failures. You work hard for your money and it should work hard for you. Get up, dust yourself off and try again!

Did I keep my promise of short and simple? Let me know. And let me know if you are doing your part.

Readers: have you tried and given up on budgeting? Why? If you are successfully budgeting, how many months did it take you to make it work?

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