How to Overcome Budget Guilt

Managing your personal finances and making the most of your money is a constant balancing act. Sometimes it’s pretty easy. Sometimes you slip and take a tumble.

Looking for guidance and inspiration, we might check out blogs, podcasts, YouTube videos, and forums. Sometimes we get a real lift, reading these stories and hearing solid, actionable advice. And sometimes we can’t help but think, “Boy, I really stink at this.”

It’s perfectly normal to feel disappointed when we don’t live up to whatever standard or goal we’ve created for ourselves. But there’s a fine line between feeling disappointed and beating yourself up. If you’re carrying around guilt over your latest spending spree or a retirement account that’s not as full as everyone says it should be, today’s the day to let it go. Here’s why feeling bad about a busted budget won’t do you any good, and how to redirect those negative feelings into positive outcomes.

Remember that Perfection Isn’t Possible

This is probably obvious, but it’s a helpful thing to repeat: everyone makes mistakes. While we’re often quick to share our successes, we don’t always like to broadcast our slip ups. This can sometimes make it feel like you and you alone are the only one not killing it on a daily basis.

When you hit roadblocks or miss your goals or straight up do something silly with your money, just remember that we’re all struggling and we all make those very same mistakes. Even the easily preventable ones. Someone somewhere just spent $15 dollars having a medium order of fries delivered to their house from McDonald’s. Don’t hold yourself to an impossible standard.

Don’t Sweat Individual Moments of Weakness

Eat in or go out to a restaurant? The frugal option is almost always eating in, and if you’re on a tight budget or have financial goals that require you to shave every penny from your expenses that’s the option you should probably take.

But that doesn’t make eating out bad and if you love eating out – if it’s one of your favorite activities – then you shouldn’t feel bad about it. Because those individual choices only matter as they relate to the bigger picture of your personal finances. Can you afford to eat out twice a week? Does that negatively impact your other financial goals in some way?

Don’t get hung up on individual choices. You’re going to be faced with thousands (if not millions) of choices and decisions throughout your life and you’re not going to nail every single one of them.  

Don't Lose Sight of the Big Picture

In a vacuum, stopping at Starbucks every morning on your way to work doesn’t matter. What does matter, however, is the impact of those purchases on your overall financial health and long-term goals. It’s easy to say, “Never buy coffee at Starbucks. Just make coffee at home.” But the coffee isn’t really the issue. The issue is what you can’t do because you spend $4 five days a week on a to-go cup of coffee.

So rather than feeling bad about past choices or about spending money on certain conveniences you love, just think about where these expenses fit in the big picture. Maybe you need to cut back somewhere else to make it work. The key here is not to feel guilty about what you’ve done. Instead, focus on what you’ll do going forward to balance out those choices.

Remember that Your Happiness Doesn’t Have to Look Like Anybody Else’s Happiness

In the end, your day to day health and happiness come first. That doesn’t necessarily mean you live solely for the moment in front of you, but it does mean that your values and personal vision should guide you as you make important (and distinctly unimportant) daily decisions.

In the FIRE (financial independence, retire early) movement, devotees maximize both their earnings and their savings in order to retire as quickly as possible. That means expenses are driven down to the barest essentials. You are careful and pragmatic with every cent you spend.

Personally, that sounds awful. I like trying new restaurants and spending waaaay too much on Christmas presents. FIRE doesn’t work for me, but that doesn’t make my significantly less strict spending plan bad. It’s just different. And, most importantly, it supports my goals and matches my values. If I tried to live with FIRE or any other method that didn’t suit my personal vision, it wouldn’t work – and I’d probably feel pretty bad about it.

So if you’re feeling guilty about how you spend money or the choices you’ve made, examine those feelings. It’s possible you’re holding yourself to standards that don’t match your values. It’s possible you’ve set goals that simply aren’t right for you.

Most importantly, it’s okay to feel bad about your finances. However, it’s not okay to get stuck in those bad feelings and fail to address the cause of your issues. If you feel guilty for what you’ve done with your money so far, that’s fine! But only if you turn that guilt into action. Learn from your mistakes. You'll never be perfect, but you can always get better.

If you need help finding room in your budget, MMI offers free financial counseling, available 24/7 online and over the phone. We can help you analyze your situation and come up with the best way to repay debt, build savings, and prioritize your spending. Get started today.