In this post, I will talk about some of the reasons you should decide to feel good about the fact that you might suck at budgeting (for now).
That’s right: You’re supposed to suck at budgeting when you first start out, and you will keep on sucking at it for a while, and that’s okay. In fact, it’s totally normal. The only way to get good at something is to be bad at it first. You need that trial and error in order to have the learning experiences that help you to eventually excel. So let’s talk about some of the reasons why it is okay (and encouraged) to be bad at budgeting.
- Budgeting is hard if you’ve never done it before.
- There are people who grew up with family members who modeled good financial habits like budgeting and living within your means, but I was not one of those people. Personally, until I started learning to keep one, I had never even seen a budget in action. I didn’t really know what it would look like, or how it would work. My parent eventually learned to budget and took control of their finances, but not until after I was already an adult, so I didn’t have the opportunity to learn from them (As a side note, when I started to learn about managing money, it didn’t actually start with budgeting, because I didn’t even know this was something I needed to do. Luckily, this is one of the first things most books/articles/podcasts tell you to do, so I realized it quickly). Once you decide to keep a budget, you may still need to figure out exactly what that means, and it’s okay for that process to take some time.
- You have to find the method that works for you, and it might take a couple of tries.
- When I decided to start keeping a budget, I did some research online about what programs were available. I initially did a Google search for something like “Best budgeting programs”, or “Best easy budgeting programs”, and read some reviews. I ended up narrowing it down to Mint.com and YNAB, because they were described as unintimidating, user friendly, and available across devices (computer, cell phone, etc.). I ultimately settled on YNAB because it was described as having free courses available that would teach me how to use the program, and also because it was described as having a very active community of users to whom you could ask questions. Both of these things were true, and when I first started, I took one of their free online courses, and I read the weekly emails from “Jesse @ YNAB”. To this day, I continue to find help with the program and its features on the YNAB website, or in Reddit threads created by users with the same wants/needs/issues as me. If you want to do something on YNAB, chances are there is a Reddit thread that will tell you how. Otherwise, the YNAB website will. As a note, I also use Mint.com, but I use that to look at my overall financial picture / my global net worth. I know they also offer a budgeting system, and I’m sure it’s great; YNAB is just the one I ended up settling on, and is now the one I have taken the time to learn.
- You don’t know how much you spend until you start tracking it.
- What happened to me the first couple times I tried to budget was this:
- I would choose a random number of dollars to allocate to a category, based only on guesswork, because I had never tracked my spending before. For example, “I think this is how much I spend on _______, so I will put this much money in that category.”
- I would then spend “too much” or “too little” in that category, because it wasn’t based on any real facts or data about my past spending.
- I would feel like I had failed because I spent the “wrong” amount of money, based on my invented budget amount.
- I would become discouraged by my repeated “failures”.
- I would quit.
- The bottom line is that until you have kept track of your spending for a while, you just don’t know how much you spend on what. That’s okay. You should expect that when you start budgeting. It’s the nature of the game to be constantly adjusting the amounts you allocate to each category. All you can do when you first start out is make guesses about what you might spend in each area of your life, and then expect that you will have to alter that as you begin to learn more about your spending habits. The amount you are spending isn’t necessarily “wrong”, you just haven’t figured out how much should go in each category yet.
- What happened to me the first couple times I tried to budget was this:
- Life is imperfect and full of surprises.
- You can never make the perfect plan. Life will throw you curveballs and you won’t see them coming. That’s okay. You can always move money from other categories as needed, or implement a “buffer” or emergency fund for these types of unforeseeable expenses. This is one reason I really like (and am now implementing) Dave Ramsey’s idea about always maintaining an emergency fund, no matter what. This is one way you can be prepared to navigate the unexpected.
- You do get better at anticipating some of the “surprises” life throws at you. For example, when I first started budgeting, things like new winter tires seemed like a surprise, but now that I have learned more about my financial needs, I know that this is something that is likely to come up for me every few years, so I save and plan accordingly.
- Budgeting is a skill, and like learning any skill, it takes time.
- Remembering this point can be crucial to having success (or not) with budgeting. What I mean by that is that if you assume that you must be great at budgeting immediately, and then you are not, then you are likely to have a lot of negative self-talk about it. Self-talk is the constant, ongoing, fast thinking that we are all doing all the time about everything we are seeing or doing. It is mostly comprised of judgments. We are constantly evaluating everything around us by quickly thinking things like “I like this / I don’t like this / This is good / This is bad” etc. This constant thinking also applies to thoughts about ourselves and about our actions. This is primarily what I mean when I talk about “self-talk”. If you think budgeting is supposed to be easy, and then it is not, you might quickly and unconsciously think things to yourself like “I’m so bad at budgeting / I keep making mistakes / I keep failing / I might as well quit.” If you have to deal with this kind of thinking around budgeting, it’s going to be an unpleasant experience, and you will probably give up. Imagine trying to learn to do something new if someone was looking over your shoulder and constantly telling you how bad you were at it and that you should just quit.
- How much do you think you would like that activity? Probably not a whole lot. So remember that budgeting is hard if you have never done it before, and that it’s okay to be bad at it. Being bad at budgeting is a LOT better than not trying at all. If you have never kept a budget before, it’s a brand new skill. In order to get good at it, it’s going to take time and practice. You wouldn’t pick up a guitar, try it for one week, and then quit because you weren’t immediately a rock star, right? Budgeting is the same. You won’t be amazing at it immediately, and you might find it sort of hard, and that’s totally normal. You are going to have to learn the budgeting system you choose to use, and you’re going to have to get used to the new behavior of tracking your spending. This brings me to my next point…
- Budgeting is not just tracking your money, it’s also a behavioral change.
- Budgeting is not simply tracking your money. It’s also a behavioral change like learning to exercise regularly, eating healthier, or any other behavioral change. This is especially true if you are someone (like myself) who has already gotten yourself into financial trouble (racking up consumer debt, taking on student loans, etc.). If this is the case, then you may not be used to the behavioral changes that tracking your spending implies. For me, it meant I couldn’t just buy the next shirt/pair of shoes/restaurant dinner I felt like, and would actually have to adjust to spending less, and choosing when/where I spent my money more carefully. This is a difficult change to make, and you should expect setbacks and “relapses” into your previous way of spending. This doesn’t mean that if you experience a spending setback, that you should continue to fly full-speed into a spending frenzy, but that you should accept that setbacks are a totally normal part of the process of change, and that you can learn from them to become stronger and more successful.
- It’s also important to note that behavior change takes time because it’s also a physical change. That is, you have to build the new neural networks in your brain associated with the new activity. Imagine this is like building a muscle. Let’s say you want to hold a handstand and you have never done one before. In order to get there, you are going to have to spend many days, nights, weeks, etc., building up the muscles needed to do it. The same applies to your brain. If you want to learn a new behavior, you need to build up the networks of neurons that are going to fire when you do it. This means that every day, you will work those neurons a little bit more, and they will get a little bit stronger, until one day, this new neural network is so strong that it’s easy to fire it, and in fact, it might start firing on it’s own. At this point, you likely won’t even have to think much about that behavior anymore.
- If you want to read a bit more about changing behaviors around spending, check out #5 from my previous post about paying off my credit card, which talks about the process of behavioral change.
So that’s why you should actually feel good about being bad at budgeting. Every mistake you make is an opportunity to learn about yourself and your money habits, and every mistake will make you stronger and more successful in the future if you learn from it. So go ahead, suck at budgeting, and be proud of it, so that one day, you will be great!
Thank you for reading,