Biggest Mistake People Make When Budgeting

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Budgeting is a simple idea, but when it comes to the reality of it, it becomes a whole other story. Unfortunately, sometimes like gets a little tough. You never know whether or not there will be unexpected expenses or an inconsistent income. Therefore you need to be prepared for the unexpected when it comes to your finances.

The biggest mistake people often make is tracking what you spend on a day to day or week to week basis. Yeah it may help you see where you are spending your money, but the only issue with that is that tracking is not budgeting and only tells you what you have already spent, while budgeting allows you to set goals for your money so that you don’t spend it.

If you track your spendings, you end up putting little effort into staying within your budgeting expenses and you will also end up dipping into your savings and telling yourself that you are budgeting well. You need to sit down and figure out where your budgeting expenses are being under-funded and where you are over spending. You will then be able to create a working budget that will keep you on track.

With that being said, tracking is good but it isn’t entirely budgeting.

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