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Disappearing Money? Plug Those Budget Leaks


Back when I had a 9-5 office job, I would sit on an exercise ball at my desk. Over the course of a few years, my incessant bouncing must have taken its toll and the ball developed a small hole. While I didn’t realize it right away, the ball was literally deflating under my own rear end. It wasn’t until I came to work one day and the ball was noticeably flat on the bottom that I realized there was even something to fix.

Budgets can take on a similar phenomenon if you’re not careful. An ATM fee here, a latte there—all of these expenses creep in and, if left unchecked, can wreak havoc on your best laid financial plans.

Much like it was important for me to fix my exercise ball’s leak, it’s crucial for you to fix any spending leaks you might have. If you find yourself running out of money at the end of the month or can’t seem to remember the charges you made when it’s time to pay your credit card bill, you might have a spending leak that needs to be plugged as soon as possible.

Identifying a Spending Leak

Budget leaks are sneaky but if you’re willing to do a bit of work, they can be identified and plugged. Because budget leaks are often irregular and easily overlooked, you need to take that much more initiative when it comes to finding them.

One of the easiest ways to do so is to track your spending for a set period of time. Write down everything you spend; every penny—and I mean everything! Once you have your data (for at least a week but ideally a month), you should check the total amount you spent in various budget categories against what you originally planned to spend. If there’s a huge discrepancy, you’ve just identified one (or more) of your budget leaks!

Plugging a Spending Leak

Simply finding a budget leak means virtually nothing if you don’t plug it. You can do this by carefully examining why you overspent in the first place. After identifying the reason behind the ballooned spending, you next need to identify (and later implement) a realistic course of action that will help you plug the leak permanently.

Whether it’s changing your budget categories, rearranging the amounts you assign to each category or changing your habits in lieu of higher prices, you should plan to make these changes over the long term.

Maintaining Your New Plan

After you implement your new plan and changes, ensure you’re staying the course by continuing to track your spending and reconcile your budget categories at least monthly. If you see that you’re still having trouble meeting those numbers, you may want to consider more drastic changes to your routines and habits.

If you’re close but still need a bit of a push to get to where you’d like to be, consider adopting a cash-only spending policy as research has shown it’s much easier to not spend when you’re parting with cold, hard cash rather than handing over a debit or credit card.

How have you plugged any budget leaks?

This post was written by Jen, a staff writer from The Happy Homeowner

Budget Money


My name is Derek, and I have my Bachelors Degree in Finance from Grand Valley State University. After graduation, I was not able to find a job that fully utilized my degree, but I still had a passion for Finance! So, I decided to focus my passion in the stock market. I studied Cash Flows, Balance Sheets, and Income Statements, put some money into the market and saw a good return on my investment. As satisfying as this was, I still felt that something was missing. I have a passion for Finance, but I also have a passion for people. If you have a willingness to learn, I will continue to teach.


  1. We are pretty vigilant and almost always stay under our budget. However, if we do realize we are spending a lot of money frivolously we do try to plug the leak.

    • It sounds like you have a great system in place; keep up the good work! Staying vigilant makes it that much easier to keep on top of these types of things.

  2. I am pretty maniacal about our budget. I definitely agree to look at your spending habits regularly (for me it is daily) and constantly ask if there is a better way to spend on a given item. As they say, a penny saved…

    • So true! I’m more relaxed now with my spending checks (went from daily to 1-2 times/week), but I still track everything to the penny that’s coming in AND going out. It keeps me accountable at the very least!

  3. The key here is having a system in place to identify budget problems. Once I started doing that (using Mint), I was able to get my budget perfected. Thanks for the post!

    • You’re welcome; thanks for your comment!

      The system is the best part of all of this–at the risk of sounding like an uber nerd, I’d be lost without my super-duper Excel workbook keeping me in check each month 🙂

  4. Great insight about finding these gaps that often account for much unnecessary spending. Great post, Jen!

  5. Great analogy! I realized a small budget leak a couple years ago when I continued to go out for lunch instead of brown bagging it. Plugging small leaks can sometimes lead to large gains/savings.

    • Oh man, going out to lunch adds up FAST! I definitely became a brown bagger when I finally caught on to the ridiculous amount of money I was spending so foolishly.

  6. Good post on plugging budget leaks. It’s really important to keep track of your spending to know which ones you should work on if you really to make budget cuts or if you are spending more than you should.

    • Yep! How can you possibly make the correct changes if you have no idea what’s happening in the first place?! 🙂

  7. As a mom who manages the family finances, I always try to list every detail of my spending even the small ones that are most often unnoticed. With this, I am able to track down every detail of spending I made.

    • Sounds like you have a great system as well. And yep, those smaller expenses are always the ones that bite the hardest!

  8. I use an exercise ball at work as well so this analogy was great. I’m not sure if my ball has a leak but it’s been over a year since I started using it so it needs to be topped off. I didn’t notice it was getting low until my arms were at an odd angle to reach the keyboard; I’m sure budget leaks work the same way. Now if I could just find that pump…

  9. Hahaha…love the bit about the odd angle–that’s definitely happened to me, too! And thanks for the kind words–glad everyone is liking the analogy. But seriously, it’s the slow and steady leaks that are far worse because you don’t usually notice them until it’s too late or you have a ton of work to do to fix them….

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