Article Bookmarked
Bookmark Removed

3 Steps to Reset Your Budget After a Period of Heavy Spending

Mar. 19, 2019 YNAB

… and, of course, from time to time, it’s a mixture of all of the above happening all at once. Ugh. That’s when you know it’s time to regroup, which isn’t exactly an inviting prospect. I mean, who wants to confirm that, yeah, it’s probably a good time to go on a PB&J diet for a month?

But, remember, your budget is your friend. Really. It’s not there to judge your past decisions or make you feel bad—it’s only objective is to help.

Your budget is there to show you the path from where you are to where you want to be. So, if you’ve slid off-track (a position that nobody wants to be in), then it’s a very good time to get nice and cozy with your budget. Here are three steps to get you started:

1 – Reconcile Your Accounts

This is probably the toughest step of them all, but it’s the one that sets you free. That’s right, it’s time to face reality. So, grab a cup of coffee and fire up your budget. It’s time to reconcile with your bank account(s). In other words, make sure that your budget and bank balance(s) match. (It’s times like these when you’ll thank yourself for simplifying accounts!)

If it’s been a while since you reconciled, this might be a good time for a fresh start.

2 – Cover Overspending

Next, cover your overspending. And, no shame! You’re not a failure because you didn’t perfectly stick to your budget, you’re human! Make some adjustments, and keep going!

3 – Be Honest About Your Needs

With Steps 1 and 2, complete, you’re back in a power position because you know exactly how many dollars you’re working with. Now, it’s time for a heart-to-budget talk. Ask yourself:

  1. Was my heavy spending mostly the ripple effect of a one-off circumstance? (e.g., You moved, had to pay for a moving truck, packing supplies, security deposit and several nights of take-out because your kitchen was in boxes.)
  2. Was my heavy spending just the accumulation of habits that don’t fit well in my budget? (e.g., You started a new job and it’s been difficult to pass up the daily invitation to eat out at lunch hour. Plus, you’ve been spending more on gas, too, because your new commute is twice as long.)

Pinpointing why you spent more money than usual helps you adjust your budget, going forward, to help you avoid future cash flow crunches.

Using the first example, above, you might pad your moving fund category more for next time, or even break it out under its own category group with categories for the actual move (truck, packing supplies), move-in costs (security deposit, utility deposit, pet fees) and incidentals (lunch on the road, eating dinners out for the first week).

Or, in the second example, you might realize that you’d rather pack your lunch and save some cash—especially now that you need to budget more money for gas to cover your new drive to work.

The point is, cutting back isn’t always the right solution. It might be the solution, but it’s also OK to increase your budget for the categories where you overspent. Sometimes you have to spend more, sometimes it’s a quality of life issue, and both are totally OK! You’re the boss of your money. This exercise is a chance to shift your budget around and reprioritize your dollars, accordingly.

Don’t Feel Down, Take Action!

It’s never fun to be at the tail-end of a period of heavy spending. Money feels tight, paychecks feel slow and you’re probably dreading the lean days ahead while you catch up. But, if you follow these three steps, you’ll funnel all of that frustration and overwhelm into an action plan that puts you back in control. And, if you’re anything like me, you’ll feel a sense of empowerment the moment you start.

Read More on YNAB

Gene Upshaw Player Assistance Trust Fund

Apply Today

All Resources

Tell Me More

Consumers Are Not Financially Prepared for Natural Disasters - Here's How to Help

Read More

How to Boost Your Credit Score

An informative podcast to keep you busy on your next drive, commute or run on the treadmill.

Read More

Why You Should Budget Weekly, Not Monthly

So you’ve built out a budget but are still falling short? Try this.

Read More

Retirement Plans for the Entrepreneur

This can be an overlooked step when moving from a 9-5 job to striking out on your own.

Read More


A candid conversation with Dr. Oz explores your relationship with yourself, others, and food.

Read More

Sitting Is Bad for Your Health

Not all types of sitting are equal: looking at you binge watchers.

Read More

10 Questions to Help You Run an Effective Meeting

Because No One Wants to Waste Their Time

Read More

Forgiving Brings Freedom

Read More