The Truth About Budgeting
I hate budgeting. I hate following a budget, tracking expenses, and nearly everything that goes with it. But a proper budget can be instrumental in dealing with money troubles—if you do it right.
Two Approaches to Budgeting
When most people think about budgeting, they imagine making their life fit within preset categories and spending limits. That’s painful and not how life works. A wishlist on how you want to spend money is a recipe for disaster.
The best budget isn’t based on a wishlist—it’s based on a record of actual spending. Before you get down to real budgeting, you need to understand how you currently spend money. Armed with that knowledge, you can develop a spending plan that fits your life.
Think about it like this: the spending plan approach lets you gather data, make conscious decisions about changes you’re willing to make, and embrace the change. Traditional budgeting is just financial punishment if you’re not a chronic attention-to-detail person.
Which Approach Works Best for You?
The best budgeting approach is one that fits your money personality.
- Detail-oriented? — If you enjoy recording information and tracking data, constant updating of your budget will work well for you.
- Big-picture thinker? — If you’re not naturally attentive to details, try tracking spending for a couple months, then making decisions about changing habits.
Budgeting Alone Won’t Get You Out of Debt
If you’re hoping budgeting is the secret to getting out of debt, it probably won’t do the trick by itself. Getting out of debt takes a combination of increasing income AND reducing expenses. And you probably already know what expenses you could cut—you don’t need a fancy process to figure that out.
Don’t Cut All the Fun
A huge mistake I see: people create a wishlist budget that eliminates all joy from their lives. They think every fun expense is unnecessary. I think the opposite is true.
- Cutting all fun from your life
- Setting unrealistic “bare bones” targets
- Expecting perfection from day one
- Trimming entertainment from 4x/week to 1-2x/week
- Starting with manageable reductions
- Finding balance, not deprivation
The Bottom Line
Budgeting is a tool, not a magic wand. It should help you find balance in your life—not punish you for enjoying it.
Frequently Asked Questions About Budgeting
What’s the best way to budget if I hate budgeting?
I say on this page that I hate traditional budgeting too — and that a “spending plan” built from your actual recorded spending works better than a wishlist budget built from preset categories. Track what you actually spend first, then make conscious decisions about what to change.
Will budgeting alone get me out of debt?
No — the page is direct about this. Getting out of debt takes a combination of increasing income AND reducing expenses. Budgeting can show you where the money’s going, but it isn’t a magic fix by itself.
Which budgeting approach fits my personality?
The page splits it two ways: if you’re detail-oriented and enjoy tracking data, a constantly-updated budget will work for you. If you’re a big-picture thinker, track your spending for a couple of months first, then make decisions about what to change — rather than forcing yourself into a detailed system that won’t stick.
Should my budget eliminate all “fun” spending?
No. The page calls this a huge mistake — a wishlist budget that eliminates all joy from your life almost always fails. My advice is to start with manageable reductions (like cutting entertainment spending from 4x a week to 1-2x) instead of setting unrealistic “bare bones” targets from day one.
Is there a tool to help me find the budgeting approach that fits me?
Yes — this page links to the Money Personality Quiz, which is built around exactly this idea: your best budgeting approach depends on your money personality, not a one-size-fits-all template.
