My job is to teach budgeting on almost a daily basis.  I believe the power of budgeting and rely on it to succeed.  It’s a powerful tool and it can help you out of debt, save for a rainy day, or push you toward meeting any number of financial goals.  It’s not magic, and requires a lot of effort and planning, but a successful budget can help anyone dealing with financial woes and money shortfalls.  Talk to anyone who recently started a budget and they’ll tell you how effective it is and how much better their lives are for starting one.

It can’t fix everything unfortunately.

At the end of the day, the budget is only as effective as the person running it.  A successful budget requires more than just balancing the numbers and staying out of the red.  It requires habits and behaviours to be changed in order for it to work.  No matter what you plan for, no matter how you adjust it; a budget will not eliminate your bad habits.  Only you can do that.

Here are three of the main problems that a budget cannot fix.

Denial

Maybe there are some things going on in your life that the budget just can’t accommodate for.  Maybe you have overextended yourself with a recent purchase of a home or vehicle.  Maybe you are not making enough money at your current job to cover all the expenses your household requires.  Whatever the reason may be, if you close your eyes to the reality of your situation but still expect your budget to work, you are sadly mistaken.  You need to take an open and honest look at your budget and decide if it is realistic.  Only then can a budget do what it is supposed to do.

The Need to Acquire “Stuff”

If you’re building a budget in order to buy “stuff” it’s going to fail.  And when I say “stuff” I mean material things that you just don’t need.  Another pair of shoes, more of the same tools, books you are never going to read are WANTS and not NEEDS.  Chasing happiness with purchases is a game you just can’t win.  In my experience, once you purchase whatever it is that’s calling your name, the positive feeling quickly passes and then you’re looking for something else to give you that feeling back.  And it seems that whatever the purchase – new TV, new computer, a new piece of clothing – it must then be replaced with something even bigger and better than the last.  Soon, you’ll be looking to buy a bigger, better home than the last just to get that feeling back again.  Having a budget won’t stop you from looking for happiness in the purchase of items, but it will keep you grounded in reality and make sure you’re not spending yourself into the poor house.

Lack of Self Control

A budget will only provide a guideline and boundaries for your financial reality.  It will not magically give you the ability to control your spending habits.  The difference is you’ll KNOW when you are spending money you don’t have.  Not following the budget is pretty much the same and not having one.  It’s like having a workout routine and never doing the exercises.  It sounds good on paper, but not so good in reality.  If you’re always justifying to yourself (or your partner) why you need to skip a payment or use credit you might have a problem with self control.  By giving into your every desire, or the desires of the people around you, the budget is basically just a good idea.  Like building a muscle, self discipline requires exercise and determination to grow and become useful.  Start small and work up to the big things, but do it quickly because your budget is waiting to work for you, not against you.  The more you stick to the budget the easier it will become.

A budget is a powerful tool if used properly.  It requires discipline and dedication but will be worth it in the end.  You need to take an open and honest look at your financial situation and create a budget that will work for you.  Seem like an impossible task?  Call us at the Sudbury Community Service Centre and make an appointment with a qualified and accredited credit counselor to get help setting up your budget today.