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11 Most Common Budgeting Mistakes

The current stay of the economy has forced everyone to tighten up their wallet and spend wisely. One of the key tools to ensure you keep stacking $ is to budget properly. All too often we go into the budgeting process with high hopes, but lack the discipline to stay the course. Well… it is staying the course that will keep you out of the poor house. Here are some tips that I came across that might be helpful towards getting your budget game in order. -!YG

Note:

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Not Planning for Yearly Expenses
You plan for typical ongoing bills expenses: groceries, utilities and gasoline. But oops, you forget about yearly expenses, like car insurance and property taxes. For planning purposes, simply divide yearly lump sums by 12 and allocate that amount for annual expenses every month.

Yes, it’s easy to forget about bills that don’t show up at your door every month, but you’re probably better off paying the total bill at once, since most companies levy an extra charge for monthly payments. Remember to also plan for other non-monthly expenses, like school supplies, pet careÂ and gifts. (The tips in Holiday Spending Or Spending Holiday? will have you singing “Joy to the World” well into the New Year.)
Not Expecting the Unexpected
Many people don’t set aside money for medical expenses, car repairs and home maintenance. But are these so-called irregular costs really unexpected? Almost all cars and homes eventually need repairs. The amount of repairs depends on age, quality of construction and maintenance.

Sure, unexpected breakdowns happen. But you can predict some costs, at least roughly. When shingles on your 25-year-old roof with a 25-year-warranty are curling up, it’s time to start setting aside money. Save money by shopping around and getting quotes, instead of hiring the first contractor who returns a call. (Be prepared before you buy – learn the basics in Used Car Shopping: How To Avoid A Lemon.)
Not Tracking Past Expenses
A good way to get a handle on irregular expenses is look at past expenses. How often you went to the doctor or mechanic last year can indicate how much you’ll go next year. Plus, some costs are seasonal. Gas and oil bills are higher in the winter, and electric bills are frequently higher in the summer when air conditioners run.