Every month, I diligently write out our budget and track how we spend our money.
Most months we stay close to our target budget. However, there are some months, especially the winter months when we have a number of expenses due at once, where we struggle to make ends meet.
I’m sure you’ve experienced this as well.
If you struggle with your budget, you’re not alone. Turns out, there are many reasons why most of us spend more and save less than we should.
Here’s Why We Have So Much Trouble Sticking to Our Budget
1.) We’re Too Busy
My mom always tells me the story of my grandparents who constantly had to stretch to make ends meet. They would sit down together on Friday night with the grocery store ads and, based on what was on sale, make the grocery list and menu plan. Then, together, they would go to several stores to shop for groceries.
The whole idea of sitting down together as a couple to make a grocery list and then to shop together seems terribly quaint and outdated now.
I know of NO couples that do this today.
When my grandparents were able to afford a vacation with their large family (they had 9 children), they rented a cottage at the lake and had fun swimming. My grandma bought groceries and cooked every meal, even though they were on vacation.
In today’s busy, fast-paced world where often both parents have full-time jobs, we just don’t seem to have time to find ways to cut corners and do things ourselves. It’s much easier to go out to eat in a restaurant so someone else has to do the cooking.
Many of us, so limited on time, prefer to save time rather than save money.
By paying someone else to do things for us, from cutting our grass to delivering our groceries, to clean our homes, we gladly pay money so we can have more time. Yet we must work more to pay someone to do our tasks so we have more time.
It’s a vicious cycle.
2.) We As a Nation Have Lifestyle Inflation
Not only are we all busier, but as a society, we have experienced rapid lifestyle inflation.
Seventy-five years ago, people who had home phones were still sharing party lines with their neighbors. Televisions were still a rarity. In fact, in early 1948, there were only “102,000 TV sets in the United States” (Illinois Periodicals Online).
Of course, I’m not saying we should go back to the days of no television or home phone, though some people do choose to. Rather, take a look at all of the technology many of us have in our lives right now that we’re paying for that we didn’t have twenty five years ago:
- Home internet access,
- Smart phone, or at the very least, a cell phone,
- an iPad or eReader,
- apps for the smart phone or iPad,
- cable or satellite television with perhaps hundreds of stations
That is really just the beginning.
New technology is constantly being developed, and over time, we begin to think that we can’t live without this technology.
While smart phones and iPads are wonderful inventions, they cost us a lot of money every year. According to U.S. News, “Americans spend the equivalent of 17 percent of their monthly mortgage or rent on technology, according to a study by the American Institute of Certified Public Accounts released last year.”
That sort of spending can put a serious damper on your ability to stay within your budget.
3.) Friendships Can Be Expensive
Trying to stick to your budget, especially if it’s a tight one, can affect your friendships.
If you have friends who love to eat out and go to the theater or other fun places, you need to decide whether you want to stick to the budget or go out with your friends. Sure, you might try to ask friends over to your house, but some people really enjoy going out. If you can’t, they may likely find other people who can.
Even moms looking to form friends with other moms and have playdates with their kids can run into this problem. I find that more and more moms want to have play dates not at the park, which is free, but some place where the kids can do a structured activity. These types of parents prefer mom and me classes, My Gym classes, or other fun activities. All of those events, especially if you have more than one child, can add up quickly.
4.) Even Adults Are Affected by Peer Pressure
In addition to friends who might like to spend more, we also must learn how to handle family and friends who have more than we do. We like to think of peer pressure as something only teenagers and young adults are susceptible to, but the truth is, we’re all susceptible.
Dave Ramsey talks about sticking to his budget when he was getting out of debt and shares the story of an embarrassing beater car he drove to work. He was humiliated, but he stuck to the budget. Most of us wouldn’t make that kind of sacrifice, not when car loans are so readily available. It takes nerve and dedication to drive a beater car to work, especially when you’re past your teens and early twenties.
We may want just what our neighbors have without realizing that our neighbors may be deep in debt. By living like the neighbors, we often also experience the financial burden the neighbors have.
It’s no secret that millionaires are the ones most likely to avoid conforming to peer pressure. Warren Buffett has the money and the prestige to live in a mansion, but he lives in the same house he bought in 1958.
5.) We’re Marketed To Endlessly
Part of why we want so much more than previous generations is that we’re marketed to endlessly. Adults may be a bit more immune than children to television and print advertisements, but the advertising doesn’t end there. Many shows and movies today use product placement. The advertised product is embedded right into the show.
The Christian Science Monitor argues, “indirect selling by inserting products into a drama or a reality show can be annoying, distracting, and borders on subliminal advertising–something the Federal Communications Commission finds ‘contrary to the public interest.'” They argue further, “Producers should not violate a viewer’s expectation of a boundary between being entertained and being exploited. Without the usual clues of a ‘commercial break,’ a viewer is given no choice or warning.”
6.) Credit Cards Are Also Part of the Problem
Dave Ramsey argues that everyone who wants to stay out of debt and stay on a budget should pay in cash because you feel more pain when you’re forced to physically part with your money.
Yet very few of us do this, which can be a problem.
According to The New York Times, “Part of the reason so many people spend too much, or fail to stick to self-imposed budgets, is because parting with our money has become an abstraction in our increasingly cashless society. Credit cards provide immediate gratification, but no immediate consequences.”
Paying with credit cards is convenient. And the credit card companies entice us by offering cash back and travel rewards. Why should we pay cash when we can be earning rewards for using a credit card?
Paying with credit card doesn’t have to be a problem if you’re responsible with your spending and pay off your balance each month. Unfortunately, that’s something only a select few credit card users do.
7.) We Do Much Better with Immediate Gratification
Part of the attraction of using credit cards is that we get immediate gratification. There is no waiting and saving up for what we want; instead, we just buy it on the spot.
For most people, delaying spending to beef up the emergency fund is, well, just not fun.
Going out to eat, or shopping, or to the amusement park is much more fun.
As humans, we crave immediate gratification. Unfortunately, our society only encourages this immediate need for results. The New York Times compares sticking to a budget to dieting and states, “we often fail at both for the same reasons: too much focus on the restrictions, not enough on the fun. So it’s not surprising when people end up bingeing later, more than making up for the dollars not spent or calories not consumed.”
Final Words On Sticking to Our Budget
Of course, just because there are many reasons we humans find sticking to a budget difficult, doing so is not impossible.
Knowing the many reasons why we often overspend is the first step in learning to rein in our spending. Once we acknowledge the many ways society and our own minds lead us into spending more, we can develop a plan of attack to stop the money bleed and ultimately gain more control of our spending (and saving).