When is it Time to Stop Budgeting?

Budgeting is the first stop for most people getting started managing money. But is it guaranteed to work? Here's how to tell it's time to stop budgeting.

A very common piece of financial advice is to budget. Plain and simple. You need to know where your money is going, you need to know how much you have coming in, and you need to balance your expectations against reality. A budget can help with all of that.

While that’s true, I argue that budgets simply aren’t for everyone. It’s one of those conventional pieces of financial wisdom that doesn’t apply to every single person out there. I learned that the hard way.

You see, by nature, I’m a fairly frugal person. I always look for ways to save, and I don’t spend my money without analyzing every option I have. As you can imagine, shopping with me is a ball as I stand there in the aisle, painstakingly comparing prices and ounces and generic brands. (Shopping adventures with Erin.)

My “financial personality,” if you will, doesn’t lend itself well to a traditional budget because I get way too focused on the numbers. If you manage your money in a similar way, it might not be for you, either.

The Problem With Budgets


Before I get started, I want to get a little disclaimer out of the way: budgets are great for the majority of people who aren’t paying any attention to their money whatsoever. It’s a highly recommended starting point for a reason.

However, if you’re already super frugal, or if you feel guilty when you spend your money, then I argue you can get by without one.

How do I know? I tried a little experiment back in 2014. I was blogging regularly and got caught up in the monthly budget reports that everyone else was doing. I realized that I wasn’t budgeting the same way as other people were, and wondered if that was detrimental to my financial situation.

So instead of just tracking my money each month, I decided to try the traditional budget route. I typed out all the categories I wanted to include, went back through my past transactions and figured out what a good “estimated expense” was, and then filled out what my actual spending was throughout the month.

Sounds good, right? The problem with budgeting, at least for me, was that I got completely lost in the numbers and failed to think about the larger picture. My budget allowed me to focus on one month out of the entire year, and if that one month wasn’t going well, I felt horrible about my financial situation as a whole.

Don’t Miss the Forest for the Trees When Budgeting


The worst mistake you can do with anything related to personal finance is to get so lost in the details, you lose sight of your overall journey.

Here’s what happened to me: week after week, I entered all my transactions, and I would get discouraged whenever I was close to or exceeding a certain category…even if it was by $5-$15.

I am extremely hard on myself in all aspects of my life, and money is no exception. The worst part? I wasn’t even close to living paycheck-to-paycheck; I had a decent buffer in my checking account just in case anything unexpected happened.

Yet, that didn’t matter. I felt shame in reporting my budget on the blog when things didn’t go according to plan. I had only meant to hold myself accountable and attempt to become a bit more aware of my spending habits throughout the month. I didn’t think tracking my spending was active enough as I usually waited until the end of the month to tally everything up.

I also didn’t take a full view of my budget. For example, I may have spent $20 more than I budgeted for groceries, but $25 less for gas. That didn’t matter. All that mattered was that I couldn’t stick to my grocery budget. I just beat myself up over every dollar I spent over my “estimated” limit.

I also have perfectionistic tendencies (which is silly, I know), and I was too stubborn to increase my budget in certain areas because I was confident I could lower my spending. It was just a matter of executing it. Try telling that to life, which totally loves going according to plan! (Sarcasm.)

That’s a horribly unhealthy relationship to have with money, which is why I decided to stop budgeting and continue to only track my spending. I haven’t looked back since, and my financial situation hasn’t suffered. If you’re like me or if you’d rather have someone else help you track your spending and monitor your finances, a free online tool like Personal Capital can help you manage your money without getting mired in the details or overwhelmed by the sheer idea of budgeting.

The Budget That Isn’t Super Focused on Numbers


Many people would find this ridiculous on all different kinds of levels. I made a lot of mistakes when trying to budget (even people who love money management make mistakes!), and I’m glad I learned from them.

The biggest takeaway for me was to keep the focus on what makes me happy. At the beginning of 2015, I created a list of about five values that were non-negotiable for me. I was allowed to spend on these (within reason, and I can trust myself not to go wild) as long as I cut everything else out.

Due to the fact I’m already focused on saving as much money as possible, and on paying off my student loans at an accelerated pace, it works. That’s why this method isn’t for everyone. If you’re prone to spending your paycheck before you even have it, then I wouldn’t recommend it.

