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12-29-2017 • New Year, New Budget Outlook

CONSIDER THIS: Sticking to a household budget is a New Year’s resolution easier made than accomplished.

Only 40 percent of Americans said they had a budget and kept close track of their spending this year, according to The National Foundation for Credit Counseling’s 2017 Consumer Financial Literacy Survey.

Everybody knows it’s important to track of personal finances. So why do Americans have such a difficult time maintaining a budget? Financial planning and psychology experts believe the real reason people struggle with budgeting is psychological. According to an article in the Journal of Consumer Psychology, humans only have a finite amount of willpower. We can only restrict ourselves so long before we indulge. Just like dieting, people tend to see budgeting as restrictive—and therefore they can’t build up the motivation to stick with it. There are ways, however, to overcome budgeting challenges. Here are a few:

If you don’t feel you have enough money, you could be spending money unnecessarily. Search the corners of your budget for spending that isn’t serving you. Many financial blogs offer creative tips to help with this.

If you don’t feel you have enough time, try finding a simple solution—like an app. Phone apps such as Wally and Mint track spending and income for you. They require minimum attention and time.

If you don’t feel you can get motivated, set some financial goals and understand that your budget will help you reach them. Make sure they’re not just practical goals—but ones that excite you! Maybe you’re saving toward a retirement abroad or just planning to reward yourself with a new outfit if you manage to kick that expensive coffee habit for a month. Make yourself realize that budgeting frees up your money so that it works better for you.

If you don’t feel confident, get some help. Apps, financial blog sites, and spreadsheets might help if you’re a little stuck in your budgeting process. But if you don’t even know where to start, consider seeking help from a trusted family member, a financial expert, or your financial institution. Many credit unions offer workshops and other educational materials to help you in this area.