Photo by Artem Beliaikin from Pexels

Budgets are great. The right budget shows you how you should be using your cash each month. It can help you to keep debt to a minimum, improve your long-term wealth, and reach your savings goals.

However, there are more parts to a successful budgeting routine than most people realize. It’s not enough to just plan and implement your budget. You also need to know when to adjust your plan, too.

Ultimately, budgets aren’t set in stone, because your finances aren’t as reliable as you might like them to be. Even if you have a stable income and you know all of your outgoing expenses right now, you have no idea what could happen a month, a year, or ten years from now.

Here, we cover three pivotal life events that will force you to stop, take stock, and change your budget. When any of these occur, be sure to take action before your spending gets out of hand.

1. If Your Income Changes Your Budget Will Change

Your budget is based on two things: the money you have coming into your accounts, and the money you have going out. If the amount of cash you earn each month changes, then the amount you can afford to pay will change, too.

Whether you’re a business owner, a self-employed freelancer, or you’re working in a stable job, there’s always a chance that something in your income will change. For instance, maybe you’ll get a slightly better income. This might happen because you do better at work and your boss gives you a promotion. If that happens, you’ll be able to look at some of the things you cut costs on in the past. Maybe you’ll be able to afford them again.

You’ll also be able to dedicate extra money to your savings if you have more income to work with.

On the other hand, you could lose incoming cash. For example, you might need to switch to a part-time job so you can look after a new child. Or perhaps you can’t get quite as many hours at work as you once could. In such cases, you’ll need to tighten the purse strings a little more.

2. Taking on a New Expense Will Alter Your Budget

New expenses can come in a variety of shapes and sizes. For instance, if you decide you want to go on vacation with your family this year, you might need to take out a loan to afford the trip. You can compare your loan options online to ensure that you’re getting a low interest rate. However, you’ll still need to find extra cash in your budget that you can dedicate to repayments each month.

Other new expenses can include a family pet that you and your loved ones simply had to have or even a new baby that’s coming your way. All of these extra expenses force you to re-think how you’re going to afford things going forward.

Don’t wait for a new expense to be massive before you reconsider your budgeting options. Sometimes, a small extra expense like $10 for a streaming service once a month can throw the rest of your budget out of balance. Don’t just borrow out of other categories in your budget. Give every expense its own place in your financial plan.

3. Choosing a New Goal Forces Changes to Your Spending

Finally, the most effective budgets are always the ones that focus on driving you toward a specific target. Your goal might be to go on vacation next year or put a deposit down on a new home. Other people want to save up money so that they can try going self-employed or attempt to start a family.

If your goal changes, then your budget may well change with it. You might have only wanted to put about 10% of your income toward your last savings target. However, if you’re really passionate about your new goal, you might decide to increase that amount to 20% or even 30%.


If your new goal involves a new partner, such as your spouse or significant other, then they’ll also need to play a part in deciding how you’re going to spend your combined money. Make sure that you sit down together. Think about how you can set up the best possible path toward your goals.

Remember, to make your budget as successful as possible, ensure that there’s a way to track your progress toward your targets. This will show you when you might need to change your strategy again, and it may also help to keep you motivated.