Budgeting, Personal Finance

Why You Don’t Want A Budget

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.

28 thoughts on “Why You Don’t Want A Budget

  1. This was an interesting read since it was a perspective I have not considered before. I do think that a lot of money is wasted on things we think we want, but really aren’t. I think a lot of people’s finances would improve dramatically if they could overcome this problem.

    At the same time, I don’t know if giving up budgeting all together is the answer since I think it is important for all people to do.

  2. There is nothing wrong with wanting things and I have found, in my experience, the ones that say things like buying stuff isn’t important are the ones that can’t afford to do so. It’s a problem of earning, not of budgeting. If you earn enough, you can buy whatever you want and still not have to worry about a budget. I’m sorry that you had a heart attack, but to throw out this mumbo jumbo about not needing most things because you had some type of realization from it doesn’t do anyone a service.

  3. I would love it if one day I didn’t have to worry about budgeting, but I highly doubt that day will ever come.

  4. “Once you become financially adept, learn what you want to spend your money on and not waste it on all those things that don

  5. You don’t budget, but obviously you take a concern for personal finances, else you would not be blogging on the matter. We don’t budget; we do the same as another responded. “we simply spend as little as possible, and we save the rest for when we need it.”

  6. yes figuring out what is important is a great thing 😉

    yesterday we were watching Judge Judy and someone had stolen this guys IPOD the guy tells judge judy he has ALWAYS wanted a IPOd and was devistated that it was taken away from him,

    DH and I looked at each other and said that is ridiculouse,Always wanted one? this guy looked close to 50,what a ridiculous statement , maybe some would understand his extreme desire but not us LOL

    I always wonder if the posters who are against people not buying junk are in sales or something,as I see no harm in slowing down the hamster wheel and enjoying life in a simpler manner, my Dh is your age and i worry about his heart health as I want him to stay with me

  7. “The secret to financial success is finding out what’s important to you” would have been a better title for this piece. I was a shopaholic for a long time because of the rush it gave me, but it was always fleeting. Saying you should find and actually finding what is important to you is a lot easier said than done. I’m getting better at it, but not there and I’ve spent years trying to figure it all out.

  8. I think you need to budget in order to find the things you want and the things you need.

    If you can write down all what you spend and make (budget) then you can see hey I spend $70 a month on Starbucks just because everyone else at the office goes on Wednesdays. You might not even like Starbucks but until you see the actual figure you don’t see that you can cut out that once a week trip to the coffee house and spend the money on something else that you really like…like getting an iPod or something.

    I put it in really simple terms above but it goes to show that unless you have a ‘budget’ you don’t really know what you are spending on. You might think you cannot afford the plasma tv that you really want because your account is always empty at the end of the month..but a budget will show you that you can cut out another amount somewhere else to do that.

    You do not have to be a slave to debt when you budget. The budget is a guide to managing your finances. I recently budgeted an amount for gas but then I tweaked it when the price of gas went up. My gas budget is a guide to help me see where my money is going.

    By the way the things that are important to some people ARE the big house and the fancy car.

  9. Exactly. Some people do want a nice car and a big house. You make a very poor assumption that people really don’t want these things. I think that most people do and that is why making more money so you can have all the things you want is so important.

  10. [i]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.[/i]

    Eh, it happened yesterday before I read this. I still cling to the notion that having money for tomorrow, for my kid’s university education, reducing my home heating costs, increasing my self-reliance, and paying off the mortgage are important goals. They’re not about upsizing what I have or taking on more debt. Yet where I am right now, I have to budget for these. But I probably don’t have to obsess about them while there’s real life and opportunities to help others through their pain.

  11. I understand where you’re going with this, don’t get me wrong, but the brilliant financial advice of spend less is really getting a bit old for me, no offense intended.

    Not everyone is at financial level in life. There are different stages, and this is obviously one of the later stages.

    However, most normal people require a lil’ bit of help. And a budget is the 1st step in that. No one is asking you to be a slave. It should just be a guide and be reviewed and tweaked when times change.

    Case in point, I started a new budget when I got my job a year ago. I monitored it for a few months then forgot about it. Then in 6 months, I checked again and noticed that my spending was still on point, so I forgot about it again.

    Lately, I started going out a bit more, so since then, I’ve looked at it and modified and tweaked my entertainment and gas values.

