Why You Can’t Budget Money + How To Organize Your Finances

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I have 2 questions for you.

There’s just one rule: answer in less than 30 seconds.

  1. How much is your electric bill (on average)?
  2. How many credit cards do you have?

Were you able to answer them in time?

Be honest now!

Why do I ask?

Most people don’t pay close attention to their money–if any.

And, many people are so disorganized they don’t even know how many accounts they have, much less how much they have or owe across them all.

Both of those situations are problematic because they can lead to future money trouble.

Honestly, I didn’t expect you to be able to answer.

I just wanted to get you thinking.

So now that you have budgeting failures and financial organization on your mind, let’s take a look at what can be holding you back from being able to budget and what you can do to get your financial house in order.

4 Reasons Why You Fail At Budgeting Money

Create a budget!

Three simple words; something every personal finance site advises.

In that case, it should be easy, right?

Apparently, it’s not.

I can’t budget.

Three more simple words; something most people looking for money help say.

For some people, it’s like quitting smoking: they try over and over and over again.

Sometimes it’ll stick for a while, but mostly it’s without sustained success.

They’ll try this person’s spreadsheet.

They’ll try that person’s recommended budgeting app.

They’ll try anything that someone writes about on a blog or talks about on social media but many people still fail to budget.

Even to the point of giving up entirely.


There are 4 simple reasons why you fail at budgeting your money.

You Don’t Want To Budget

There are tutorials on how to create a budget on a number of sites and people going into deep discussions on the benefits of budgets.

Of course, there are also tales of attempt after failed attempt leading to nothing but exacerbation and eventually giving up on the task entirely.

It may seem like the two aren’t connecting, but that’s far from the case.

The reason why people have trouble budgeting comes down to one reason…

If you’ve ever planned a party with a set amount of money to spend (birthday, wedding, anniversary), you have budgeted.

You don’t want to!

Anyone can develop a budget.

If you have ever made a shopping list with a limit on it, you have budgeted.

All it really takes is the ability to read and write.

Making the budget, for the most part, is the easy step.

All it really entails is tracking all of your income and regular expenses.

You’re just writing down words and the numbers allocated to each one.

The income numbers come right from your payroll check if you are an employee, or from your accounting software if you are self-employed.

The expenses you can get right from your checkbook or bank/credit card statement, as most of them are recurring and generally the same.

That leaves the odds and ends–the entertainment and commuting, clothing, maintenance, etc.

It may be a little difficult at first, but these are the categories that you are going to be allocating estimates to so you don’t need to be exact with them.

So where is the part that people don’t want to do?

Sticking To A Budget Is Hard

Making the budget is easy.

It’s just numbers taken from the historical data that is your life.

Making the necessary lifestyle changes to stay within those budgeted amounts is where most people fail to follow through.

Where most people get tripped up is sticking to the allocations for spending.

They fail in adjusting their spending habits to stay within their budgeted amounts for certain expense categories.

The truth is, many people are unwilling to make the sacrifices to adapt and change the way they live and manage their money.

Don’t worry, you aren’t alone if this describes you.

Many of us are guilty of this.

We have all become accustomed to certain lifestyles, and change is not something that most people handle very well.

And it may not even be your own fault.

The reasons vary, but most typically include:

  • The way they were brought up–either coming from money or from homes in which the parents lived beyond their means–never having a solid financial foundation
  • The way they lived in their “bachelor/bachelorette” years–free-spending, not a care in the world–getting too used to it and not wanting to grow up
  • The way they live now–worrying about keeping up appearances–worrying about what others think
  • Even the misunderstanding of getting cash back from Rakuten or credit cards still costs money and isn’t “making money”

Nobody wants to give up their new, expensive car for a used practical car.

Nobody wants to go from dining on lobster and filet mignon to hot dogs and canned beans.

Nobody wants to go from staying at the Ritz Carlton to the Holiday Inn on vacations or even cutting them out completely.

Unless you’re serious about changing your money habits that is!

If you really want to change for the better you’ll do those “unthinkables”.

You Can Budget When You Want

I present to you: Black Friday & Red Thursday.

Imagine, if you will if everyone put even a fraction of the energy and dedication into planning everyday finances as they do when going into these two shopping days.

How many people would be in a lot less trouble than they are today?

Just think of the people you know personally.

Like managing finances, this huge shopping event takes planning, which begs the question:

Why can people plan for Black Friday but claim to be unable to plan and budget their normal finances?

