Do You Need a Budget if You’re Rich?

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Do you need a budget if you're rich? You might be surprised - knowing where your money is going is important, regardless of your financial status.

One of the things that always irks me is when people associate budgeting with being poor. That’s why when people say, “I can’t do that. I’m on a budget,” instantly people think it means they must not have that much money at all.

However, I tend to believe the exact opposite. If you’re on a budget or you took the time to even create a budget, all that really means to me is that you are aware of your spending. It could be a very large budget or a very small one, but either way it’s just a tool people use to become financially independent.

I’ve been budgeting for a quite a long time. It’s the namesake of my own corner of the Internet. Because of all the years I’ve been budgeting and what it’s done for my life, I made the decision long ago that no matter how much money I made, I would always have one.

Do the Wealthy Need a Budget?


One day I hope to be wealthy, more for the security of it than anything else, and I do believe my husband and I will be at that point in just a few years. However, as I said, even if I get to the point where I have more money than even I thought possible, I will still budget.

As a disclaimer, there are many people like Mr. Money Mustache and the Frugalwoods who don’t use a budget at all, but that’s because they’re so accustomed to being frugal they don’t need one. I personally enjoy a a mix of frugal choices and occasional splurges, so a budget keeps me on track and allows for splurges, like nice date nights, as long as they fit in certain parameters.

So, I really advocate for everyone to have a budget because after a while it can be easy for the wealthy to keep spending because they know they’ll be receiving a big paycheck. That type of thinking is dangerous, and it leads to big surprises when the credit card statement actually comes in.

With Great Wealth Comes Great Opportunity


The real benefit of having a budget when you’re wealthy is that it gives you an incredible opportunity to become even more wealthy if you budget. Basically, if you’re aware of your spending and you decide to cut back in certain areas, you can absolutely invest the difference and increase your wealth dramatically over time. You can use a platform like Personal Capital to help towards that end as it allows you to track your spending while also keeping an eye on increasing your net worth.

It’s no fun to make a high income if you have to keep working until your 70s just to keep up the lifestyle you prefer. Instead, be grateful for the opportunity you have to earn a high income and then use that high income to eradicate your financial problems and create an ideal life for yourself both now and in the future.

Do the wealthy need a budget? Yes! Anyone can benefit from knowing where their money is going.

It’s not about restricting yourself so much that you can’t enjoy anything; it’s simply about being aware of your spending so that every now and then you decide to pass on a luxury because you know you have other goals for your future.


Do you believe that the wealthy should have a budget? Do you think it’s okay to live without a budget? If you were wealthy, what would you use your money to do?

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Catherine Alford is the go to personal finance expert for parents who want to better their finances and take on a more active financial role in their families.


  • Thomas @ I need money ASAP! says:

    Everyone needs a budget. Or at the very they at least need a natural ability to control their spending. That includes the very wealthy. Just ask some of those lottery winners who blew it all in 2-3 years!

  • Mrs. Frugalwoods says:

    I really like your assertion that it’s not about restricting yourself–that’s how I feel too. For me, not spending is a way of freeing up my money (and my time) for the pursuits that are most meaningful to me. Debt is a trap, frugality is not.

    Even though, as you mentioned, we don’t budget, I’m a huge fan of budgeting in general and I think it’s a wonderful tool. I’m all about that expense tracking! Thanks so much for the shout out 🙂

    • Cat says:

      That’s true. Your expense tracking is sort of like a budget or at least you know where everything is going!

      • catherine says:

        Also, though the frugalwoods don’t necessarily budget pen and paper there’s a mental list constantly going on. It wouldn’t take them until the end of the month to realize if they’ve overspent on groceries by $500. The biggest part of living on a budget is being financially aware, which they are but for most people it’s a conscious effort.

  • Laurie @thefrugalfarmer says:

    I think there are the occasional people like the FWs that can manage well without a budget, but I believe most people will spend mindlessly if they don’t have one. Even us, in our frugal ways, will spend more on household improvement that we need but don’t really need if we don’t keep track. But probably my fave thing about having a budget and spend-tracking is that we can go back and review and see where changes can be made.

  • Kathy says:

    We don’t budget in the strictest sense of the word, in that we do have spending goals written on paper and we track our spending. However, we are not so rigid that if we run out of milk and all the grocery category is spent, we get milk anyway. Not that we are ever that bad, but we do go over in different categories from time to time. No panic, however, because we also have reserve funds to fall back on. When we budget $250 for utilities and that month they are only $200, the extra $50 goes into the reserve fund where it sits until some month when the utilities cost $300 and is used to pay the extra. I think even the wealthy need to track their spending. A budget isn’t punishment. It is your very own plan for what you want to do with your money. No one else can make your budget for you and therefore shouldn’t be thought of as restrictive. It is simply a tool.

