Here at How I Save Money I use a budget. I recently read a post that said Why You Do Not Want A Budget . I think this is one of the worst pieces of advice you can ever give someone, especially if they have debt.
This is honestly a rather disturbing article to me because it states that your finances will take care of themselves without any interference on your part . Now while I agree that there comes a point where your finances will be automatic you will still need to check up on things every once in a while to make sure that everything is running smoothly. You will need to do this in cases where you get a bonus or need to make an extra payment on something.
Baz from Life Of Baz actually has a budget and uses it..until the one time it failed him. He got so dependent on technology to track his finances that he never noticed that Money was not alerting him that he was over budget. Since he was not getting the red flags he assumed that he was right on track.
He looked under his budget today and noticed that he was actually over his budget on many items . Now this was not a big deal because he has discretionary income that can cover the excesses and he does not have to dip into savings or go into debt.
If he was in a situation where he did not have this free cash flow or an emergency fund then he would really have a problem. He would have been over his budget and might have to incur debt to cover his daily living expenses. Having a budget keeps you on track to know what you have coming in and what you are spending so that you can manage your money better.
His budget showed him that he was overspending on some areas that he could really cut back on and it also showed him areas where he was saving money so that he could use that savings to get the things he really wanted.
A budget does not mean that you are in a financial straight jacket but it does mean that you can monitor what you are doing so you can see that you spent $250 on dining out in one month….which is bad when you have a humongous amount of loan money to pay back for example.
Having a budget can show you ways to save money because you can find areas that you are spending more than you should and cut down on them.
I think that you should use a budget in order to help you manage your finances. It is just a tool to set you on the right path and I do not believe that you would be a slave to your finances as that other writer suggested.