5 budget mistakes you should avoid

gboyinwa ajomale

November 8, 2017 11:39 AM

Not having a budget is the greatest budget mistake

People tend to give up on

Here are budget mistakes you might be making which you should try to avoid.

1. Not having a budget

Not having a budget is the greatest budget mistake.

Living every The biggest budgeting mistake is not having one. Having no budget makes you live life without having a clear-cut plan for your finances which is likely to leave you in financial crises.

You might survive it but you are not progressing financially which leaves you in the same position.

If you have no budget, create one soon.

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2. Not tracking your spending

If you are in the habit of spending without knowing how you spend, then it is bad for your budget.

If you don't keep track of your spending, it would be difficult to know if you have reached your spending limit.

Start tracking to make your budget work well for you.

3. Leaving out items

One of the most common budget mistakes people do is leaving out items when calculating their expenses for a month.

People tend to forget some things when creating a budget. It could either be a little expense which might not matter or something you pay for only once a year. But no matter how small or time range you have to pay for something, It has to be put in your budget.

Try not to forget items when creating a budget. You can also go back to previous budgets to check what you might have left out.

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4. No emergency fund

Having an emergency fund helps you to pay for things you didn't plan for outside your budget.

Apart from what you budget each month, set aside money for emergency expenses, so you can pay for unexpected expenses without having to worry about your budget.

5. Mistaking wants for needs

A lot of people mistake wants for need. There is a difference between wants and needs.

There are some basic things you cannot do without, that is considered as needs, but what you desire or crave for is considered as wants. You can't cut back on your needs, but you can do without your wants.

If you don't need some things, it shouldn't be in your budget.

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