382. The 10 Budget Busters That Quietly Destroy Your Money

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If you’ve ever made a budget and felt great about it, only to watch it fall apart, this episode is for you.

Budgets don’t fail because you don’t care. They fail because of sneaky habits that quietly drain your money month after month.

In this episode, Brad breaks down the top 10 budget busters he’s seen over the last decade — and how to fix them without making your life miserable.

Transcript

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Why Budgets Fall Apart

Brad Nelson 0:00

Hey, if you've ever made a budget and you felt really good about it, but then you've watched it slowly fall apart, this episode is going to be for you. You see, most budgets don't fail because people don't care or they don't try hard enough. They fail because of a few sneaky habits that quietly blow up their budgets. And today I'm going to walk you through the top 10 budget busters, at least that I've seen over the last 10 years, and hopefully try to help you fix them without making your life completely miserable.

Announcer 0:33

You're listening to the Debt Free Dad podcast with Brad Nelson. Brad and his co-hosts experience the anxiety of living paycheck to paycheck before learning the fundamentals of financial success. They are now on a mission to empower regular people to pay off their debt for good and enjoy happier, less stressful lives. Keep listening for inspirational interviews, tips, tricks, and practical advice to gain financial freedom.

Brad’s Story And Mission

Speaker 1 1:01

Welcome to today's show. My name is Brad Nelson. I'm the founder of Debt Free Dad. I paid off about $45,000 of debt. I've been debt-free now for more than 12 years. I've also been fortunate to help thousands of other people save and pay off tens of millions of dollars with the work that we do here at Debt Free Dad.

Free Resources Teaser

Speaker 1 1:17

Now, after listening to this episode, if you're someone who is ready to take things to the next level, you want to break free from living paycheck to paycheck, you want to reduce financial stress, build your savings, finally pay off your debt for good. But maybe you're like a lot of people. Heck, it might be why you're listening to the show. You're not sure where to get started. Well, we've created some incredible free resources to help you get there. And I'll be sharing some details about how you can get some of those later on in today's episode.

The Slow Creep Of Budget Leaks

Speaker 1 1:43

Now, let me ask you something. Have you ever felt like you know what you're supposed to be doing with your money or you create that perfect budget? But somehow that budget just keeps getting blown up month after month. And again, maybe not in some big dramatic ways, although that does happen from time to time, but it usually is in a hundred little ways, right? You start the month feeling motivated. You know, you're gonna make a plan. You tell yourself, this is the month, we're gonna do it, I've got it. And then guess what? Life, right? Life happens. It's that dinner out where you talked yourself into going out to eat rather than cooking at home, even though you know you have food at home, right? There's that random purchase, that emotional purchase maybe you made or impulsive purchase. It might have been a bill you forgot about, forgot to put in your budget. Something breaks, flat tired on the car, got to come up with money for that. It's just always something, right? And suddenly your plan and your budget, it begins to feel almost pointless. And again, it's not because you're being reckless or you're being irresponsible or you're not trying, but your budget still feels like it's this fragile thing, and you're just never gonna get it. So, today what I want to do is I want to talk about the top 10 budget busters. And again, these are sneaky little budget busters, these are patterns, blind spots that tend to wreck a lot of people's budgets, including myself at one time. And more importantly, I want to share just a few ideas of how to fix them. And mostly a lot of how you're gonna fix them is just becoming more aware of them. And again, these are the top 10 that we see on a regular basis. So keep an eye on these things when you're going through your budget. If you're finding that your budget is constantly, you know, in the red and it's not working out, this is a great place for you to start. Because the reality is if you can eliminate just a few of these, your financial life gets easier, right? Budgeting becomes easier, you start to see a lot more success, and you'll become a lot more confident. Now, again, keep in mind when it comes to budgeting, you don't need perfection. You just need to know where to look.

