One of my mom’s classic lines is “if the shoe fits, wear it.” If New Balance made a bad budgeter shoe it would fit me like a glove. So when my cousin asked me recently for some budgeting advice she must have thought that I would provide some soothsayer-like insight being that I write about money constantly and help produce a radio show about finances. However, being the bad budgeter that I am I could only give her tips that I know to be good but seldom use myself. That’s because I do not budget!
I think part of the reason that I’ve never been good at setting limits and sticking to them is that I’m cheap. I just don’t think about money in budget style terms. It doesn’t jive with my thrifty personality. My usual approach is to save as much as possible, get a good deal on the purchases I do make, and have a financial pad in my account for when the inevitable car or house malfunction occurs.
When I first got married my wife Em and I had a few hiccups because of the odd way I think about money. And I’ll admit, I wasn’t good at communicating my kookie cash intuitions to my new bride. So when she would want to go out for dinner or drinks my mind would rifle through all the things we had recently spent money on. If we had recently been austere with our funds I was more likely to approve of that meal out. If we had been a bit loose, I would get nervous and try to convince her that cooking at home would be a better idea (bet you wish you could have been a fly on the wall for that).
Communicating well about money is certainly important in marriage. I’ve learned that through some trial and error. So in the beginning as we really began to learn each other’s money habits, developing a budget together helped us to not make decisions based on whims, but on facts. We used Mint.com to keep track of all our spending. We would go through each month and compare our expenditures to the budget sheet that we had created. Now that we’ve been married for almost 3 years though we don’t really stick to “the budget” and it works well for us. But how can we do that?
We keep a mental note of the progress or lack thereof based on the information Mint is showing us. It gives us a snapshot – a frame of reference – of how we are doing. Mint is our favorite online budgeting tool even if we don’t use it the way most people do. We have all of our bank accounts and credit cards hooked up to it for quick and easy snapshots of our financial life.
We try to be as frugal as possible while still enjoying the things we love to do together. What’s the point of money if you continually deprive yourself now so that your 65 year old self can reap the benefits? Don’t call the retirement police, I promise, I’m still saving for the future. But if we deprive ourselves of everything now for the hope of a “comfortable retirement” I think it would be a big mistake.
We save more than we spend every month. Seems obvious but this is something that a large percentage of Americans don’t do! If you consistently find yourself spending more than your paycheck amount every month – or even close to it – you need to seriously consider becoming a good budgeter. You unfortunately don’t have the luxury of being budgetless.
We have built up a cushion that allows us flexibility. Over time we’ve saved so that when our giant great dane does have a vet bill that exceeds all rhyme and reason we are able to take care of it without freaking out.That takes time. If you haven’t started building up a cushion, start putting aside a little from each paycheck. You really need a rainy day account. Did you know that 30% of Americans have basically ZERO cushion? No savings at all! If you are one of them, start slow. You can do it!
So that is how I get by in life without budgeting. I know that to some this might be considered a cardinal financial sin. You guys think I’m crazy for going without a budget? What’s your budget stance?
[photo courtesy of Brent]