Conventional wisdom says that you should have a budget to get the most out of your money. While I believe a budget is a good thing to have when money is tight and you are first learning how to take reign of your personal finances, the ultimate goal should be not to have a budget at all. Once you become financially adept, learn what you want to spend your money on and not waste it on all those things that don’t really matter, there is no reason to budget because your finances will take care of themselves.
I believe that people make the huge mistake of looking at how much money they have and try to distribute it among all the competing expenses that they have. This is putting the horse before the cart because all those competing expenses are mainly things that you really don’t want or need. You have, over time, become accustomed to them and fail to consider whether they are true needs or wants because you are forced to spend all of your time trying to figure out how to pay for them.
It’s not an easy thing to figure out what it is your truly want and need because it goes against the consumerism that is rabid in our society. In fact, it is a lot more difficult to achieve this enlightenment than to figure out how to pay all the competing expenses which is why so few people do it. But if you are looking for true financial freedom, it will never come until you have an innate knowledge of what is important to you and what is not.
I used to be a budget master. I had information down to the penny of where all my spending went. I tracked every purchase and made sure I saved my 15% for years. The problem is that the process of budgeting in itself is being a slave to your finances. It meant that I had to delay gratification and plan to get the things that were on my wish list. This all appeared to be wonderful except those things on the wish list were not things that I really wanted — they were things that I thought I wanted.
Then one day I had a heart attack. It was bad enough that I feel fortunate that I’m still alive. And as I sat in the hospital bed it occurred to me that all of my planning and saving and budgeting that appeared to be the perfect way to handle one’s finances meant very little when I didn’t have any idea what I truly wanted.
Sometimes it takes the stark reality that your time here on earth is limited to figure out what is important. I wish that this story would convince you of that, but I also know that it is highly doubtful that it will. At some point you are going to have to experience something that puts it all into stark contrast so that you know what things are important to you and what is all window dressing. Hopefully that will happen sooner rather than later.
What I have found is that I really need very little and most of the things that make me happy don’t come with a price tag. I don’t have to buy things in search of happiness because I’ve already found it and it comes mainly from the simple things in life: my family, taking walks and taking the time to talk with others.
I no longer budget. There is no need to because I really don’t buy much these days. Everything that I want always costs far less than I make each month because there is hardly anything I want or need. What I have learned is when you understand what it is that is most important, a lot of those expenses that you are always trying so hard to pay will suddenly disappear.
You won’t hear this from any financial guru, but it is the true secret of financial success. Find the things that are important to you. Find those fundamental things that you are working so hard to earn money for. They aren’t the bigger house or the fancier car. They aren’t the prestigious job or the six figure income. It comes down to being happy with yourself, your family and what you do each and every day. And when you come to this realization, there is no need to budget anymore because they don’t cost a whole lot.
Image courtesy of mlaaker