Impulse Spending And The 24-Hour Rule

Speaker 1 3:46

So let's talk about number one impulse spending. I read a statistic, I actually share it in my roots membership on a regular basis with my members that Shopify did a study and they found that anywhere between 40 to 80% of all purchases are made on impulse. They even went ahead and said, even grocery shopping, like if you shop in a store, I'm not sure online, but if you shop in a store, 50% of all grocery purchases are made on impulse. This is a silent killer of most people's budgets. And again, it's rarely one big impulse of purchase that ruins things. It's the little decisions that you barely think about. It's where you're having that emotional moment of and that thought to yourself and telling yourself and selling yourself this. I deserve this. Or, you know, it's only a few dollars, or maybe it's only $20. You tell us it's that only phrase. By the way, you guys know how you can waste $10,000 in a year. Would you believe that it only takes $27.40 in daily spending every day to waste $10,000 a year? It doesn't take much. And again, it doesn't seem like a big amount when you're doing it. Or you might sell yourself on the idea, well, we'll make up for it later. I had a bad day, right? The kids are driving me crazy, had a bad day at work, your spouse is driving you crazy, whatever it might be. And you sell yourself on this is just gonna make me feel better. None of those things are really dangerous in the moment. As I said, over a month, over a year, all of those purchases begin to add up. The real problem isn't that you spent, it's that you didn't pause and think about it. So, my suggestion to you for a fix on impulsive purchases, and I've shared this many times on the show, is before any unplanned purchases, just wait 24 hours. Give it a little bit of time. Or at least just ask yourself is this planned or is this emotional? Most impulsive spending disappears with just a little time. And if you can give yourself that pause, I guarantee you 99% of the stuff that you thought you needed, you'll never buy.

Eating Out And Simple Guardrails

Speaker 1 5:50

Let's talk about number two eating out too often. This is by far one of the top budget busters I see. And for most households, this is just one of the budget drains, right? And it's not because eating out is bad. Well, it could be health-wise. I probably could use lose a few pounds, right? It's because eating out is just so easy. I really compare food and debt, like they're almost so linear, the habits that we have when it comes to it. They've made debt so easy to get into. It's the same thing when it comes to food, it's everywhere. You know, and it's easy because we're tired, we're busy. Like I said, maybe your kids are driving you crazy. It's just been a long day. You don't feel like going home and having to cook and then having to clean all that up. And before you know it, what started as a once-in-a-while thing becomes all of a sudden multiple times a week. So, my suggestion to you is when it comes to eating out, is don't eliminate eating out. All right, but just add in some boundaries, add in some guardrails, so to speak. So pick something like we're gonna do a weekly limit, put it in your budget, or maybe pick a specific dining out day. Set a dollar amount for every week, right? Plan that you're gonna get tired. One of the things that you could do is just easily set up some meal prepping time, get some meals, put in the freezer, get them in the refrigerator so that way when you are tired, it's not so much prep work on those days where there are long days that you know are going to be coming throughout that week. All right. So sometimes a little preparation can save you a ton of money there.

Subscriptions Audit And Cancellations

Speaker 1 7:24

Number three is all about subscriptions. All right, and it's not necessarily the ones that you use, it's the ones that you forgot about and don't even remember that you have. Obviously, we all know subscriptions are a huge thing. You've got Netflix and all the other streaming services and apps and gym memberships and random $9.90 charges here and $4 charges there, and it just keeps adding up. I've seen statistics, statistics of the average person now carries anywhere between two to three hundred dollars in subscriptions every single month. Individually, when you look at that in your bank account, it's easy to use that same old excuse like we used with budget buster number one. Well, it's only a few dollars, right? They seem small, but together, again, they can add up to hundreds of dollars per month. So, my suggestion to you, and if you've been listening to this podcast as part of our five daily financial to-dos that we recommend you to do on a daily basis, but one of the things you should do, go through your bank statements and your credit card statements or anywhere you're adding and adding these subscriptions, and go back over the last three to six months and look at all the subscriptions that you're buying, and then question yourself do you really need this? Have I even used this stuff in the last three to six months or even in the last month? If not, the easy choice is just to cancel it. You can always resubscribe later.

