Budgets Are For The Birds


No disrespect to J. Money, but in the Mad Money house we believe budgets are for the birds.  I have spent countless hours inputting guesstimated dollar amounts to be spent in every detailed category in the quest to create our monthly budget.  Each month was different, so it wasn’t set it and forget it.  Every dollar had a purpose, just like Dave Ramsey likes to spout.  Every cent spent was scrutinized to make sure it made it into our personal finance app, Mint.  I bought a cup of coffee?  It went into the Eating Out category.  Mini Monster needed clothes or a toy…it went into our Discretionary spending category.  How ridiculous was THAT category?  And, at the end of the month, we would rejoice in the fact that we didn’t go over our categorized budgets.  You know what it taught us?  It taught us that if there was any room left in any given category that we should spend more!  It taught us that budgets are for the birds!


We are following in the footsteps of other great frugal mavens that have come before us (Think:  The Frugalwoods).  We’re ditching our budgets in exchange for scrutinizing the necessity of each and every purchase.

Newsflash:  Eating Out does not routinely deserve a budgeted category when you’re on FIRE.

Look at this embarrassing breakdown.  This is a sampling of some of our former, ridiculous categories in any given monthly budget.  We used to be as happy as a pig in, well, you know, if we could stick to our allotted monthly budget.  These days, we have cut categories altogether in an attempt to trim our expenses, invest the rest, and retire early.

Sampling Of Ridiculous Categories
-Unexpected Expenses
-Funny Money (This was our Catch All category, including Eating Out)

Mr. Money Monster holding a Macaw with cash at a Mini Monster school assembly

Mr. Money Monster holding a Macaw with cash at a Mini Monster school assembly

The Proof Is In The Puddin’

Question:  Guess what happened when we allotted $200 each month for Eating Out?  Answer:  We spent $200 each month on Eating Out! *GASP*  Even worse, since we had all this money in all of these separate categories, we would borrow from Peter to pay Paul (old school biblical reference, but it works), meaning we would adjust our Grocery budget down and adjust our Eating Out budget up to accommodate our daily whims…which, by the way, would change as often as we changed our underwear.  Oh, the horror.

Mary Mantis!

Mary Mantis!

On The FIRE Track

I’d like to announce that we are now firmly planted on the early retirement path, through Intelligent Design!  We’ve gone to some extreme frugal measures to ensure we hit our goals.  We cut our umbilical cord to the cable company, stopped spending on unnecessary “necessities” like paper towels and seasonal family portraits (not that we ever did that last thing anyway).  We even came up with, what resembles, somewhat of a plan!

These days, we’re spending more quality time with each other without needing to waste money.  We’re taking walks together, making crafts together, and even raising insects together!  Not a typo.  And it is making all the difference!

What do you think about budgeting?  Is it more helpful or hurtful in your financial journey?

Mad Money Cat NOT loving his photo opp

Mad Money Cat NOT loving his photo opp

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39 thoughts on “Budgets Are For The Birds

  1. I really do think it depends on the individual or family. We create a zero-sum budget every month and it’s been amazing for us. It helps me visually organize our expenses and avoid lifestyle inflation. We have been doing it for more than five years. I love it! With that being said, I spend maybe an hour budgeting each month. It’s not a huge time commitment.

    Liked by 1 person

  2. Our budget is an elaborate spreadsheet that I squeeze periodically to see where I can get more money out of spending and into saving. It shows me the possibilities of money. In general, we move forward on “frugal autopilot” as Frugalwoods says. But creating that budget lets me know how much we make, how much our bare minimum expenses are, and allows me to decide which categories we’re okay inflating past that (food, for example, changes dramatically from month-to-month up here). But I get the aversion. I don’t allow it to justify crazy categories of spending or using up unused cash. I set it up to motivate me to put get the number in Savings above the number in Spendings. And my spreadsheets have worked wonders for me! :)

    Liked by 1 person

  3. We do an annual cash flow analysis and double check how we are tracking now and then. Most expenses like insurance, utilities, (mortgage), charitable giving are pretty regular and easy to track. We lump groceries + transportation + shopping together under the title “Household Spending” and audit it 2x a year using Mint.com. Keeps it easy.

    Liked by 2 people

    • We currently use Mint, too, to keep a general idea of what we’re spending and how our investments are growing. But, we no longer try to budget every tiny purchase, instead, we stopped buying everything that isn’t absolutely necessary. It’s working out well for us. I like the idea of Household spending. That would be much easier to maintain as a budgeted category. :)


  4. Oi vey! This hit home for me. We budget. We follow it, not to a T, because like you said we rob from Peter to pay for Paul. Part of that is we haven’t nailed down our real world adult-ing budget (graduated from college, moved across the country, cost of living is a lot different that what we both grew up with). We need to start analyzing is the purchase we are about to make in line with our financial and personal goals. Thanks for giving me something to think about on this day off!

