I’m Not Making a Budget in 2023. Instead, I’m Doing This

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I’m experimenting with a new way to manage my money and work toward my financial goals. 

As someone who writes about personal finance, I frequently find myself advising people to start following a budget. Doing so is a great way to track spending and work toward different savings goals.

In fact, most years, my husband and I sit down in late December or very early January to map out a household budget to follow for the next 12 months. Our budget will commonly account for expenses like our mortgage payments, transportation costs, utility bills, food-related expenses, and leisure, to name a few.

Following a budget worked really well for us in the past. But as our kids have gotten older, we’ve found that some of our monthly expenses can be harder to predict.

For example, we used to budget $150 a year for soccer for each of our kids because that was the cost to sign up for the recreational season. But this past year, my kids wanted extra coaching and were invited to play in some tournaments that cost extra. Those weren’t expenses we had budgeted for, but we also weren’t inclined to say no.

Another thing that’s almost impossible to budget for? Home repairs.

For years, we’ve had a line item in our budget to account for things like appliances breaking or issues arising with our heat or air conditioning. But still, we almost never manage to budget accordingly and wind up dipping into our savings account when our repairs costs come in higher than expected.

It’s for these reasons that my husband and I have decided to try something new in 2023 — not following a budget. But that doesn’t mean we’re planning to spend money recklessly with no regard to our goals.

A different system that may be a better one

For the past few years, I’ve followed a budget only to get annoyed when I’d inevitably go over in specific categories. In 2023, I want to try something different — not follow a budget, but arrange for a larger amount of our paychecks to land in our savings off the bat.

My husband and I tend to divide our savings between a regular bank account, CDs, a brokerage account, and our respective retirement savings accounts. And we normally have a line item in our budget to allow money to go into these accounts regularly.

Next year, instead of following a budget, we plan to increase our contributions to savings so we’re funding those accounts at a pace we’re happy with. And from there, we figure we’re free to spend the rest of our earnings without worry or guilt. It’s a system that might make it possible for us to stick to our goals without having to get hung up on little details, like whether we stuck to our $200 cable and streaming budget each month or went over by spending $205.

A system you may want to try

If you’ve failed at budgeting before, you may want to adopt a similar approach to mine for 2023. Set a savings goal and arrange for enough money to leave your checking account each month to meet it. And then spend the rest.

Doing so might help eliminate some of the stress budgeting can cause. And as long as you meet your savings goal, that’s really all that matters.

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