How to Plug the Leaks in Your Budget

Drip Goes the Faucet
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Do you have any leaks in your budget? If you are consistently wondering where you money is going, and why you seem to run out during the month, you may have a spending leak. It is important to find the leak and plug it so that your money doesn’t just disappear each month. Finding the leaks can help you stop dipping into your savings each month. Everyone has different leaks, and you may be surprised at what your major leak is. 

Difficulty: Easy

Time Required: A few hours

Here's How:

  1. Track Your Spending: First, you need to track your spending habits to find out where the budget leak is. It is a simple process. Simply write down everything that you spend over the period of a month. If you use a financial software program, you should be able to run a report of what you have spent in the last month, which will allow you see what categories you have spent the most on each month. Using a good budgeting system such as budgeting software can make this step easier.
  2. Compare: Next, you should compare the amount that you have spent each month to the amount that you have budgeted. If you find you have great discrepancies, you have found your budget leak. You need to ask yourself if the amounts in your budget are realistic or not. For example, you may find that you need to raise the amount in your grocery budget or the amount you spend on gasoline each month.
  3. Analyze: Then, you should ask yourself why you are overspending in that category each month. Finding the reason for the budget leak will help you fix it. For example, you may not have enough money to cover the rising cost of gas and groceries. Or you may overspend on the weekends when you go shopping with your friends, and buy stuff even when you are not planning on it. You may find that the drink from the convenience store on the way home from work each day adds up, and you don’t have a budget category for it.
  4. Evaluate: Ask yourself how you can stop the budget leak. It may be that you need to adjust your budget to allow for the higher amount or you may need to change your habits and find other ways to spend your time. You should look at the reasons that you spend the money and consider how your choices are affecting your long-term financial goals.
  5. Commit: Commit to your new plan, and continue to track your expenses. Take time at the end of the month to see if your spending habits have changed and how they affected your budget. If your spending habits have improved, great. If not you will need to take the time to assess your habits again and make more drastic changes to get your budget under control. You can also adjust your tax withholdings to find extra money for your budget.


  1. Consider switching to cash only in any categories that are problematic. Once you have spent the amount you have set aside for the month, you simply stop spending the money. This will help you to stick to your budget. You can also consider using Google wallet to cover problem categories. These five budget hacks can help make budgeting easier. It can help you stop blowing your budgeting and then struggling the rest of the month to make ends meet. 
  2. Look at these five areas that many people neglect to put in their budget.
  3. Make sure you still allow for a few splurges in your budget. It makes sticking to the rest of it easier. It can help you from making one of the biggest budgeting mistakes. You may also be wasting money each month without realizing. See if you are doing any of these five things to see if you can save even more.
  4. Also examining your annual budget can let you see a bigger spending problem or weakness. If you have been budgeting for at least six months, you should look at category spending reports to see which categories jump out at you with your spending habits. Taking the time to examine your financial habits can make a big difference in how successful you are at sticking to your budget.
  5. If you have a serious spending issue, you may need to seek help through a counselor or support group.
  6. You may also want to try some of these budget fixes to make your budget work. You can start cleaning up your finances today by taking a few simple steps. 

What You Need:

  • Receipts from the last month
  • Budget
  • Calculator
  • A notebook and paper