Isn’t it interesting how when a new year (whether a financial or calendar year) begins, a person turns into a budget planner? Generally everyone sets out with new financial goals which usually involve spending less and earning more. As with many New Year’s resolutions however, new habits quickly go south and we fall back into our old habits. The question then looms: Why is sticking to a budget a difficult thing to do? Also what can be done differently this year so that it becomes the year you not only make a plan, but stick to it?

First let’s tackle the problem of why we can’t stick to our budget. If you are brutally honest, the number one reason is because it’s not that important to you. Generally speaking whenever you make something a high priority, you tend to stick with it. When it comes to budgeting it has to be high on your priority list. You have to find a reason why it is so important that it will force you to stay on track.

With that problem solved what are some other hindrances? Most of the other hindrances have nothing to do with desire but with your approach to budgeting. Let’s face it; there is nothing glamorous or exciting about making a budget. Tell your friends you are doing your budget and the response is usually “Oh, ok.” Just the word alone makes people feel like they are being restricted or sacrificing something. Even though this may be true it shouldn’t be the way you approach budgeting, because it gives you a negative emotion towards it. To be an effective budget planner you have to turn that negative into a positive and here are some simple ways to do that.

Create a long term and short term financial target. If your goal is to save ten thousand dollars you have to be realistic, and realise that it won’t happen overnight. If you wait until you have reached this amount, you most likely will get frustrated along the way. However if you put certain shorter smaller targets along the way, say at $2,500, $5,000 and $7,500, you create excitement about reaching your goal and it keeps you motivated to stay on course.

Don’t be afraid to make adjustments! The word budget implies inflexibility to most people and that doesn’t keep you motivated. It is important to build allowances for change into your planning. Things may happen from month to month that will force you to make decisions that will take you away from your plan. That is ok! Adjustments are fine as long as you continue moving towards your goal.

It’s important to allow for some fun; when you are working you want to enjoy the fruits of your labour, and even if you are on a budget that desire doesn’t go away. It’s ok to indulge and have some fun while you are budgeting, you can reward yourself for each target you hit. If you are paying off debt, set a goal that when you have eliminated a certain amount you will do something fun that you really like. This keeps you motivated but rewards good behaviour. For children we call this positive reinforcement, but it works for adults as well!

So if you have set out to be a budget planner this financial year, don’t forget to take the right approach, make it a positive experience and have fun along the way. After all, though your budget may feel restrictive today, it will one day set you free.