In my opinion, the backbone of a successful personal financial plan is the monthly budget. It’s the map – the blueprint – to financial success. Instead of just reacting to money problems that suddenly pop up, a budget prepared in advance tells your money what to do and squeezes every bit of value out of each dollar. We work too hard earning a dollar to want anything else.

Yet, only 32% of families prepare one each month. Let’s take a look at many of the most common reasons they don’t budget.

1. People hear “budget” and think “bread and water”

Many people don’t like the limits they feel a budget will place on them. Understandable but incorrect if a budget is done the right way. This negative assumption is why I try to call it a spending plan instead of a budget. Is this just a word game? Yes, I suppose. But whatever it takes to help people get it done!

Personally, I’ve found a budget to be the exact opposite of confining. It’s really liberating! How so? Because it frees me to spend totally guilt free because I know other dollars are already allocated to all of our expenses. The fear I’ll run out of money before the month runs out is gone.

2. They are afraid of what they’ll find

Budgeting can be scary at first. You may not want to find out the cost of your latte habit. However, sticking your head in the sand isn’t the answer. Knowledge is power. Deal with the truth and move on.

When we first started budgeting, I was shocked – shocked, I say – to find out how much we were spending on food (both groceries and eating out). No one likes to face cold, hard facts like these, but because we did, we were able to reduce our spending in this area. And truth be told, it really didn’t change the quality of food we eat. It just made us more efficient in how we use our food dollars.

3. Budget abuse in the past

Some people have used the budget process to abuse others. In reality, the budget was just another tool they used to manipulate and control others.

Unfortunately a lot of good things (like budgets!) have been misused. That doesn’t make preparing a budget bad. It just makes the abuser wrong! Don’t tarnish the benefits of a budget due to someone misusing it in your past.

4. Pride

“I don’t need to do a stupid budget! That’s for poor people.”

Wrong! Dave Ramsey says he still prepares a written budget every month and he’s far from poor. We have a responsibility to be good stewards of our resources, whether the resources are large or small.

Don’t let your financial future be harmed because of your preconceived notion about who needs a spending plan. We all do.

5. Laziness

Let’s be honest. I totally understand how easy it would be to let budgeting slide. A streaming movie and quart of ice cream (or my food vice, a bag of potato chips) sounds much better than doing a budget. A lot of people have to fight off laziness each month to get the budget prepared.

Budgeting is like many other processes we do each month. Understanding the benefits of budgeting and building the habit are the keys. I may feel too lazy to go to the grocery store, but I understand the benefits of eating and I’ve kind of grown accustomed to it!

Now that I’ve personally experienced the benefits of budgeting, I can’t imagine living without it. One of the reasons I could retire from full time work at 49 was because we budgeted each and every month.

If you enjoy being lazy, imagine how much more time you’ll have to lay around if you can retire early (just kidding, laziness isn’t a plus for anyone).

6. Don’t know how to prepare one

Effective budgeting can seem daunting to start. Do I do it on paper or on the computer? How detailed do I need to make the spending categories? How do I handle the irregular expenses? And so on…..

Here’s a suggestion: Don’t try to figure it all out before you even get started. Trust me, you won’t. Start from where you are and well… just start. A simple list of things you need to spend money on that equals the amount you have coming in that month is a great beginning. Over time you can refine it. My budgeting process looks a lot different now than when we started.

Don’t let the fear of starting keep you from doing so. You’ll never get better until you dive in!

7. Past failures at budgeting

Maybe you have tried in the past and it bombed big time. No worries. Try again!

Few really valuable and meaningful things come easy the first time you try. Did you get a scrapped knee learning how to ride a bike? If you’re like me you did. But if you don’t get back on the bike you’ll be sitting on the curb watching the other kids have all the fun.

Get back on the budget bike! You learn by doing. Falling off the budget bike is OK. Not getting back on isn’t.

8. It will lead to marital fights

I have to be honest. The first few budget meetings I had with my wife didn’t go well. We both came into them with our own expectations and they didn’t necessarily match up. Part of a great marriage relationship is working together on tough things. It also includes putting our spouse’s needs ahead of our own.

Once my wife and I stumbled our way through the first few budgets, we noticed it getting easier and easier. And we noticed that we both found some things to like about the budget. That’s what marriage is about – working together to make a better future for ourselves and our families.

9. I’m a free spirit. Budgets are for nerds.

I can use the word nerd here because I am one. Not a nerd in the classic sense (I hope) but a financial nerd in that I like numbers. Look, I’m a CPA. A thrill for me is a column of numbers that adds up properly. I get that. I also get that a lot of people aren’t like me in this regard.

They still need to do a budget, though! Maybe more so as their “free-spirit-ness” may lead them to a lot of impulse buying.

The budget isn’t designed to squelch their free spirit. It’s to let them enjoy some impulsiveness without going into debt in the process.

10. I’ve got plenty of money left over at the end of a month

Maybe you’re one of the fortunate ones who have ample cash flow. Congratulations. All the more reason to budget! Extra cash laying around in your account is so easy to let slip between your fingers. Maybe one day your cash flow will be less and you’ll wish you had a few of those “extra” dollars you let float away in earlier years.

As mentioned earlier, we have a serious responsibility to manage our wealth. Having a lot of cash doesn’t decrease that responsibility… it increases it. Can you have a larger amount of blow money each month for fun things? Sure. But if you don’t have a plan, the blow money can blow a hole in your long term plans.

Whatever the reason you don’t budget, rethink it. A great budget doesn’t have to be pages and pages long (ours is only one page – front and back). And it doesn’t have to take long.

🤔 Think about it this way: If your budget improved the efficiency of your monthly spending by just 5%, what would your effective pay rate be for that one hour of work? Probably your most profitable hour of the month!

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    Jul 10, 2021 6:31 am

    Thanks for linking to my article!

    Business Cash Flow
    Oct 3, 2018 8:35 pm

    I totally agree with what you said. I think that some people are just lazy to do a budget which I also think is wrong. I think that it is very important to do budgeting in order to have a proper finance management. Thanks for sharing this article.

    Mar 5, 2016 8:48 am

    My bank account has a ‘track spending ‘ & budget tab. It has the ability to look at 12, 6 ,3, 1 month or custom time frames. It displays a graph and % in each category, plus the ability to reassign purchases (yes I split out buying gas vs the snack I also picked up at the gas station). It is a great tool to help on the way to budgeting.
    Great insight on the 10 reasons!

    Mar 5, 2016 2:09 pm
    Reply to  Jacq

    Thanks, Jacq. It sounds like your bank has a really great tool to use to track your spending. Imagine how much further people’s money would go if they kept a close eye on their spending. When we first started tracking our spending years ago, we were shocked at how much we spent in a few categories.
    Keep up the good work!