I used to subscribe to the no need to budget lifestyle, then some major things happened like car repairs, a few medical bills and extra grad school payments and that knocked me back down to earth and made me realize I should keep a better track of my money. So far I am still working on my budget and trying to fine tune it. It is very eye opening to see how much money I actually spend on things like a frappucino from Starbucks and songs from iTunes.

There's a petitio principii lurking in that argument. If you do not have a budget how would you know then that you are spending wisely. Maybe you do not need to put it on paper but some kind of budget you must have.

Likewise with dieting, you need to keep tabs on what you're eating. That, in time can get you into the habit of eating healthy but a diet you are having, even unbeknownst to you. Mental budgeting does not mean not budgeting.

My two cents about this: budget, budget, budget. The key to any management programme be it the running of a company or a market stall is accurate record keeping. I had been for a couple of years wanting to shed 5 kilos to no avail. Then one day I started weighing myself everymorning and inputing the result in the plainest of spreadsheets in my palm. Two months later I had shed the 5 kilos and I have never regained then since.

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Errmm, no, actually you cannot.

To budget or not to budget? There is no question, although this is a do as I say not as I do situation. Not budgeting has gotten me nothing but trouble. Budgeting is definitely the right thing to do. The problem is doing it right.

Ostrauder
http://www.fightingdebtblog.com/

Folks, I was, and still am in some ways, a financial retard.
You have to budget. If you don't budget, YOU WILL NEVER BE RICH. Even if you win the lottery you will be broke few years later.

YOU HAVE TO BUDGET.

I did, and it has made ALL the difference.

This reminds me of a book that I read called _The Automatic Millionaire_, which gave good advice about paying yourself first, but it discouraged budgeting since it is hard. To the credit of such authors, they generally say that a budget is helpful, but their focus is to get people contributing to a 401k or 529 plan. For most people with financial illiteracy (I'm talking about 90%+ of adults) it is easier and more effective to invest into retirement accounts than to operate a household budget. I believe many of us who champion the value of a budget came to this way of thinking after "graduating" from basics, such as paying yourself first.

The "no budget" argument above really seems to be advocating what is also referred to as the "two line budget" wherein you decide what to SAVE first, then everything else has to cover your expenses.

I think that can work for some...but honestly I think the traditional budgeting process leads to awareness - and that can take you anywhere.

It seems lack of awareness of expenses (people always seem to know what their income is!) is what leads to financial mismanagement and debt. And I have often seen people *choose* to stay unaware.