There are few downsides to consider when you decide to create a personal budget. It allows you to manage your income and expenses better over the course of a month or year. It helps you save money and pay off your debt more aggressively. However, you do have to prepare for a few possible challenges when you make the decision to create and follow a personal budget.
When you have a personal budget, you must discipline yourself to make difficult and sometimes unfamiliar choices in your life. For instance, if you find that your entertainment budget is too high, you must adjust your lifestyle to reduce that cost. That might mean spending less time entertaining yourself or visiting less expensive places. It often takes time and patience to change your bad spending habits, but it comes with rewards. As personal-finance writer Liz Pulliam Weston states, "Taking responsibility for our choices can be scary, but it should also be empowering."
Another disadvantage of having a personal budget is the time requirement. You must spend a significant amount of time creating and managing your budget plan. It takes time to create a budget spreadsheet and list all of your bills and obligations. You must take the time to make entries and modifications to your budget on a regular basis as well. Before making any major purchases, you must consult your budget. You also have to monitor your bank accounts by calling into the bank's phone system or accessing your account details online.
Getting Others to Understand
When you have a personal budget, you are not the only person it affects. You have to get family members and friends on board with your new plans as well. Your spouse and kids may have habits that fall outside of your budget, so you have to convince them to change those behaviors. Your friends may want to visit expensive restaurants or shop for items you cannot afford. You have to convince them to start going to more affordable places. Changing the behaviors and opinions of others to go along with your new budget is a challenge.