Convenience Spending And Preparation

Speaker 1 8:44

Number four, convenience spending. And I see this one a lot. All right. This is the I didn't plan, so I paid more tax. This is very similar to going out to eat. And it's not just the fast food, uh, but it's the gas station snacks, it's the sodas, it's the coffee runs, it's just the last minute things because we forgot something. You ran late, maybe slept in, it's a crazy morning. It's not laziest, it's really lack of margin, right? So the fix for that is very similar to going out, is just build in some preparation into your week. If you're someone who likes to stop and get a particular soda, can you get that cheaper at a grocery store? Or if you pick up a particular snack, can you get that cheaper in other ways? Because you are paying a premium, a high premium for that convenience. So start packing your snacks. Start thinking about quick meal planning, keeping essentials stocked up in your home. A little preparation is gonna save a lot of money in the long run. Number five is emotional spending, similar to impulsive spending, right? Because they go hand in hand. But emotional spending, I kind of trigger to more of like um, you know, you had a great day. Maybe you got a raise, maybe you got a promotion,

Emotional Spending And Fun Money

Speaker 1 10:00

maybe it's you just feel good. That feel-a-good feeling makes you want to spend money, right? Or it because it could be because you're sad, right? You spend emotionally because money is often the fastest way to either enhance that current feeling or to get you out of a slump, right? If you're feeling down about yourself, temporarily can make you feel better. You get that little bit of a rush, right? So what happens is you're stressed, you buy something, you're bored, you shop. And that's so easy to do nowadays because of apps that are on your phone, shop online, right? Stuff can be at your door, even sometimes same day, next day. Celebrating something, we tend to spend money. The problem isn't the emotion itself, it's using money as your main way of coping with it, right? A quick fix for this is to give yourself a small planned fun money category. So give yourself some spontaneous money inside your budget. It's okay to have some emotion and want to spend money or be spontaneous, right? That's okay. Give yourself permission to do that in your budget if you have the means to do it. See, the problem with some of these things is that when people start to budget, they cut themselves out entirely from everything that's fun. And then life feels miserable. Well, give yourself some permission to have some fun with your money. You work hard for your money. Put a little spontaneous line item in your budget of, hey, we can use this if we want to. And if you don't, use it for something else that month.

Irregular Bills And Sinking Funds

Speaker 1 11:20

Number six, irregular bills you didn't plan for. So it's that car insurance, maybe that you pay quarterly or biannually or annually. It's the unexpected school fees, back to school, right? Or maybe you have a sports fee that you pay for your kids, or field trips that come up unexpectedly. Annual subscription that you forgot, holiday expenses is a huge one. I can't tell you how many people say, Brad, the holidays just snuck up on me, even though they are the same exact time every year. These types of things are all predictable, but people treat them like they're surprises, and then they use the excuse, well, I had to go into debt because it was a surprise. So when these things show up, though, obviously naturally they're going to bust your budget in a lot of ways. So the fix is just to break big irregular bills into monthly savings. If you go is go on our podcast and listen to our episode list, another big topic that goes along with this is creating what we call our sinking funds, right? So a simple one is that. Like if you have a $600 bill that comes out once a year, a sinking fund would be as I just need to put in a $50 line item in my budget every single month and put that money into my savings. So that way when that one bill comes out once a year, that money will be there. It's the same expense with just a heck of a lot less stress. The other thing I would recommend too, when it comes to this, is as I suggested in previous budget busters here, is to go back and look at the last three to six months of your expenses. Look at your entire year of things that come up. When are birthdays? When are anniversaries? Look at back to school expenses. What'd you spend last year? Look at your Christmas expenses, what'd you spend the year before? Get that all figured out, get it all ironed out so you can start to come up with a monthly plan on how you can take care of those things because you are looking at the entire year, not just the next 30 days ahead.

Sales Traps And Decision Filters

Speaker 1 13:05

Budget buster number seven shopping sales and deals. Right, here's the hard truth when it comes to this. If you wouldn't buy it at full price, you didn't save money. You spent money. Sales are emotional traps disguised as math, right? That's exactly what they are. Retailers know how to make 50% off feel urgent and like you're getting a deal and you can't live without it. So the fix is ask one question before buying on sale. Would I buy this if it wasn't discounted? If the answer is no, walk away. And again, as another step to this, practice that 24-hour rule. If they're really tempting you with a sale, just give it a little bit more thought, a little bit more time. And you'll find time and time again, especially as you get better at it, you'll be more willing to walk away and not spend the money.

