Do You Want Budget Chaos? Spend Miscellaneous-ly!
I’m Still Struggling with My Budget, Specifically the Miscellaneous Category.
How many of you have a miscellaneous category in your budget? We do, and it seemed to always cause us trouble. We always put money in our budget for miscellaneous items, but that category always seemed to go over. Every. Single. Month.
So what can we do? How do we solve the problem of the miscellaneous budget category? When we were cutting our budget during the multiple setbacks we had last year, this was one of the key budget categories we solved.
In our budget there were two categories that we’ve had issues with over spending. I’ve already written about one of the budget categories: the grocery spending.
The other category is . . . obviously the miscellaneous budget category. So we’ve been able to corral our miscellaneous spending, and I’ll let you in on how we did it.
But first let’s talk about the word “miscellaneous”. It’s basically means a hodgepodge of items or things that don’t fit anywhere else.
And when it comes to your finances this budget category is no different. It’s sort of like a catch-all for your odds and ends.
Don’t know how to categorize those light-bulbs you needed? – Miscellaneous. What about the dog food you bought the other day? – Miscellaneous. And the extra napkins and plates you bought for the recent barbecue? You guessed it! – Miscellaneous.
Define the Other Categories Better.
The first thing we did is better define the other categories in our budget. Instead of having a few general budget categories, like food, shelter, transportation, and debt, we break it down a little better.
For instance, instead of food, try “dining out”, “pet food”, and “groceries”. Then put smaller amounts in each new category that add up to the old “food” amount.
For shelter, try “rent/mortgage”, “insurance”, “utilities”, and “maintenance”. And so on. When you can categorize your spends more specifically, you end up with an overall better plan. You may also find some new areas where you can save money. All because you can’t just lump all your food related items into one big category.
If you don’t plan well, what normally happens is you run out of budgeted money before the month or week ends. And there are still things that you need. It’s not that you didn’t try to plan and budget, you just weren’t specific enough.
The solution is: don’t be vague with your money. Spend on purpose. Dave Ramsey says to “be intentional with your money”.
The goal is not necessarily to make more work for yourself. It’s to plan better. Because it’s easy to spend more than you were intending when everything gets lumped together in a few categories.
Limit the Excess Spending
Often when we find ourselves over spending in the miscellaneous category, it’s because we didn’t budget for that expense in the first place. And since there is no other category with excess money, it seems to fall in the “misc” category. Whether by accident or not. If we were intentional with our money, some of those un-budgeted expenses wouldn’t be purchased in the first place.
It really is this simple. If you didn’t plan it, Don’t Buy It! So before the month begins, do your very best to plan your expenses. You should be basing your budget on your previous spending, so it should be close. And if something extra comes up, you either don’t buy it, or if it truly needed, you can take it out of your emergency fund. Or even better, you can wait and plan it into next month’s budget.
If you’re anything like me, you won’t want to dip into your emergency fund just for something that “came up”. My guess is, it won’t be a true emergency, and you shouldn’t buy it in the first place.
So, make your budget specific, and categorize your spending better. Make more categories if you have to. And be intentional with your spending. Only buy something if you’ve planned for it.
It may sound like more work, but it doesn’t have to be a permanent change. Once you’ve restored control of your spending, then you can ease back on the specificity. It’s all about building good spending habits. And once you’ve established those habits, you can continue them without the forced budget structure.
But you first have to develop those habits. So how are you doing?
Are you over-spending as a result of vague budget categories?
Let me know in the comments and thanks for reading and sharing. It’s much appreciated.