Are You Drifting From Your Financial Plan?

financial plan

Principles. They’re all that hold us back from making huge financial mistakes, and sometimes the lines can get blurred. That happened to us. We’re not sure exactly how our principles were compromised, but we know that it happened slowly and over time. I hope to make this article as transparent as possible, because I know that if we’re struggling with this issue, surely others must be as well.

Our Mistake

My wife and I noticed that we started moving money between budgeting categories a few months ago, and it got to the point where we are transferring funds from mandatory categories (like medical and transportation) to discretionary categories (like fun money and date money). That’s not good at all! We slightly drifted from our financial plan, but were thankfully able to recognize it before it got too out of control.

We believe that instead of transferring funds mid-month, we should’ve rebalanced the budget for the next month to reflect more realistic spending. Our date money category was underfunded, and it caused us to overspend other categories. So, we got smart and raised how much money we allow for dates and reduced other spending so that we have the same overall monthly expenditures.

How To Determine If You’re Drifting

It’s usually not a crash and burn scenario. Falling off your financial track happens slowly over time. It’s more like drifting. That’s why it can go unnoticed for months, years, or even a lifetime. There are a handful of ways to determine whether you’re drifting from your original principles. Here are some tips to make sure you’re holding true to your financial goals:

  • Adopt humility. This is a big one. You’re never going to recognize a problem if you don’t humble yourself. Pride at its very core is evil, and will blind you to the truth about how you’re living. That goes for you, me, and everyone else.
  • Submerge yourself in financial planning. The next step is to ensure you’re getting your daily dose of good sense. You can start by subscribing to financial blogs, listening to podcasts, and reading a lot of good books!
  • Do a monthly review. Causally checking on yourself doesn’t work. You need to be intentional about making sure you’re on the right path. I recommend sitting down once a month to do a review of your finances. Have a real brainstorming session to determine if you’re on the straight and narrow. Doing this with your spouse will ensure that you’re both held accountable.
  • Keep accountability. It helps tremendously to have a friend or family member make sure you are holding to your principles. Find somebody that isn’t afraid to tell you the truth in love.

Never Give Up

I’ve found that when people first start changing their money habits if they make any mistake whatsoever they often feel like giving up. They think the task is too difficult. I encourage those of you who are feeling this way to not give up. Never give up! So many things in your life depend on your ability to win with money. It’s worth the time and effort to struggle through financial concepts, creating a plan that lasts, and persevering when the path gets rough.

Build A Solid Financial Plan

I recently wrote a series on Dave Ramsey’s 7 Baby Steps. I haven’t found a better long term financial plan than Dave Ramsey’s. Not only is it well thought out, but countless people have successfully used it. I highly recommend that you apply his plan to get yourself where you want to be. The approach is conservative yet powerful. It’s not a get-rich-quick scheme, it’s something that takes a number of years. I might go as far as saying it’s a lifestyle.

Inevitably, you’re probably thinking of a few areas where you need work. I know I am. We’d love to hear from you! What areas are you struggling with, and how do you plan on getting on the right track? Let us know in the comments!

Photo by BrentOzar

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  1. Richard

    Good read. It’s hard staying disciplined to our financial plan. It’s so easy to eat out a couple of extra times a month or go out more than we’d planned.
    I actually keep a separate free checking account for “fun” money that has a set amount automatically transfered to it. That way, it’s a lot harder to over spend from the fun account. If the balance hits zero, that’s it for the month.

  2. Curtis Andrew

    Thanks for the article John.

    It reminds of so many people that refinance their house to pay off credit cards only to build up the credit card debt again. Usually they start off good, but then they start to drift – and the more you drift, the easier it gets.

    I found your suggestions on point. My wife and I found that the monthly review was the most important thing to keep us track with our budget. Without a routine checkup all your other efforts may go in vain.

  3. Briana @ GBR

    Although I keep most of my notes on my computer, I think I would need to physically hold in my hand my financial health (bills, budget, etc.) Do you recommend keeping a file and doing a check monthly?

  4. Rob Ward

    We make mistakes with our budget every month, but that doesn’t mean we stop budgeting! Thanks for the encouragement John.

  5. Khaleef @ KNS Financial

    Humility is such a key! If we aren’t willing to acknowledge that we have made mistakes, then we will not be able to perform a proper examination of our finances!