Track Spending Daily

Speaker 1 14:01

Budget buster number eight, not tracking your spending on a regular basis. This is a big one. This is why it's easy just to drift off of a budget because you're really not paying attention. Waiting until the end of the month to check your spending is like checking your speed after you've already crashed, kind of in a way, right? It's too late. You're reacting instead of adjusting. So an easy fix for this. This is part of our five five daily financial to-dos that we talk about on the show regularly. It's something that we teach in our roots personal finance membership. Do a five to 10 minute daily check-in. And one of those check-ins is looking at your spending from yesterday. Where did your money go? How did it compare to the plan that you created in your budget? I know that this can seem like a maybe a little bit daunting at first, but as you do it every day, it becomes very simple and very quick to do because awareness, that awareness of where your money's going, that begins to change the habit. That changes the behavior. And that's where the real success comes from. Number nine, they have no emergency fund.

Build A Starter Emergency Fund

Speaker 1 15:07

It's a huge budget buster. This one ties everything together. And we just had a recent podcast on the importance of emergency funds. Because without even just a small buffer, every problem becomes a crisis. If you have a flat tire, your budget's blown. You had an unexpected doctor visit, it goes on the credit card. You had an unexpected bill pop up, it's panic mode, right? So an easy fix to that is to get your small emergency fund built first and foremost before you pay off any extra debt. Now, our suggestion is to at least start with a thousand to three thousand dollars to get something going. All right. So just shoot for $3,000 as the max, $1,000 is the starter. We understand that that's not going to fix everything, but it gives you a lot more breathing room, especially when you have no savings at all. And breathing room changes how you make a lot of your decisions moving forward. Number 10,

Perfectionism Versus Consistency

Speaker 1 16:00

this is a big one, perfectionism. And I think this is one of the biggest budget busters of them all, and sometimes it's very silent because people don't understand that they're doing this. But if they say or they think to themselves, if I mess up once, I've completely failed and I can't do this. So one-off days essentially turn into I blew it and you quit. And I kind of laugh at this because people will ask me, How did I get out of debt? And it took me about four or five years to do it. I had a divorce in the middle of that, and that kind of extended it. But I say, uh, I failed my way out of debt, and that's exactly how I did it. I didn't get there in a perfect journey. I did a lot of the same stuff that a lot of you are trying. I messed up, redid it, messed up again, redid it. And essentially I just didn't quit and I failed my way out of debt, right? So uh I want you to adopt that mindset. One day or one off day, it doesn't ruin your entire future. I want you to adopt the mindset of I'm gonna fail at this, and that's okay, I'm gonna fail forward, and we're gonna fail our way out of this. It's gonna allow you to get back on track a lot more quickly and allow you to keep going. And remember that consistency is what beats perfection every day. The more consistent you are, the better off you're gonna be. So pulling this all together gave you top 10. Those are top 10 common ones. The truth about budgets is that they don't

Final Mindset Shift And Next Steps

Speaker 1 17:24

fail because people are just terrible with money. They fail because life isn't easy, life is messy, especially when it comes to finances. You're a human being. We're our emotions are very real. Sometimes our systems can be weak. So if you want your budget to actually work, stop trying to be perfect. It's instead focus on adding those guardrails and creating awareness around these top 10 things and looking at those things on a regular basis. And then just work on creating some simple rules, simple systems. We've been working on that all the way through here, 2026 on this podcast, reducing as much friction as we can, building habits that make choices easier. And remember, it's about small changes. Small changes are gonna be big, dramatic overhauls every single time. So look for those small things that you can do every day and just improve every day moving

Simplify My Money Invitation

Speaker 1 18:18

forward. All right, guys, if you're ready to break free from living paycheck to paycheck, you want to reduce financial stress, build savings, and finally pay off your debt for good. But again, maybe you're not sure where to get started. Don't worry, we've got you covered. Simplify My Money is sent to you each and every Sunday to your email. Simplify My Money is essentially your step-by-step roadmap to helping you have better financial control. And it's also gonna give you some easy to follow strategies to manage your money more effectively. It's gonna help you make stress-free money decisions that are gonna allow you to simplify your financial life with proven tips that actually work. And you're gonna gain the tools and confidence to tackle your financial goals head on. You can sign up for Simplify My Money by clicking the link at the top of the show notes. Thanks for joining us on today's episode, and we will see you guys on the next show.

Connect And Closing

Announcer 19:10

Thanks for listening to the Debt Free Dad podcast. Connect with us on Facebook, TikTok, YouTube, and Instagram. Just search Debt Free Dad. If you found value in today's episode, please leave us a rating and review. We so appreciate it. For resources, show notes, and links mentioned in today's show, visit debtfreedad.com. Catch you next week.