7 top mistakes people make when creating a budget:

1. Not including all your expenses - most people don't include costs like groceries and fuel as expenses, but if you check in most cases this two expenses forms a huge chunk of all your expenses. When you are going to a local supermarket, it always make sense to have a grocery list with you so that you don't end up buying that unnecessary appliance which is been advertised as a once-in-a-lifetime opportunity.
   
   
2. Not budgeting for compulsive shopping - most people know that every month they spend money which was not budgeted. This usually happens when you visit malls which are designed in such a way that they stimulate shopping. If you don't have a budget to buy something, why do you even think about walking into a store that is selling that you-must-get-it-at-all-cost item of clothing.
   
   
3. Underestimating variable costs - Even if you drive a car with a small engine, this days a R500 for fuel is no longer a realistic figure this days, grocery has gone up with a figure which is beyond inflation, but most people find themselves with a grocery budget which was created before the Rugby World Cup of 2007, unless if you just cutting on expensive items for cheaper alternatives.
   
   
4. Incuring extra expenses without checking if your budget allows - you walk into a furniture shop looking for a fridge which costs around R2,999, just when you are about to buy it cash, a salesman advise you to take a bigger one, which dispenses beer and bring it to your sofa, all of a sudden that R2,999 is now only able to cover only deposit, anyway a payment of R500 per month is affordable, but repeat this excercise 3 times you will be paying a huge chunk of your salary. If it's not in your budget, don't buy it, that's it.
   
   
5. Not saving for the rainy day - when disasters like accidents happens, they can leave your financial health in a difficult-to-recover state, so you need to be prepared for those unfortunate incidents. Costs are more likely to triple after a car accident, it always makes sense to always have a savings fund which is at least equal to your month salary, for self-employed people need more than a month salary, this is non-negotiable as you are more likely to also lose your income after an incident, no work, no pay for most of you remember.
   
   
6. Forgeting to update your budget monthly - a budget changes every month, you need to update it every month, most variable costs like electricity changes every month, so should your budget.
   
   
7. Not sticking to your budget - last but not least, use your budget as a guideline, you definetely need to follow it, not the other way round, if it's not listed in your budget, don't buy it.
   
   

Please feel free to add mistakes you have made, share it with us, and help others not to repeat the same mistakes you have made in the past.