    • Cat says:

      I’m not super rigid either but I do try to stay within the parameters. Since having kids I often have to go out and buy wipes or milk or what have you even if I’ve used up all the baby fund that month. I just let it slide because they need those things!

  • canadianbudgetbinder says:

    You nailed it when you said a budget can help you become even more wealthy. Before my wife and I started using our budget back about 4 years now we were your typical “Frugal Couple”. I often say that if we would have implemented a budget sooner we would have saved more money because we would have known our numbers. Without tapping into that numbers source we likely wouldn’t be debt free today. The budget “for us” has sped up that process to debt freedom. It’s different for everyone based on what goals you aim for. What works for one might not work for another.

  • Aldo @ Million Dollar Ninja says:

    I think everybody should budget somehow. Some people are frugal enough that they already know they are budgeting (mentally), but most of us need a written budget to stay in track of our goals. I am a firm believer that you should treat your finances like a business and all businesses have a budget.

  • Kalie says:

    We do a yearly budget but not a monthly one because we take the “spend as little as possible” approach instead. Then we’ll look back over expenses to see what we can challenge and cut. I think the budgeting question isn’t so much about how wealthy you are but your financial personality. If you’re an extreme saver by nature, you might graduate from the budget.

  • Elroy says:

    I think most people would consider us wealthy, and we budget. Things can get out of control really fast if don’t!

  • Mrs. Maroon says:

    I firmly believe that a budget is just how you spend your money. We all have one. No matter what it looks like. Personally, we choose to monitor ours closely and spend far less than we earn. But that is certainly not the only example of a budget. If you consider a budget to be restrictive and denying you the things in life you enjoy, you will come to loathe it. On the flip side, if you can embrace a budget, it can become one of the most valuable tools in creating the life you want to live – wealth and all!!

  • Abigail @ipickuppennies says:

    Everyone needs some form of budget. As your money increases, you can loosen that definition if you want.

    We’re doing okay, so I have a general spending outline. But I don’t track every cent or which categories the money comes from. As long as we stay within the approved spending limit, I consider that a budget.

    It’s not ideal, but after lots of trial and error, I’ve found it’s the best I can manage.

  • Gen Y Finance Guy says:

    This post has perfect timing. My wife was just telling me this morning that she was talking with one of our friends that invited us to a concert in October.

    My wife was excited for the invite but told our friend that we couldn’t buy the tickets until May because of our budget.

    Our friend was immediately concerned for us and wondering why we were on such a tight budget.

    The funny thing is that it has nothing to do with being able to afford the tickets, but like Elroy said above, things can get out of hand quickly. We have a lot of expenses going out during March and April and we are making an effort to control any discretionary purchases.

    What makes me laugh inside is that now they are going to start making up these stories in there heads that we are in some sort of financial trouble. Little do they know we have $40K in the bank, bring in almost $15k/month in income, contribute $1,800/month to retirement accounts, and are on a 7-year plan to pay off our 30 year mortgage.

    We don’t talk about money that much because they live so differently than us. They just are not use to us saying things like this.

    Thanks for the post.


  • Adam @ says:

    We don’t have a budget, just mainly focus on automating all the saving up front. However, I’m sure if we got on a strict one, I’d probably find some additional savings.

  • Kim@Eyesonthedollar says:

    I think it depends on how you view wealthy. Lots of people who look wealthy are really terrible with money. We probably used to fit into that category of looking like we had more money because we had more things. People like that need a budget as much as someone who makes very little money. I think if you can avoid debt and tons of monthly payments and put away your savings and investment money first, budgeting becomes less important. Right now if you gave me a million dollars, I would not spend any more than I do currently, budget or not.

    • Cat says:

      I totally agree with you on the looking wealthy but being terrible with money thing. I was more talking about actual wealth as opposed to people who wear their wealth.

  • How To Save Money says:

    Yes, I think so! Even if you’ve got sooo much money, you’ll just burn through it if you don’t have a budget.

  • Gary @ Super Saving Tips says:

    While I don’t believe everyone needs a budget (some people just have an innate disciplined approach to their spending), I think a budget helps most of us spend our money according to our priorities. This only becomes more important with greater wealth. More money equals more opportunities to either achieve our goals or go astray.

  • Shannon @ Financially Blonde says:

    It depends on where their wealth comes from. Wealthy people whose wealth comes from their salaries, definitely need a budget. I have a bunch of clients who make great salaries but can’t save anything because they don’t budget. Then I have wealthy clients who built their wealth from saving and like the Frugalwoods, they don’t need it because they live a lifestyle that supports the continuing generation of wealth rather than the depletion of it.

  • Bryan says:

    Ask any pro athlete that has gone broke if they needed a budget. Mike Tyson is the poster child for this. He went through 300 million dollars!

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