7 Budgeting Mistakes and 7 Myths 2

7 Budgeting Mistakes and 7 Myths

Money Tree Network is all about budgeting, making money, and living your life completely debt free. The only problem is that there are many myths out there about budgets being scary.

We are here to make money less scary, so let’s debunk some of these budgeting myths.

Budgeting is Difficult

When you first start budgeting it can be hard, but after you start budgeting for a couple of months, it will start to become easier! You will start to learn exactly how much you are spending on each budget category.

The only reason it is hard to budget in the beginning is because you really have no idea how much money you are spending on random things. You are probably overspending on food, entertainment, and impulse purchases.

When you start to track every purchase you make, you will see where you are spending money and where you are able to cut it back slightly. You will seriously feel like you got a raise when you start budgeting.

Start up an excel spreadsheet, get on the Every Dollar or Mint app, or get out a pen and paper and just write down your total monthly income. Once you know how much you are bringing in every month, write out all of the things that you spend money and guess at how much you are actually spending on each of these things.

During the first month, you will most likely be adjusting your budget weekly, but after that it will start to get easier since you will know where you are spending the money.

Budgets Only Work For…

Budgets are for absolutely everybody! There are four budget methods and as long as you use one of them, you will feel like your money is working for you. There are so many excuses to not use a budget, but one specific reason to use one…to help you manage all of the money that you bring in!

People say that it does not align with their culture or religion. This is my favorite, because it doesn’t make any sense. All cultures and religions have one thing in common…be a good person. Having a budget and being debt free is a great start to being a good person. It will allow you to donate or tithe, help others, and help yourself!

“I don’t have any payments, so why would I budget?”. While you are in college, you have many payments, even if you don’t realize it. You have to pay tuition, fees, housing, books, food, and so many other expenses. Even if you aren’t making these payments every month, you should be saving your money so that you can afford to pay all of these things. Budgeting will allow you to break all of these down into monthly expenses by taking your tuition and dividing it by 12 (for each month of the year).

Another common excuse for not budgeting is that the person does not have any money. My answer is always “How did you get to not having any money?”. Typically it is because they didn’t budget!

If you aren’t bringing in any money, then you need to start working and then start budgeting! Even if you just work a part-time job, you have income that you need to budget!

I Can Budget Without Writing it Down

No, you cannot budget without writing it down. Without writing out all of your expenses, you will not be able to track it. Having that savings goal works best if you write it down before the month starts. This way it is there for you to reference.

White piggy bank with dollar sticking out

I Make Plenty of Money so I Don’t Need a Budget

If you make a lot of money, that is fantastic! Good for you, but the unfortunate truth is that you could probably be making way more! Knowing exactly where your money is going will make you feel like you get a raise. You cannot out-earn your spending without understanding where your money is going.

It doesn’t matter how much money you make, just start budgeting! Whether you make $40,000 or $400,000 per year, budgeting will make you feel like you got a huge raise. It is always worth it.

Ain’t Nobody Got Time For That

For the first month or two, it may take you a little bit longer to lay out your budget, but once you get the hang of it, you can lay out a budget in all of 10 minutes! It really does not take that long to budget.

If you use an Excel spreadsheet to create your budget, you will be able to just fill in the numbers for each month. If you use an app like Every Dollar or Mint, you will just login to the app and type in your numbersl. You will start to know exactly how much you are spending in each budget category and it will become a habit after a little while. Get started budgeting today!

I Always have Unexpected Expenses

Having unexpected expenses are part of life, but that is a great reason to start budgeting today. Having a miscellaneous or emergency budget line will help with these. In my budget, “emergency” is a separate budget line, in case I have to spend money on a random expense.

My emergency budget line is the catch-all in my budget. It gives me a tiny bit of room to go over on a category or spend money on something I wasn’t planning on spending any money on this month.  This is in addition to my normal 3-6 month emergency fund.

I’m Not Good At Math

Not being good at math does not relate to how you budget. If you are able to spend money, then you are able to budget. If you use an Excel spreadsheet, you can have it do all of the math for you. The Every Dollar and Mint apps do the same thing!  All you have to do is type in your numbers and these platforms will calculate anything you want to calculate.

College is when you are likely the most vulnerable you will ever be. This is why I created a guide to money mistakes to avoid while in college. You will have banks and credit unions trying to sell you credit cards, loan companies trying to sell you student loans, and textbook companies trying to rip you off on the purchase of your textbooks.

When you go to college, it is often times your first time ever living on your own. College students are the prey for so many companies who try to make students make money mistakes.

Biggest Money Mistakes in College

Don’t Fall for Student Loans

There are many student loan companies out there that prey on highschool students who are looking to go to college. They figure highschool students don’t really understand money (you are different since you are looking this stuff up). They have convinced society that student loans are the only way to go to college.

We have officially hit $1.5 trillion in student loan debt in America alone. This number continues to rise every year…so much so, that Sallie Mae, one of the largest student loan companies in the country, sent 100 of their employees to Hawaii to celebrate the fact that they lent more money in 2019 than ever before. Is this OK to you?

Student loan debt is affecting the country in so many ways. Millennials can’t afford houses, vacation, or many other things because of student loans. This is affecting the economy in big ways. In fact, according to Forbes, almost 12% of student loans are not even getting paid because the recent graduate cannot afford to pay it.

