January 2024 Budgeting Recap


Mama Bear


a man holding a jar with a savings label on it
a man holding a jar with a savings label on it

Man oh man, those sinking fund envelopes took a hit this month! Between hosting guests twice (hello, extra mouths to feed!), and our two epic out-of-town adventures (fuel, hotels, dining out - the works!), let's just say our little bear had a blast (and our wallets, not so much ).

Honestly, I had a moment of "ugh, budget blues" there, but then I took a step back. Turns out, we just underestimated how much fun (and expensive!) this month would be. No regrets, though! Sometimes, creating memories is worth dipping into those savings a bit.

Now, the question is: how do we get those envelopes back on track? I'm glad you asked because of course, I have a plan. ;)

Overspending happens to the best of us, but it doesn't have to derail your financial goals. Here's a step-by-step guide to help you reset your budget and get back on track:

1. Acknowledge and Analyze:

  • Face the reality: Don't beat yourself up, but do acknowledge that you overspent.

  • Identify the reasons: Reflect on what triggered the overspending. Was it an unexpected expense, impulse purchases, or underestimating your expenses? Understanding the "why" helps prevent similar situations in the future.

2. Reconcile and Categorize:

  • Gather your receipts and bank statements: Track all your income and expenses for the previous month.

  • Categorize your spending: Divide your expenses into essential categories like rent/mortgage, groceries, utilities, and discretionary spending like entertainment, dining out, etc. Our mistake was being overly specific so try these more generalized categories until you get the hang of things.

3. Evaluate and Reassess:

  • Compare your actual spending to your budget: Identify areas where you went over budget and by how much.

  • Analyze your needs vs. wants: Are there areas where you can cut back on discretionary spending without significantly impacting your lifestyle?

4. Adjust and Adapt:

  • Revise your budget: Based on your analysis, adjust your budget allocations for the coming month. Be realistic and allocate more towards essential categories if needed.

  • Consider a temporary spending freeze: This can help you stay within your new budget and recoup some lost ground.

5. Set SMART Goals:

  • Set Specific, Measurable, Achievable, Relevant, and Time-bound goals: Aim to save a certain amount each month, pay off specific debts, or create a buffer for unexpected expenses.

6. Implement New Strategies:

  • Track your spending daily: Use budgeting apps or spreadsheets to monitor your expenses closely.

  • Plan your meals and groceries: Avoid impulse purchases at the supermarket.

  • Seek support: Don't be afraid to ask for help from a financial advisor or get your partner involved, it helps with accountability.

Additional Tips:

  • Don't try to fix everything at once. Start with small, manageable changes and gradually build on your progress.

  • Celebrate small wins. Reward yourself for sticking to your budget to stay motivated.

  • Remember, setbacks are normal. Don't get discouraged if you slip up; just get back on track and keep moving forward.

By following these steps and focusing on positive change, you can effectively reset your budget and achieve your financial goals. Remember, consistency is key. Stick to your plan, make adjustments as needed, and you'll be well on your way to financial stability.