Many people believe that the word “budgeting” means denying yourself the things you want. In reality, establishing a budget is an important first step to gaining control over your finances, so that you can achieve your financial goals and the lifestyle you want. 

Having a good understanding of your income and expenses is critical in building a solid budget and will help you to better prepare for any unexpected financial challenges you may encounter. 

Whether you’ve tried a budget in the past or are establishing one for the first time, it may take a few attempts to create one that works for you. 

Let’s take a look at five very common budgeting pitfalls and steps you can take to help build a budget that works for you.

1. Not finding the easiest way for you to track your budget 

It’s important to understand that it may take a few months of fine-tuning, and trial and error, to find a budgeting method that’s right for you. 

Your budget can be as basic or detailed as you like. You may want to try a few different budgeting methods to find the one that’s right for you – whether it’s a spreadsheet, paper list or an app. Whichever tool you choose to use, make sure it works for you. Some people find the automation of a budgeting app helps to keep them motivated to stick to their budget. Others may prefer a simple notebook with a pen at hand to make quick updates or notes. Not all budget methods work for everyone, so choose one that’s easy and convenient for you, and you’ll be more likely to stick with it.


Check out the recently introduced Scotia Smart Money by Advice+, which you can find in the Advice+ tab of the latest version of the Scotia app. It gives you access to a variety of money management tools all in one place, such as a budget feature that tracks your spending and tells you how you’re doing on a monthly basis against the budget targets you’ve set up. 

To learn more, read on or visit

2. Assuming your budget will be the same every month 

Failing to account for changes in spending during certain months can really throw off your budget.

For example, your energy costs during warmer or colder months will vary if you’re not on an equal billing plan (spreading the cost of your annual electricity bill over 12 equal monthly payments).

While it’s usually easy to keep track of your monthly rent and utilities, don’t forget all those less frequent costs, such as insurance payments, quarterly property tax, tuition fees, and gift giving for holidays or birthdays.

Make sure you plan for each month separately, and incorporate both regular and less frequent, or irregular, expenses.

Scotia Smart Money makes this easy: you’ll be able to set up a budget that is based on your spending over the last six months. You can lean on this or create your own, and you can update your budget at any point to align with your spending and savings goals.

3. Not revisiting your budget 

Did you get a raise? Did you spend money on an unexpected gift? While having a budget is a great start, it’s important to remember that your budget should be continually reviewed and updated to reflect changes in your life that may affect your income and/or expenses. 

When your budget isn’t updated to reflect changes, it will become ineffective, and you may be tempted to abandon budgeting altogether. 

Even if there are no significant changes in your income or expenses, it’s a good idea to set aside time to review and revise your budget, whether that’s monthly, bi-monthly, semi-annually or annually – choose a frequency that works for you. 

Based on your income stream, you might need to review your budget every pay period. For couples, consider doing this together and use this as a chance to see if you’re both on track and on the same page financially – providing each other with encouragement and tips. 

Some questions to ask yourself when reviewing your budget:

  • Are all my regular and less frequent payments accounted for? See “Assuming your budget will be the same every month” for examples. 
  • Have I considered any additional income coming in, for example, a tax refund, bonus?
  • Is my debt repayment on track – can it be accelerated?
  • Am I reviewing my bank or credit card statements each month for unauthorized charges or savings opportunities (for example, cancelling unneeded subscriptions, memberships or product warranties)? 
  • Am I setting aside enough to meet my savings goals?
  • Am I overspending on something that I don’t need or want? Where can the money be best diverted – paying down debt or saving?


Stay on top of your account activity with InfoAlerts

Wondering when your next statement is coming? Looking for an easier way to stay on top of your transactions? 

With Scotia InfoAlerts, you’ll instantly get an app notification, email (or both) when important activity happens on your account. You can set up InfoAlerts on any of your bank accounts, credit cards, lines of credit or business accounts.

Visit for more information and to learn how to set up InfoAlerts for online banking on the mobile app.

4. Not setting aside money for unexpected expenses

Unplanned expenses, such as car and home repairs, always seem to happen at the worst possible time. Keeping this in mind, it makes sense to regularly set aside money in an emergency fund as part of your budget.

Did you know?

50% of Canadians cannot manage a surprise expense of over $1,000

Having access to a ready reserve of cash if an unexpected expense happens will prevent you from having to take on additional debt, and potentially disrupting, or even bringing an end to your budget. Many experts suggest that having an emergency fund to cover at least three to six months of total living expenses can help us get through difficult times, if they arise.

Pre-Authorized Contributions (PACs) are a convenient and flexible way to schedule automatic deposits to your emergency fund. You choose the amount you want to contribute and how often – for example, weekly, biweekly or monthly. Contribute whatever you can to your fund – even starting with $25 a month and then increasing the amount when you can. To see how quickly your savings can grow, visit and try out our interactive PAC video.

5. Forgetting to set aside money for enjoyment / things you want to do

A budget should help you control spending, so you have money left over for the things that make you happy -- whether that’s a vacation, new clothes, or going to concerts or restaurants.  If you make your budget too rigid and don’t set aside money for the things you enjoy, chances are your budget won’t last very long.

To make budgeting a little more fun and keep you motivated to continue, treat yourself to a reward if you stick to your budget for a certain amount of time – for example, the end of every month.

If you approach budgeting as a way to achieve financial well-being, the process will become more appealing. Remember that finding a method that works for you and building momentum may take some time. However, the reward of creating and maintaining your budget will be the ability to live the way you want.

Introducing Scotia Smart Money by Advice+

A tool to help you build and manage your budget effectively

Do you know how much you spend on take-out every month, sometimes overlook paying a bill, or could you just use a little more help managing your finances?

Scotia Smart Money by Advice+* is a new set of money management features that you can find in the Advice+ tab of the latest version of the Scotia mobile app. View your cashflow, track your spending, create a budget, and get the insights you need to maximize the way you manage your money.

To learn more, visit

Ready to get your finances on track for your future? Come in and speak to a Scotia advisor today