    That’s how you’re supposed to use a budget; as a guide to spending. Spend as little as possible: hmmph, getting real old.

  12. if you have a nice car and nice house already then what are you supose to want more than life itself? work for a better house and car , rinse and repeat till you die?

  13. @ Baz L

    I don’t ever think I said spend less or as little as possible — I said spend on what is important to you. Most people spend a lot on things that they think are important, but really aren’t (believe me, I know. I was there) and so the result will be to spend less, but not necessarily.

    I also mentioned in the first paragraph that budgets are necessary when you are first beginning and this is an ultimate goal.

  14. S. Shugars: You must have done something right in the earlier part of your life to be where you are today. Had you not watched your budgeting, you might not feel the way you do today. I personally know alot of people who wish they didn’t have a loose spending budget when they were younger (including me). I’m really having to catch up now because I was doing a lot of things I wanted to do. Budgeting is a guide and it can tweaked as you go along.

    One book that helped me was ALL YOUR WORTH by Elizabeth Warren. One of her points was to simplify your life into %’s and to make sure you were giving yourself enough wants. One problem with savers is that they can give to everyone but themselves. There has to be a balance. Living is for today also, not for just tomorrow. You may not be here tomorrow and then what did you enjoy while you were here?

  15. I personally would rather see a budget as a tool for discipling oneself from overspending. It sounds like semantics or that I’m splitting hairs, but seen in this way rather than stating the obvious, spending less, seems less like enslavement to one’s money and the direction it’s taken.

    My DF and I aren’t big spenders. Last year, yes, we spent a good deal of money from his social security disability lump sum and his inheritance as a result of his father having passed on. DF is disabled, so is on a fixed income. I was unemployed for a very long time. We needed a new washer and dryer; we purchased a set with cash. We needed a newer vehicle; we purchased a used one with cash. And so on and so forth.

    For us to manage our spending, the ideal thing is to set long-term goals such as replacing appliances. We’re going to have to buy a new refrigerator after we buy a home. I can “budget” – I prefer the word *allocate* – towards a new one in the meantime.

    I’d like to see myself as keeping track of where my money, not my spending, goes each month. Very little goes towards unnecessary spending.

  16. I don’t budget either; instead I keep track of my expenses. So long as I’m spending way below what I’m earning, I’m happy, whether that meant one month I spent $500 on groceries and the next month $200.

    I too have the same mentality that I don’t spend money just because it’s within the budget. Instead I feel it out, and see if the thing to be spent on is worth it. I have my goals, such as travel, or a house, and I also splurge once in a while, but when I do, it’s because it give me 100% happiness, and not simply because there is room in my budget for it. Because of the conscious effort that goes into my spending, I too tend to have the most joy in not wanting so much, and find that the things I enjoy the most are already free.

    It was from reading “your money or your life” that this awareness hit me, so thankfully I didn’t have to go through any bad things like a heart attack (I’m 28 years old).

  17. I find this entry to be more of a philosophical observation more than an advice piece. Learning how to manage personal finances is one of the major missing components to our public education system, and its absence is one of the reasons why we are (here in the US) experiencing such a mess with defaults/foreclosures in the housing sector. A great many people need to understand how to make money and how to save money before they can even begin to understand what this blogger is saying. In the wrong hands, the advice of identifying your absolute needs in lieu of a proper budget can be very dangerous–many people, including those who experience life-altering events do/will have trouble figuring out “what is important.”

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  20. @ the bill manager

    I’m not sure you read the article because I never said that people shouldn’t budget. I said the ultimate goal is to get to the point where you no longer need to budget. I have no problem if people disagree with me since they often do, but usually it is a disagreement about something I actually wrote.

  21. The real problem with America is that if you gave the average person $10,000 the FIRST THING they would do is start thinking of all the ways they could SPEND this money as fast as possible.

    In fact, they would probably use it for a DOWN PAYMENT on something and go deeper in debt.

    This is whats WRONG with our society. EVERYONE wants to spend too much money and they spend it TOO FAST.


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  23. I completely disagree. To me a budget isn’t restrictive in a bad way. It’s all about having a plan. It makes decision making a lot easier because it says “this is the next thing I’m saving for — my next savings goal — and any extra money from the budget goes here.” And that thing doesn’t necessarily have to be “stuff”… it could be building up an emergency fund or preparing to buy a new used car with cash, or paying off the home mortgage, etc.

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