When I created my budget several months ago, I did so to limit my spending. I wanted to avoid spending too much money on clothing, groceries, entertainment, etc. By tracking it as the month progressed, I could see where I needed to cut back and where I was doing well.
I came to the point where I was comfortable with my budget, but there was still a huge problem. I was cutting back too much in categories I didn’t want to cut back on. I got so obsessed with saving that I wasn’t allotting myself enough money for certain things that I should have. One month I had a low grocery bill, so I responding by lowering my budget for groceries for the future. I was able to do it, but not with the quality of life I was looking for. I knew I could save more for the future, but I wasn’t happy with my present quality of life, so I looked for a way to fix my problem.
Besides limiting spending, budgets can actually promote it, too. With my budget, I know I have $100 a month to spend on entertainment, and when I see on the 15th of the month I have only spent $20, I make sure to spend more on something that will make me happy, maybe by taking Lauren (my girlfriend) out to a movie, dinner, etc. I try not to waste it on impulse buys, but I want to make sure I’m enjoying myself rather than skimping out on the things that make me happy.
The same goes with groceries. Instead of trying to save too much, I make sure that I buy fruits and vegetables and get ingredients to make halfway decent dinners. Having just graduated college, I am used to pasta, bagels, rice, and potatoes as my main sources of protein (what? those foods aren’t full of protein!??), but now I am trying to enjoy a healthier lifestyle and that means dishing out a little more for quality food. I budgeted for it, I can afford it, so why not be healthy while still saving 50% of my pay?
How do you make sure to spend enough in categories that matter?