I’ve never made a budget. I know that making a budget is something everyone says you need to do. But I’ve never bothered.
It’s not that I think budgets are bad or aren’t necessary. I’d argue that if you have debt or a decent amount of bills every month, you should budget. But I have neither of those things. Of course, not having a budget doesn’t mean you can get away with not figuring out a general spending and saving plan.
I’ve saved almost half of every paycheck I received this summer. I make sure I have enough each month for gas and my cellphone bill. Plus I spend about $50-$100 on eating out, movies, and other entertainment. Other than that, I just put random amounts into my various savings accounts. Isn’t that enough?
I think the biggest reason why I don’t budget is because they seem too serious. All black and white with no wiggle room. My general spending/saving plan fits me better. If I had student loans, a car payment, and a mortgage I’d probably budget more seriously. But until then, I like going with flow.
How about you? Do you have a serious budget? A moderate budget? Or no idea of what you spend each month?
{ 3 comments… read them below or add one }
Uhhh…it sounds like you do budget. You have few budget lines, but that’s normal for someone still living with their parents. Your budget look like this:
Income:
Census bureau $xxxx
Expenses:
Entertainment $50-$100
Gas $yy
Cell Phone $zz
Savings $remainder
It’s simple enough that it doesn’t need to be written down. As its complexity grows, you’ll probably find writing it down well worth the effort. The delayed effect of credit card spending, large fixed cost, and having credit facilities that let you spend more than you earn mean that regular tracking becomes necessary.
You’re still at a stage where checking your online banking will more or less tell you how you’re doing. Spread that money out to savings accounts, brokerage accounts, retirement accounts, a mortgage, a line of credit and student loans…without a budget and a means to check how you’re doing, and it can take months before you find out you’ve been overspending.
Oh, what I do.
When I first got an apartment, I had a strict budget. It laid out all spending and an ambitious savings target. I missed the savings target a couple of months, but made up for it in better ones.
After buying a condo, and getting a couple of raises, I became much more complacent. I know about how much my monthly credit card bills should be in order to still meet my non-credit card spending and savings goals. If the credit card is getting high, I let my wife know that it’s groceries only until next month. This is actually pretty effective…I’d guess far more stuff just doesn’t get bought at all, very little just getting deferred to the next month.
But the longer I’ve been on this system the slacker it gets. Turns out that it’s hard to keep track because my credit card also sees my tuition (which my employer reimburses), various medical things (which mostly get reimbursed by my insurer) and stuff I buy for a non-profit I volunteer for (also reimbursed). Throws my system for a loop, and when I get a lot of these kinds of charges in one month, I start to become kind of clueless about it.
My wife is quitting her job and going to law school in September, so it’s back to strict budgeting and regular progress checks.
I guess you’re right, LOL. I just don’t think of myself as budgeting because I don’t have any real limits. I think of budgeting as sitting down with Quicken and setting limits for every category of spending.