    Liked by 1 person

    • Glad I could give you something to ponder on your day off :) We do, of course, track our spending and investing; we just don’t agonize over trying to predict where every single dollar might go each month. We know we do not buy ANYTHING unless it is absolutely necessary; therefore, we do not need to agonize over the categorization of every dollar. Happy budgeting :)


  5. I love it! I’ve been saying for years that for some people budgets only INCREASE their spending. Keep all expenses as low as possible and save/invest the remaining balance. Excellent post!

    Liked by 1 person

  6. Our budget was a pair of glasses for the blurry-eyed. We caught many unnecessary expenses in our first year married. We realized
    *we were eating out too much
    *I was spending too much on clothes
    *my husband had recurring ACH (OUCH) expenses that he had forgotten about
    *We could be debt free in 3 years, so we are
    *I could retire early and help with fiscal defense

    We don’t look at every tiny penny.
    I am the nerd, so I like to see where we can save (insurance, utilities etc)
    And the Mint graphics make me nuts.
    We use Excel and visit the budget quarterly

    Having a budget allows us to give more to those in need and frees each if us from guilt. He can buy some nice wines, and I know how much I can spend on clothes for both of us (I like to play stylist too)

    At first it did make me kookoo.

    We “zero-out” what isn’t spent into the smaller savings account for spur-of-the moment giving or travel

    Liked by 2 people

    • I like your approach. Although we refuse to track every tiny expense, as well, we do use Mint to have a general idea of where our money is going and how our investments are performing. We have also incorporated saving the leftovers of each month. But, if we were budgeting every single cent, we would likely not have any leftovers. That’s what we found when we were agonizing over our monthly budgeted categories. Love your insight!

      Liked by 1 person

  7. Interesting.
    Many people have a perpetual plan to start saving money, but they never do. They swear they’ll start saving 10 percent of their salary, just as soon as they’ve got the new car, computer, boots, mountain bike, Palm handheld, guitar, bracelet, or whatever. If you want to save money, you have to make a firm commitment and stick to it.

    Liked by 1 person

  8. You have to live within a certain amount of money each month. If you make $5,000/month you have to figure out how you will live within that amount. Some people will use a zero-sum budget, others will use a percentage : 50% bills, 25% savings and 25% for wants .

    Personally the zero-sum budget has not worked for me. I just use the percentage method because it doesn’t drive me crazy. Walgreens had a sale one day on Morton salt for .59 one week this fall. I went out and got it. If I had to follow one of those zero-sum budgets I would have had to record it.

    Liked by 1 person

    • Exactly. The zero-sum budgets are pretty impossible to stick to. We do generally know where all of our money goes. It’s little things like buying salt on sale that we don’t have time to deal with inside a tight budget. For us, we spend way less and invest way more without using one at all. :)


  9. MMM,

    I’ve had exactly the same experience! I’ve been tracking things with Mint for over a year now after going through a Dave Ramsey class. It’s totally useless! If you think about it, most of the categories we set are completely arbitrary in the first place, so then we adjust them weekly to fit real life, which gets in the way. Throw in inconsistent income and you’ve got a mess on your hands. I think everyone should track expenses generally to have an idea of where things can be trimmed if necessary, but in my experience, a zero-based budget just doesn’t fit with the volatility of life.


    Liked by 1 person

    • Obviously, I couldn’t agree with you more. Mr. Money Monster has a variable and unpredictable income so it was a total mess. It was driving us nuts. That’s why we just switched to not spending unless it is absolutely necessary. It’s been so much less stress and we’ve been so much more successful! :)


  10. Budgeting by inputting estimated dollar amounts into my spending categories also never worked with me, but then I discovered YNAB (You Need a Budget). Their budgeting philosophy and software revolutionized the way I think about and budget money. It has helped my remove a lot of excess from my spending and concentrate on paying off debt. https://www.youneedabudget.com/

    Liked by 1 person

  11. We are not budgeters either, and we’re saving a small fortune every month, so whether budgets are good or bad, they certainly aren’t necessary! We are devoted to paying ourselves first, and questioning expenses, and feel like those two things together are the only habits you really need to avoid overspending. Though tracking what you spend is never bad and can be highly instructive! Or, do what we do, and keep upping the amount of your money that automatically goes into savings and investments each month before you even notice it until you start to feel the squeeze on what’s leftover, and then live off that, while secretly saving a lot! :-)

    Liked by 1 person

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