It takes time to plan the schedule for the day of shopping:

  • Coordinating schedules
  • Finding someone to watch the kids
  • Planning out the travel and shopping routes
  • Figuring out which are the best places and arranging the day accordingly.

It takes commitment to sit out in front of a store for hours or even days to ensure getting the best deals.

Heck, it takes a crazy amount of patience and commitment to wait on grocery checkout lines–even if you are saving a ton like at Aldi stores!

Now if that kind of time and dedication was put into setting up and following a budget for things like…

…many people would be in a much better position than they are right now.

Even the holiday shopping season would be easier if more time and effort were used for planning and budgeting for it.

Higher-yielding online savings accounts or even certificates of deposit could provide a buffer and interest earned can be used to offset some of the costs.

Store loyalty programs can be used to gain even more savings.

Truth be told, many people are perfectly capable of making sacrifices in order to reach what they claim to be their “goals”.

Unfortunately, as evidenced by the amount of time and effort that goes into planning and budgeting for Black Friday, people are simply too lazy or just do not care enough to commit the same type of effort into their everyday finances.

Budgeting Isn’t Sexy Or Exciting

Some people can’t get into things that don’t excite or entertain them.

Budgeting is far from sexy (Even though I know a certain blogger who would disagree hahaha).

It’s far from exciting.

It’s not going to keep the average person’s attention for very long–sorry money nerds, it’s true that it’s mostly you who enjoy and get goosebumps for budgets and spreadsheets!

But then you have something like fantasy football or fantasy baseball.

That shit is nuts!

You have people with whiteboards, and printouts, and calculations.

They sit for hours just talking about it.

All just to put together a make-believe sports team.

But guess what?

That’s exactly what budgeting is my friends!

Playing fantasy sports is spending time trying to figure out the best way to spend your salary cap money across multiple positions.


  • Salary cap = total monthly income
  • Positions/players = household expenses

It is literally the same exact thing just in a form that matches something you enjoy, but the same nonetheless.

So if you participate in fantasy sports with salary cap limitations, then you have absolutely zero excuses for not being able to make a budget for your real money.

Perhaps It’s Psychological

It’s difficult to find areas to cut back on when you are so used to–and comfortable with–how you were previously spending your money.

Wants often times get confused with needs when you’re used to living a certain way.

It can be difficult to break long-standing habits or learn the proper way to do things when you’ve been doing them wrong for so long.

Sometimes it’s easier to simply throw in the towel and give up because it’s too difficult to change.

That is just an excuse.

It’s certainly not a reason why you cannot execute a budget.

Again, we’ve all been there before.

Sometimes it is necessary to throw everything we thought we knew out the window and start learning how to handle money all over again, the right way.

Or, you can just keep living your life the way you have been, never making any headway and never getting ahead.

3 Easy Steps To Organize Your Finances

Glass jars labeled with savings goals--travel, charity, house fund, savings--stacked in a pyramid on a table with hundred dollar bills inside

Being organized isn’t a strong suit for many people.

I’m not talking just about money either.

  • Closets
  • Garage
  • Pantry
  • Office
  • Sock/Underwear drawers

People just have trouble keeping things sorted.

I bet one of the more common complaints people have when it comes to their finances is being able to keep everything organized: keeping track of receipts and bank statements to be specific.

One of the main causes that I have encountered in my career as an accountant is the attitude that more is better when it comes to accounts: the more interest-bearing and investment accounts, as well as credit cards people have, the more wealthy they feel.

However, this is a big mistake in many cases.

It can lead to certain problems like having trouble budgeting, keeping track of expenditures, and even preparing to have their income tax return prepared.

But there is hope for all you organizationally challenged folks out there, and it’s quite easy to implement.

In fact, you can do it in 3 easy steps…

Consolidate Your Accounts

The fact that banks tend to reward people for bringing in new money contributes to the confusion.

It makes things worse for some people, as it creates yet more paperwork.

That and another chance to mess things up.

In some cases, people open up different accounts to serve different purposes:

  • Household checking and savings
  • Vacation fund
  • Holiday fund
  • Emergency fund
  • Repair account

This type of segregation may be good for planning purposes.

It is, however, a killer in terms of keeping track of all the money.

Then you have brokerage accounts: a 401(k) with the employer’s broker, an IRA at a different broker, and a separate taxable investing account.

Not to mention credit cards.

