Blown your budget? Get back on track!

You have planned out a spending budget with the intention to improve your finances, but something happened and you overspent. Try not to let financial stress add tension to the situation. Take the following steps to get your finances back on track:

Make an assessment of what happened

Find out what happened that caused your carefully-planned budget to get derailed. Was it only one thing, or a combination of many factors like multiple impulse buys and emergency expenses? Once you figure this out, you can make a more informed decision on how to make up for the overspent amount as well as avoid getting into the same mess in future.

Temporarily cut back on spending

To make up for the amount you overspent, you may need to temporarily cut back on certain items or activities until you get back on track. For instance, you could cook every day to avoid the additional expenses of eating out, or cancel entertainment plans for a month.

Have a flexible emergency fund

Put aside some money each month solely for emergency expenses, separate from your long-term savings account. This is so you’ll have some buffer in case you need cash urgently and won’t have to bust your budget covering the costs.

Track your progress with budgeting apps

Tracking your spending is often the first step in getting your finances in order. By understanding what you spend money on and how much you spend, you can see exactly where your cash is going and areas where you can cut back. Try to use a budgeting app to help you, such as Mint or Personal Capital.

Know your full financial picture with MyCTOS Score report

In addition to tracking your spending and using apps that show your full financial picture, start tracking your credit score through MyCTOS Score report to see how your credit management habits pay off, too. For instance, you can track how your creditworthiness shifts over time as you pay down debt and continue making on-time payments. In turn, you may qualify for better lending rates and terms when you need to borrow money.