Are you waiting for student loan forgiveness now? I would not bother. Forbes says out of the almost 50,000 applicants who submitted an application for student loan forgiveness, only 423 received it. Please do not rely on this!

So how do we stop student loans? With blogs like mine that advocate for you to work during the school year! That is the best way to pay for college without student loans. If everyone did this, we would be in much less trouble than we are now and recent graduates would be buying instead of renting houses, have the money to buy a car with cash, and travel.


The banks and credit unions on your campus will likely try to sell you credit cards…RUN!  Americans are over $1 Trillion in credit card debt according to Lexington Law. This number rises about 5% every year. Almost half of these people do not pay their credit cards off in full every month and almost 7% of Americans default on their student loans.

When you break credit cards down by age, you see that Americans between the ages of 18 and 22 are almost $750,000 in credit card debt with interest rates as high as 35%. Think about this! How much debt will this be in a couple years if they don’t pay it back quickly?

Stay away from credit cards because debit cards are the best payment method to help you stick to a budget. Use your debit card instead of a credit card because it has the same convenience features, some get points, and they are just as secure as a credit card. There are no advantages to using a credit card at this point in your life.

Shop Around For Textbooks

Textbook companies are ridiculous! They jack up the prices on their textbooks to astronomical rates. They charge students up to $300 for a simple textbook that can cost them as little as $10 or $20 to make. So how do we avoid paying $300 for most textbooks?

Before you buy any textbooks, check out slugbooks.com, which shops multiple websites for the lowest textbook price. This website checks Chegg, Amazon, Valore Books, and a few other sources and will list the price for each website.

See if you can rent the textbook. If you do not need to write in the textbook for any reason, just rent the textbook! It is usually cheaper to rent the textbook than buy it, so you will almost always save money renting.

Not Taking Other Expenses Into Account

There are more expenses in college than just tuition and room and board. You will have to pay for a car, parking, fun, laundry, technology fees, events, dorm room decorations, and more! Colleges will charge you thousands of dollars for tuition and room and board, and then they will charge you extra for everything else that you want to do.

Having a car on campus can cost you up to a few hundred dollars every semester! Some colleges charge you just to have it there, pay for parking, possibly insurance, and of course gas and maintenance. It can be extremely expensive to have a car on campus…and don’t forget if you are the person with a car there all of your friends will be asking you to drive them places.

Many of the places that you will drive your friends, you will have to pay to be there. Whether you are going to a restaurant with your friends, going bowling, or going to a movie you will probably have to pay.

Schools will also charge you for laundry and technology fees. While some schools offer free laundry, most do not. They can charge you up to $5 or $6 per load of laundry! That is crazy if you are doing laundry once per week for 15 weeks! Some schools also charge you technology fees in order to use their computers, wifi, and printers. My college forced you to pay the technology fee and pay $5 per load of laundry.

Decorating your dorm room or apartment can also be very expensive. At bare minimum you will likely have to pay for a comforter, pillow, sheets, school supplies and organization products, additional clothes, and some kind of pictures. These things combined can cost upwards of $150.

Some additional things that you will probably want to buy are posters, trash cans, makeup, extra pictures, mini fridge, and microwave. These combined can cost you an extra $150-$200! That is a total of $300-$350 just for your dorm room.

Not Using a Budget

A budget is one of the most important things in college. If you want to graduate college without student loans you will have to have a budget. There are 4 different types of budget as laid out here. It doesn’t matter which type of budget you decide to use as long as you are using one.

I suggest using the envelope system while in college, because it will allow you know exactly how much money you have to spend with your friends. If you are not working during college then take how much money you are planning to spend and break it into 48 months. That is your budget! Break it down into separate budget categories from there and use the envelopes to keep yourself on track. It is very possible!

Going to a College You Cannot Afford

If you cannot afford to pay for college in cash then you have three options. You could start working as much as you can and delay college. You could go to a state school or community college that you can afford if you work your way through it. Or you could apply for as many scholarships as you can and pay for school with your scholarships.

If you can afford to go to a private school then you can do it. If you cannot afford to go to a private school without student loans, then take a look at your other options. It is possible to graduate from school without student loans.

Not Graduating in 4 Years or Less

College is extremely expensive per year, so why go longer than you need to? If you take school seriously and plan to graduate in 4 years or less then it is possible! I graduated in 3.5 years, because I took classes at my local community college while I was in highschool and I took summer classes.

If college costs an average of $27,000 per year, why would you want to spend an extra $27,000 because you failed a few classes?  Take college seriously, go to community college if necessary, and graduate college as soon as you possibly can!

To Sum It Up…

There are no excuses to not use a budget. A budget is extremely rewarding, because budgeting will make you feel like you got a big raise. If you budget for 6 months and hate it then stop budgeting. You just have to try it for a while to get used to it. Don’t let your excuses get in the way of #savingthatmoney! Get started today!

College students can be very vulnerable if they do not know what to expect. Reading this guide can help you avoid some huge mistakes in college.

You do not need credit cards, student loans, extra textbooks, or tuition! If you take college seriously, and take debt off the table then you can graduate college without student loans.

There are no excuses to not use a budget. A budget is extremely rewarding, because budgeting will make you feel like you got a big raise. If you budget for 6 months and hate it then stop budgeting. You just have to try it for a while to get used to it. Don’t let your excuses get in the way of #savingthatmoney! Get started today!