What to Do When You're Over Budget
Did you blow your budget? Here’s how to recover.
Oops… Did you go over your monthly budget? No problem — we’re here to help turn a stressful situation into a challenge you can overcome. (How do we know it’ll be okay? Because you have a budget in the first place. And that’s a good sign that you care about your finances.)
Making your budget work might require some fine tuning, but with a little know-how and money-saving strategies, you’ll be set up for success. Let’s take a look at some ideas to cover your remaining expenses, pinpoint where your budget went wrong and tips to help you prevent going over your budget in the future.
How to Cover Your Remaining Expenses
Whether you still need to pay off a larger bill for the month, like rent, or you’re looking for quarters in the cushions for gas money, follow these tips to help cover your remaining expenses:
Stop spending — and stop dwelling. First and foremost, it’s clear by now that you shouldn’t be spending any more money this month other than where absolutely necessary. But it’s also important that you stop dwelling on your mishap and get yourself in check. Acknowledge that mistakes happen and get back to your budget.
Eat what’s in the cupboard. Get creative and whip up some meals using the food you already have in your kitchen. It may not be exactly what you’re craving, but it’s a meal you’ve already paid for. Do you often eat out for lunch at work? That can add up quickly over the course of a week. Instead, pack up some leftovers and bring those for your mid-day meal. Being resourceful with the food you already have can save a substantial amount of money that can be put towards other areas of necessity.
Return purchases. Do you have some clothes hanging up with the tags still on them? How about those shoes you had to have but never ended up wearing? If you still have the receipts, take back anything you haven’t used and put it towards bills you still have to pay.
Consider resale. Now is a good time to go through your things and find sellable items. There are plenty of online sites that make it easy for you to sell from the comfort of your home. Or look up a clothing resale shop where you can take the clothes you never wear. They can be selective with what they’ll take, but it’s worth a shot to help you cover expenses right away.
Get a part-time gig. If you’re strapped for cash and really need to make ends meet, it’s time to put yourself out there. Try a temporary gig, like a rideshare service (think Uber or Lyft). Contact family and friends to see if they have any odds and ends jobs like mowing the lawn, shoveling, housecleaning, babysitting, etc. You may find that these are great ways to make some side cash.
Work overtime. If you have the option, consider working overtime to add to your paycheck. Depending on the type of work you do, pick up an extra shift from a coworker. A bonus of working extra hours? You’re not tempted to spend any money!
When it’s time to use your credit card. Pulling out the plastic to cover expenses should be a last resort. After all, you’re only putting yourself deeper in debt by paying off bills this way. But it’s understandable that desperate times call for desperate measures. Only give yourself permission to use your credit card for any bills that will be overdue or for emergencies. If you absolutely need to get groceries, buy cheaply and make a list that you don’t stray from. Be sure to make a plan to pay off that credit card debt when budgeting for the next month or two.
Taking a Close Look at Your Monthly Budget
Impulse buys, convenience purchases — these are often the main culprits when exceeding your monthly budget. To find out where your specific problem areas exist, as well as to better stick to a budget, it’s important you have a way to track your money. Try following these tips for creating a budget:
Write everything down. Sure, you have a budget, but if you’re not keeping track of what you’re spending and when, it’s easy to go over and spend more than you have. Take one week and write down every penny you spend. From the automatic payment on your car insurance to the quarters you used for laundry, write it down on a piece of paper so you get a close look at exactly where your money is going.
Use the zero-based budget. Once you’ve done your due diligence and tracked your expenses for a week, consider using a zero-based budget. This type of budgeting is when your entire take-home pay minus your expenses equals zero. In other words, every single dollar is being tracked. It’s up to you where the money should go, but once you’ve set your budget, you’ve got to stick to it. Because any time you overspend in a category, you need to make up for it by taking from another category. Or consider yourself in the hole.
Determine your wants versus needs. Food and a home are necessities and essential to your wellbeing. Restaurants and entertainment are luxuries that aren’t needed to survive, but can be budgeted for once all other needs have been allocated. Having an emergency savings account is essential to budget for times you’re really strapped for cash, too. Here are some tips for creating a budget — you’ll become a financial pro in no time.
Tips to Stick to Your Monthly Budget
Now that you have a better idea of where your money is going, try these tips to stick to your monthly budget:
Set goals. Short-term or long-term, a goal is a great way to motivate you to stick to your budget. Whether it’s to pay off a big debt, like student loans, or save up for a vacation, saving your money is a lot easier when you’re working towards a “reward” of sorts.
Create your own entertainment. Spending money on entertainment, including eating out, is one of the biggest reasons people go over their budget. Instead of going out and spending money on fun, create your own! Invite friends over for a game or have a movie night. Look for free concerts and entertainment around your city. There are endless ways to be entertained without spending money!
Become a planner. Spontaneity and going with the flow can be great personality traits — but not when it comes to money. It’s too easy to spend, spend, spend when you don’t have a plan in place. Sit down and plan out your meals for the week and think ahead to events you have coming up that you’re obligated to go to. It’s easy to eat out when you’re constantly on the go, but when you know what’s coming up and can plan to bring a snack or meal with you, it’s a lot easier to not be tempted to spend money on food.
Use cash. Regular monthly bills are just fine coming out of a checking account, but if you often go over budget in the entertainment/for fun category, take out cash for these types of purchases. It’s more difficult to hand over cash in real time than swiping a card that deducts it from an account that you check later. Watching money go away little by little is a great reminder to think twice about a purchase. And, once that cash is gone, you know you don’t have any money left to spend.
For some people, it may take a little time to get in the habit of sticking to a monthly budget. It may even take a few months to really determine a budgeting style that works best for you. The most important thing is you have a budget in the first place and are working on creating a healthy financial state. Want more money-saving strategies? Check out our easy tips to keep your budget on track.The information in this article is for informational purposes only. It should not be considered legal or financial advice. You should consult with an attorney or other professional to determine what may be best for your individual needs.