How to save money if you have gone over budget

There are certain periods in the year - like the festive season, for example - when overspending is a lot easier to do. Sometimes you can’t help it, other times the temptation is just too much. 

During other periods, you may have unexpected expenses that cause you to spend more than you planned. 

No matter how you got there, it may feel like defeat if you’ve gone over budget, but the good news is that you can take the necessary steps to regain control.

We delve into the actions you can take below. 

Steps to take when recovering from overspending: 

Overspending once in a while is not the end of the world. You can come back from it if you take the correct actions. 

1. Figure out what happened to your money by accessing the situation 

It is important to figure out why you overspent and ask questions like; was the expense necessary and why or how did it happen? 

Determine whether it was due to unexpected expenses, poor budgeting, or impulse purchases. 

Thereafter, you can plan what to do and what not to do in the coming days and weeks. You can also see how much money you have to “make up for” going forward. 

2. Immediately stop spending money on anything unnecessary

Once you have your facts and figures in order, you can implement some rules to help you stay on track. For example, you can immediately stop making purchases that are not crucial. You should prioritise paying for necessary expenses like bills, utilities, and groceries - but anything that you don’t absolutely need, should be left unpurchased. 

3. Revisit your budget and create an adjustment plan for the next month

In order to balance your budget you will need to underspend in the next month. 

First, clarify where you will be cutting costs. Then, learn from your mistakes and adjust the next month's budget. The more detailed you make your budget, the better. 

Make sure you follow your budget strictly! There is no point in creating a budget, only to go off and spend as much as you like. 

4. Leave your credit cards and home 

If you don’t have your credit cards or store account cards on hand, it can be easier to avoid overspending. 

Remember, credit cards essentially give you the power to spend more than you actually have available to you. In the end, this can put you in a tough financial situation if you don’t use the cards carefully. 

That’s why leaving your cards at home can be a good habit to build. It takes away the option to spend unnecessarily, and keeps you from overspending in general. 

5. Find out if you can return any of the items you spent money on 

If you’re really struggling for cash, you could try to return some of the items you recently purchased and perhaps get a refund. 

Of course, you will have to have not used the item at all and will need to be in possession of the receipt. Different stores have different returns policies. 

Nevertheless, this is worth the try. 

6. Make financial goals and plans

For anything to be successful - be it work-related or in your personal life - it needs proper planning. 

You need to plan how you will use your disposable income. You can even plan for luxuries, to make sure you don’t go overboard. 

Consider your necessities and see how much money is left. Then add in one or two luxuries - whether its eating out, entertainment related or anything in between, and add it to the budget. After that’s added, don’t spend any more!

7. Adjust your budget permanently if you keep overspending

In some instances, you might find that you consistently overspent what you budgeted for a specific budget category, like groceries. If this happens you need to alter your budget.

Some argue that small changes to the rest of your budget can often do the trick. 

So when you go over budget in one area, you need to trim an equal amount from another area. If you planned to use R300 on entertainment and you actually spend R350, then decrease your spending elsewhere by R50.

8. Avoid cutting your savings amounts

In the instance above, you might find you need extra money to buy essentials such as groceries. Where will the money come from? 

Some people might opt to reduce the amount of money they put into savings. This is not recommended, as it will infringe on your long-term goals and may even cause negative consequences in the future. 

Before you even begin to think about cutting your savings amount, think about what you will use the money for whether it is really necessary.

For instance, if you are spending a lot on entertainment, you may not have to cut your savings - you can cut your entertainment spend instead.

9. Negotiate with creditors and service providers

Speak to your credit providers about what can be done if you cannot make your loan repayments. 

Creditors are often keen to assist. All you need to do is approach them with the facts of your situation and tell them what you can afford to pay or what your plan is going forward. 

You could also enlist the assistance of a financial expert to do this for you. 

10. Seek expert advice if you are becoming over-indebted 

The above-mentioned steps will help you gain control of your finances again after spending more than what you budgeted for.

If you are struggling to manage your finances and more importantly, meet your debt repayments, contact DebtBusters on 0869990606 to speak to a financial consultant, who will assess your current financial situation.

Going over budget is not uncommon, but you must be aware of your financial situation and take the right action to reduce your debt. Click here for more information on DebtBusters. 

Frequently Asked Questions

Q: What should I do if I've gone over budget in South Africa?

A: DebtBusters recommends a ten-step recovery plan: diagnose what caused the overspend; immediately stop all non-essential spending and prioritise bills, utilities and groceries; rebuild next month's budget to underspend; leave credit cards at home; try to return unused items with their receipts; set realistic goals with one or two planned luxuries; permanently adjust the budget if a category keeps overspending; protect your savings; negotiate with creditors; and contact DebtBusters on 086 999 0606 if you are becoming over-indebted.

Q: Should I cut my savings to cover overspending?

A: No. DebtBusters strongly advises against reducing your monthly savings to cover an overspend, because it undermines long-term goals and creates negative consequences down the line. Instead, trim a discretionary category — if you spent R350 on entertainment instead of the R300 you budgeted, cut R50 elsewhere. Cutting entertainment, takeaways or impulse purchases is almost always preferable to cutting savings.

Q: How do I negotiate with creditors if I can't make repayments after going over budget?

A: DebtBusters notes that creditors are often willing to assist if you approach them honestly with the facts of your situation and what you can realistically afford. You can also enlist a registered debt counsellor to negotiate on your behalf — DebtBusters offers an obligation-free assessment on 086 999 0606 and can negotiate longer terms and lower interest with every credit provider at once.