There are months when sticking to a budget is easy. And of course, there are months when you manage to mess up your budget and find yourself in a shortfall. Especially if you don’t have an emergency fund, any unexpected expenses like car repairs or a medical bill can ruin your budget at the beginning of the month.
How can I cover the remaining expenses?
If you have messed up your budget, the first thing you should do is reduce the amount you spend daily. Depending on how tight your budget is, you may need to stop spending altogether.
You will want to take action to minimize the amount you spend at the grocery store. Try meal prepping with food you already have in your pantry. Also, bring your lunch from home to work.
You should also consider the difference between necessities and entertainment. If it’s a luxury, you should ignore it for the rest of the month. You might also consider cutting back on items you usually consider necessities. This change can make a significant difference in how long it takes you to recover from a financial misstep.
How can I be creative?
If you find yourself in a severe money shortfall for one month, you may need to be creative in finding ways to meet your needs. Consider taking on a temporary side job, like driving for Uber or delivering food. You might also be able to pick up part-time work from friends and family, such as cleaning houses, gardening, or running errands.
You might think about selling items you own on resale websites like Craigslist. Unneeded furniture, clothing and shoes, and even jewelry can be good items to sell to earn some extra cash.
Should I use a credit card?
Using a credit card when you’ve messed up your budget can be risky. If you are still facing a shortfall in monthly expenses, you may have no other choice. For example, if you don’t have enough money to cover food costs for the month, you may need to use a credit card. But if you do, remember to buy everything at the lowest possible cost and avoid dining out or any extras, as every penny you spend, you will have to pay back with interest.
An alternative to using a credit card is to contact your credit card company or student loan provider and request a temporary deferment on payment dates until you get back on solid financial ground. Many companies will do this if it’s not a regular occurrence.
Remember: if you use your credit card to help bridge the gap, you should also have a clear plan in place for how to pay off the debt in the next month or two.
Prevention is key
If you find yourself in a pattern of running out of money every month, you need to reassess your budget and spending habits, and perhaps even find ways to earn more money.
If unexpected expenses like car repairs are throwing you off track, an emergency fund should solve your problem. An emergency fund allows you to cover expenses without impacting the rest of your budget.
If you find yourself messing up your budget on clothing, dining out, and other unnecessary items, you need to consider whether you have spending issues that need to be addressed. You should also decide whether your budget is actually working. Often, people who struggle in this way have no budget at all. You can also look for new ways to save each month to limit your overall expenses.
Reassess your budget
If you find yourself running out of money regularly every month, you may need to rework your budget.
First
One thing you need to consider is whether your budget is realistic. For example, if your grocery budget item is $100 a week and you are regularly spending $150, you should adjust it.
To find out what area needs adjusting in your budget, you will need to track your expenses. Then you can see if you’re overspending in certain categories like entertainment.
Switching to an envelope system can help you manage these issues. Or if you don’t want to change your spending habits – or if you live in an area with a high cost of living – you may need to look for a job that pays more. Increasing your salary can help you meet your financial obligations each month.
Updated by Rachel Morgan Cottero.
Source: https://www.thebalancemoney.com/oops-i-blew-my-budget-now-what-2385614
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