Money Trends

2024 Budgeting Survey

69% of Americans with a budget cite increasing costs as the biggest challenge they currently face when trying to stick to a budget

To determine where the best budgeters live, WalletHub compared more than 180 cities across 12 key metrics, ranging from the average credit score to debt-to-income ratios to foreclosure rates. View the complete report and infographics here.

Having a budget is extremely important for financial success. It gives you a greater understanding of how far your income can go and allows you to plan out exactly how you use your money. It can help you be more mindful of saving and investing while limiting unnecessary purchases. That said, creating a budget and sticking to it takes time and effort, and the current economic situation hasn’t made things any easier.

Around 69% of Americans with a budget cite increasing costs as the biggest challenge they currently face when trying to stick to a budget, according to a new WalletHub survey. The nationally-representative survey asked about a variety of topics related to budgeting, such as when it should be taught, how couples should approach the process, and what people do when they go over budget.

Cities With Worst Budgeters               Cities With Worst Budgeters
1. Seattle, WA173. Toledo, OH
2. Honolulu, HI174. Huntington, WV
3. Boston, MA175. Tulsa, OK
4. Fremont, CA176. Augusta, GA
5. San Francisco, CA177. Memphis, TN
6. Madison, WI178. Shreveport, LA
7. San Diego, CA179. Mobile, AL
8. Vancouver, WA180. Montgomery, AL
9. Minneapolis, MN181. Gulfport, MS
10. Huntington Beach, CA182. Jackson, MS

 

Key Survey Findings:

  • Inflation difficulties: 69% of Americans with a budget cite increasing costs as the biggest challenge they currently face when trying to stick to a budget.
  • Expensive safety net: Nearly 2 in 5 Americans use a credit card to cover extra expenses if they go over their budget.
  • Need for budgeting classes: 94% of Americans think budgeting should be taught in high school.
  • Liar liar, budget on fire: Nearly 1 in 5 people admit they are not honest with themselves when making a budget.
  • Budgeting and relationships: 23% of Americans think couples should budget separately rather than jointly.
  • Reluctant budgeters: 27% of people would rather do their laundry than make a budget, while 20% would rather clean their house, and 16% would prefer to do their taxes.

Q&A With Cassandra Happe, WalletHub Analyst

How does inflation affect people’s ability to budget?

“Roughly 69% of Americans say that rising costs are the biggest challenge they face when trying to stick to a budget, according to WalletHub’s latest survey. Although inflation has cooled recently compared to where it was during the pandemic, it’s still higher than ideal and prices aren’t going to return to where they were before. The best way to deal with inflation when making a budget is to try to compensate for it. As you notice prices on common items increasing from month to month, set aside a slightly higher amount of money for them as needed. Try to redirect money from less essential, luxury spending to instead pay for price increases in necessary things like groceries or gas.”

How important is it to be honest while budgeting?

“It’s extremely important to be honest with yourself while budgeting, but nearly 1 in 5 Americans aren’t, according to WalletHub’s new survey. When you aren’t honest about how much money you have or how much you’re going to spend, there’s little point in budgeting at all because things naturally won’t go according to plan. Note that being dishonest isn’t the same as not sticking to your budget. It’s normal to correctly identify your income and expenses, set goals for saving and investing, and then be tempted to spend extra money on frivolous things instead. Honesty and self-control are necessary for both creating a good budget and sticking to it.”

How do Americans cover extra expenses when they’re forced to go over budget?

“Around 52% of Americans take money from savings to cover extra expenses when they’re forced to go over budget, according to the latest survey from WalletHub. This is encouraging because it shows that most people have been responsible enough to save some funds to fall back on, but it can still leave them vulnerable to future emergencies as most people have limited savings. Over 37% of Americans use credit cards to cover extra expenses, which can be very expensive if left unchecked, given that the average credit card interest rate is over 21% for existing accounts. Nearly 11% of Americans will borrow from friends or family instead of using a credit card, which can be cheaper but can also strain relationships if the money doesn’t get paid back.”