What Budget?

This may sound strange coming from me, the queen of financial responsibility, but I don't like budgets. Plans - yes. Approximations - yes. Estimates - yes. Budget - no. So why all this hate towards something every financial planner swears by? Well I'll tell ya. No one ever stays on budget. You only ever hear of people going over budget. If by some miracle someone does stay on budget, it's not because they have a budget. It's because they didn't have any surprise expenses or they didn't have any extra money to spend beyond the budget.

That's the thing with budgets. Everyone seems to think they are some set-in-stone amount that they absolutely can not exceed. But when it comes down to the wire, they always seem to find a way to get more money and go over budget. That means that budgets mean nothing. They are like a promise that isn't kept. Budgets are only what people WANT to spent, not what they CAN spend. That's why they never work.

If you had $1,000 to spend, but you only wanted to spend $100 of it and save the rest, how long do you think it would take to find excuses to go over your $100 'budget'? 'Well there's sales tax, and that will bring the price over $100.' 'I found this really cool thing for $125, and that is only a little over $100.' Pretty soon, you have spent the whole $1,000 and you have no idea how it all added up so fast. I know everyone doesn't think about money this way, but I think the large majority do. In America, if you want more money or more credit, there is almost always some way to get it. Therefore, the budget is always unlimited. If you want to limit the budget, you have to limit yourself, and most Americans don't seem to be so good at that.

I'm not saying it isn't wise to plan how you will spend your money. I just don't like the word 'budget'. Budgets never work because people can't limit themselves. So plan, save, appropriate, invest, and estimate, but NEVER, EVER, BUDGET.