Stop thinking budgets limit you.
There’s a common trend I’ve noticed, especially in the military, where people think: “I earn enough money to not have to live paycheck to paycheck, so I don’t have to budget.”
That’s true. You don’t have to budget. But why make your life harder than it needs to be?
Here’s what I’m talking about…
A Story About a Friend
I wrote almost this exact same article a couple years ago, and I talked about actual cost, opportunity cost, and hidden cost. These are all important topics, but I’m going to keep it simple today.
It comes down to the most basic fact: Your money will go farther when you budget. #truth
What sparked this article? I was talking to a friend about budgeting, and he told me his wife didn’t want to set limits. He said she thought they made enough to not need to limit themselves, and he knew whatever limits he set, she wouldn’t follow.
That’s got to be frustrating.
Back to my friend. He said whatever limits he would set, she wouldn’t follow, because she would at least want to be involved in the process… but the problem was that she didn’t want to be involved in the process. It was a catch-22 situation to say the least.
So that sparked this post. I’ll also write about what to do when your spouse isn’t on board, but for now I want to address the lie that budgets are limiting.
Why Budgeting Isn’t Limiting
There are many kinds of budgets.
So you have options.
If you’re lazy, simply automate all the important stuff (e.g. giving, saving, investing, bills, etc.) and spend what’s left. If you’re extremely meticulous, use an old fashioned spreadsheet and track every penny. If you’re somewhere in between, do what works for you.
Budgeting stretches your dollars to go a step farther. You have limits on each category, which gives you a freeing feeling to know what you can spend where. While it takes months, or years, to make a budget work well, once you get there, there’s no better feeling in the world.
And don’t forget about “blow” money. You should have a “blow fund.” No, I’m not talking about cocaine, Scarface; I’m talking about money that you get to blow on whatever you want. You and your spouse should each have this.
Common Budgeting Limit Complaints
So what do you do about you or your spouse feeing this way? Here’s some ideas:
- Think you should be allowed to spend more than your limit? Consider raising the limit for that budget item. Maybe it was too low from the beginning. If you think it’s a reasonable amount, it may just be about the authority of the budget. People feel like budgets tell them what to do, but you set the budget to improve your finances. It’s here to help, I promise! And you create it. You tell it what to do.
- Think you should be able to buy something that’s not in the budget? That’s where that non-cocaine-related “blow fund” comes into play! Set a certain amount each month to spend on whatever you want. If you want something big, that just means you have to save your money for a few months, but you’ll get there.
- Think you have so much money that you don’t need to budget? That’s a shame. You’d have so much more if you budgeted. Budgeting really does give you more opportunities. Set your category limits higher if you want, but that small amount into your savings and investing will be worth the budget alone. Pay yourself first, automate it, and budget the rest.
- Simply hate the word “budget”? Don’t tell J. Money; he still thinks they’re sexy. You can call it The Financial Spendingizer 2000, The Financial Freedom Creator, or “a sheet where we write down numbers.” Whatever works for you, but don’t be brainwashed into not budgeting because of a word that brings back poor memories.
Whatever your complaint is, I promise a budget will extend the life of your money.
Budgeting Brings Awareness
The primary reason you budget is for awareness and mindfullness.
You can save a lot of money by being aware of what you spend, just like you can lose weight by being aware of what you eat. It’s one step that can make a huge impact.
We often go through life mindlessly, and don’t even realize we have financial issues, until they get serious. You can avoid that with a budget.
If you absolutely can’t stand to look at a spreadsheet, or use a budget tool, at least track your spending. That awareness alone will do you a lot of good. And it will make you realize how much farther your money will go if you budget.
If you absolutely still refuse to budget,
fine, be a baby! I didn’t want your finances to change anyways. See if I care! you can try automating it once in the beginning, and then letting it ride.
If you decide to start planning and budgeting to make those hard-earned dollars stretch, check out: The Complete Guide to Control and Save Your Money.