However, if you’re like me and you tend to obsess over the financial details that don’t matter to your long-term finances, and need to focus on feeling good about spending your money, then you should give it a try.

Other Numbers that Can be Misleading


In personal finance, numbers aren’t always cut and dry; they rarely tell the entire story. Don’t let numbers have that much power over you. It doesn’t make for a fun time, trust me!

A great example that comes to mind is your net worth. A lot of people check this on a quarterly basis to see how their financial situation is doing. Are they on the right track? What has changed and why?

Checking up on your net worth can be great, but if you love your numbers, you need to do it in moderation. There’s always the potential for huge swings to happen in the market, and chances are, your net worth now could be drastically different from your net worth six months from now, depending on what you’re invested in.

Another example? Your salary! I know it’s cliche and some people don’t like to hear it, but it’s not always all about what you make. Someone could be earning six figures and saving none of that, while you could be earning $40,000 and saving 20 percent of your income. Who is better off in that situation?

Lastly, your credit score is another number that you’re judged on, but doesn’t always tell a creditor everything about you. Perhaps you’re very responsible with your money otherwise, but hit a horrible rough patch and haven’t had a chance to recover. Or maybe you’re super rich and spend, spend, spend, so good credit isn’t difficult to have. That doesn’t mean you’re crazy responsible with your money!

Budgeting is the first stop for most people getting started managing money. But is it guaranteed to work? Here's how to tell it's time to stop budgeting.

Appreciate the Numbers, but Don’t Live By them


Bottom line: numbers are good for measurement, but don’t get lost looking at them for too long. Your focus should be on the long-term game plan, not just this month or this year.

Life throws us curveballs. It’s rare everything goes according to plan, and to try and plan for that is insane.

Instead, go with the flow as much as possible. Control costs where you can. Be a conscious consumer. But don’t write your efforts off if you miss the mark ever-so-slightly. We all have bad days/months/years. The beauty of personal finance is that you can bounce back from financial mistakes, learn and do things differently.

Use your numbers to help you figure things out, but don’t think you’re doing something wrong if you find budgeting a certain way doesn’t work for you. Experiment, fail, evaluate and get back on the road toward financial freedom!

Additional resource: If you’re looking for a simple way to stay on top of all your finances without having to live by a traditional budget, then check out my favorite tool – Personal Capital. Completely free, it allows you to track your spending, monitor your bank and investment accounts and watch your net worth grow plus many other tools. 

Open a free Personal Capital account today!


Have you ever taken conventional financial wisdom into consideration and been burned by it? Do you enjoy budgeting? Why or why not? What method of budgeting do you use? 

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Erin M. is a personal finance freelance writer passionate about helping others take control over their financial situation. She shares her thoughts on money on her blog Journey to Saving.


  • I also do not have a concrete budget and have felt guilty being in the personal finance community. But like you, I save aggressively and am a conscious spender. For people like us, I think budgets are not as essential. I often find that my spending stays about the same every month anyway. The most important thing for me is that I am hitting my yearly savings goals.

    • Erin M says:

      It sounds like we’re on the same page! My spending tends to stay the same as well, and I know I’m saving money each month (and putting extra toward my student loan debt).

  • Money Beagle says:

    I think everybody should have a budget. However, I will agree that the traditional approach for a budget might not be for everyone. But, even if your budget is just a tracking budget and even if it has two lines: Income and Expenses, I think you’re fine. At the very least, I think EVERY person/household should know what they’re bringing in compared to what they’re sending out. Anything above that, I could see a case that some might not need that, but you can’t ever convince me that everybody should at least have that.

    • Erin M says:

      Well, it depends on what your definition of a budget is, and that’s going to vary from person to person. I wasn’t keeping an actual budget, but I was tracking my spending and income. I just wasn’t telling myself “you only have $X to spend on Y this month.”

      Knowing, on some level, where your money is going and how much you’re bringing in, is always a good idea. It boggles me that some people have no idea how much they make!

  • Ha ha, I felt like I was reading my biography, lol. It’s weird my site mentions budget in the title, but I pretty much work by the same principle. I call myself a loose budgeter, because we only adjust our budget once or twice a year. All of our non variables are set in stone so I sorta set it and forget it. Everything else is what’s leftover after our savings have been taken out so we pretty much use it for our non variables. I absolutely freak out when I have to sit down and write everything that I possibly spend money on. All that thinking is too much for me. I am trying to get Personal Capital situated, just so I can see how it works.

