I Hate Budgeting. Here’s What I Do Instead

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Budgeting is not something I find to be fun. Rather than setting a budget, I’ve taken a different approach by automating my finances. Find out more. 

I want to grow my net worth and end up with a large brokerage account balance. I also want to have plenty of money to do the things I value. But, I really do not enjoy budgeting. While I tried to live on a budget for years, I just ended up getting frustrated. I’d find myself often going over the spending limits I’d set for myself in certain categories and just give up.

Rather than continuing to fight a losing battle, I decided to take a different approach. I’ve stopped budgeting altogether, but I haven’t given up on accomplishing my financial goals. Here’s what I do instead.

Automating my finances works better than budgeting for me

Instead of budgeting, the approach I take is a simple one. I’ve made sure that my fixed expenses stay below a set percentage of my income, and I’ve committed to saving 20% of the amount that I earn.

All of these expenses are taken care of automatically. When my paycheck comes, on the day the money hits my bank account, I have arranged for it to be transferred to where it needs to go.

Typically, my first paycheck goes mostly to cover the monthly bills, like my mortgage payment and insurance premiums. I also autopay my utility bills, cellphone, internet, kids’ activities, and membership and streaming fees from my first check. My second one goes toward saving, including investing for retirement, saving for vacations, saving for big purchases, as well as a few other miscellaneous expenses.

All of this money to cover the basic essentials and to hit my savings target disappears as soon as I get it. I don’t have the option to spend it because it’s just gone. While I theoretically could opt to cancel my autopays, I have never actually done that because it’s a lot of work — and because I want to make sure my money is going where it needs to, so I’m not going to go to the trouble to undo something I’ve set up to make sure I do the right things.

Once my money has gone to cover the stuff I absolutely need it to, including savings, then I know I can spend what I have left in my account. Since I’ve already accomplished my financial goals before those funds become available to me, I don’t need to worry about budgeting them. I just spend them as I want over the course of the month based on what I want to do at the time.

Sometimes, this may mean dining out more or splurging on vacation or buying fancy clothes to dress my kids up for the holidays. Other times, it may mean putting some extra money into my vacation savings account. It doesn’t really matter, because what I do with this money isn’t going to affect my long-term stability, as that’s all taken care of.

I don’t need to think about budgeting any more, or limit my spending in any way, other than to check in once and a while and make sure I’m not exceeding what’s left over in my bank account.

Do you really need to live on a budget?

My approach enables me to avoid budgeting, and it can work for anyone who hates the “b” word like I do — as long as a few things are true.

You need to know how much to save for your financial goals and how much to set aside for fixed expenses, and you need enough money to accomplish that and still have funds left over to spend. You also need to be able to keep your spending on discretionary purchases to the amount you have left in your bank account, and you must commit to not turning off your autopays or getting into debt.

If you can do that, you may be able to avoid budgeting too. Just set up an automated system to get your money where it needs to go and enjoy spending the rest.

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