I had one particular client last month who had 1099-INT statements from 27 different financial institutions.


That is ridiculous for one person or family to have unless they have so much cash that they need to separate their cash accounts because of FDIC limits.

But, if that doesn’t describe you, then start closing accounts now.

Keep a household checking account to cover the everyday expenses and recurring bills, a savings account, and maybe another interest-bearing account for short-term planning like trips and gifts.

If you have more than one IRA or multiple taxable brokerage accounts, transfer everything into just one for each type.

There really is no need to have multiple accounts, and at different brokerages, unless you are a serious trader and each brokerage is better than others at dealing with certain kinds of investment types.

And for those who use multiple credit cards, get rid of all but 2 or 3 if you are worried about your credit score, but if you can care less about that, then close all but one to make things easier on yourself.

Take it a step further

If you really want to get crazily organized, sign up for electronic statements and confirmations.

This way you only get an email whenever a document is issued, and have no papers to have piled up in all areas of your home.

You can create a hierarchy of folders and save all of the PDFs for easy access when the time comes and it is much easier and quicker than fumbling with papers.

One thing you should always have separate is a “cash stash” especially if you live in an area that is subject to hurricane season.

Welcome To The Electronic Age

Almost everyone has a computer these days, so why not take advantage of this amazingly useful tool?

Set yourself up with a QuickBooks Online subscription or sign up with Digit or whatever other apps you prefer to use.

These programs are very powerful tools for tracking your money, generating budgets, automating the checkbook balancing process (and there are plenty of people who need help with that task).

You can not only automatically download transactions, which will alleviate much of the stress involved in managing finances, but you can even scan receipts and attach them to transactions, keeping everything in one place.

A lot of people use Excel as a means to track and reconcile accounts, but if you don’t have the advanced knowledge of the program, you really will not get the most benefit from it.

And, needless to say, if you are still using paper and a pencil, then you really have your work cut out for you.

Computer-based programs take much of the hassle out of recording, reconciling, tracking, and reporting.

In addition, you can also schedule recurring bills and/or deposits to be automatically entered into the registers so that even without updating your accounts, you will have a more accurate view of the balances.

It may cost a little bit of money depending on which option you decide to go with, but the time savings will more than make up for the cash expenditure.

Besides that, you can track not only personal finances but business finances as well, with the same program in many cases.

Take it a step further

You can get really coordinated by using an online version of personal finance software, so you will be able to update it from anywhere.

Or, you can incorporate a service such as Evernote which is a free notation product by which you can synchronize notes between your smartphone, desktop, or web-based access.

Simply create notes for transactions you need to record at a later time, then when that time comes, you will have records that are as detailed as you would like in order to track your finances at any time, from anywhere.

Make A Date, Don’t Be Late

In the beginning, getting your programs populated and caught up may take a little bit of time and work.

But, once you are up to speed, you should definitely set a schedule for sitting down and maintaining your records.

Every day would be the most ideal, but that may not be very convenient.

You should try to set aside a little time on a weekly basis at the very least, at a time when you know that you generally have nothing else going on so that you can commit to that time period regularly.

After a few times, you will start getting used to that routine and it will become almost second nature.

Try not to miss any of those scheduled times so you are always up-to-date, and watch all of your finances fall right into place.

Take it a step further

Get other family members involved.

If you have kids, let them set up their own files so they can learn the importance of keeping tabs on where the money comes from and where it goes.

Nothing will help a child become financially responsible like learning the value of money and how to manage it from a young age.

It may also teach them to keep things orderly in other areas of life, so maybe you won’t have to continually tell them to clean up their room(s) hahaha!

There you go, 3 simple steps to getting more organized financially.

If you needed yet another reason to get organized, it also can help protect you against becoming a victim of identity theft.

That alone should give you the kick in the pants to get organized!

Following this guide will help you in having a better understanding of your personal financial picture, and may even help you sleep at night knowing that everything is in its place.

And you can spend less time worrying about being in disarray and concentrating on other, hopefully, more enjoyable pursuits.

Your Turn

Do you have a strict, detailed budget that you stick to religiously? Or do you just have an idea in your head of what your budget is? How organized are you when it comes to your household finances? Do you have so many accounts that you don’t even know what’s where?


One Comment

  1. Yup, just a different take on the saying “failing to plan is planning to fail”.

    It’s an accountability issue for the most part–like you said, if you’re not happy, do something to improve your situation, don’t bitch and moan and blame others for your failings.

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