    • Erin M says:

      Yep, I keep a “loose budget” as well. Back when I had time to sort through all my transactions, I didn’t mind the actual process of writing everything out, but I wasn’t focusing on the right things. My relationship with money has been rocky and it was just making it worse. Having that automated system (Personal Capital/Mint) helps a lot!

  • I don’t follow a traditional budget either because it seemed too tedious, and I’m very cautious when I spend my money anyway. My husband recently went on a (rare) shopping trip with me so I could pick out some new running shoes. He said it was “painful” to watch me make the decision to spend that money, a process that ended up taking a couple of weeks before I decided. But I personally love that I’m so cautious with my money, because I save so much in the long run!

    • Erin M says:

      That is pretty much how I shop, too. 😉 I take forever to make a decision about anything over … well, in most cases, $40ish. Buying a new laptop took me 2 years. I love it and hate it because analysis paralysis can be a roadblock. Earmarking my savings for goals has helped a bit!

  • All excellent points! As a depressive, I was getting too hard on myself — and too panicked — when we couldn’t live by the budget. And two people with chronic conditions have a very hard time knowing how much to budget. Medical expenses can be ridiculous one month and moderate the next. But the disparity is too difficult to project for, since flare-ups happen. And since we were both sick a lot, convenience food was the order of the day (no pun intended), so it was nearly impossible to plan a realistic food budget.

    Nowadays, we just put a lump sum of money into the account each week and do our level best to live off that amount. Large unexpected expenses go on the credit card, to get paid off when I get my check. As long as we’re still putting money into savings each month, I’m happy with this method.

    • Erin says:

      I’m glad I’m not alone in being hard on myself with budgeting! When I moved, the budget pretty much went out the window for at least three months as random things kept popping up. It was so hard to deal with. I have to imagine that medical expenses are even more difficult to manage. =/

      At least you found a method that works for you! I have a large buffer in my checking account just in case, so I’m never at risk of overdrafting, and I always make sure I’m saving something every month.

  • That’s a great point–I’ve never had to write out a budget, because I rarely spend money on anything other than necessities (groceries, rent, etc).

    However, it could still be argued that I’m on a budget–just not an explicitly stated one.

    I did crunch the numbers a while back, and made a post about how I live on less than $10,000 per year (here: So it’s certainly a tight budget, but it’s do-able for me, in a pretty inexpensive area of the country.

    • Erin says:

      Nice! Living on less than $10,000 is awesome. I’m jealous of your rent. Living in an inexpensive area has its pros and cons, but definitely more pros when it comes to the price of your living situation.

  • While my family has a budget, the budget itself has a cushion just in case something happens. If we don’t consume what’s in the budget, then, the money goes straight to the checking or savings account.

    What I found with budget is that when it’s too restrictive, we tend to go over. When it’s too loose, we lose track of our expenses. That’s why we just put a small cushion in our budget.

    I believe that budget is necessary but it may not always be for everyone. I am saying this because some people’s finances are pretty straight forward and some are complicated. For those with simple finances, may be a budget can be supplementary but not a requirement. Whereas, for those who have complicated finances, then, budget may be a must.

    • Erin says:

      Yes, it’s always going to come down to your personal situation. I admit I have a fairly simple financial situation compared to most people, and I try to keep my accounts to a minimum.

      It’s good that you’ve experimented enough to know that you need a cushion for a “just right” budget, and it’s great that you use the surplus to fund your savings!

  • I budget everyday using YNAB. I manually enter in my purchases from the day before and keep track of every single last little penny. Obsessive? Yes. Necessary? Also, yes. I’m walking a fine line right now in terms of income vs. expenses, and I haven’t fully broken out of the paycheck-to-paycheck cycle yet.

    I like to think that someday I won’t have to budget, that my budget will train me to spend better now. But, in reality, I think if I ever stopped it would slowly creep back to pre-budget days and I’d be up shit creek again. So for now, at least, I’m budgeting onwards!

    • Erin M says:

      That’s really awesome you know yourself and your spending habits that well, though. It always comes down to knowing what works for you, and it sounds like what you’re doing is definitely working. Congrats on making progress and sticking with it!

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