Christian Budgeting, Finances, Savings

The Dreaded “B” Word: Living on a Budget Doesn’t Have to be Torture

  • Dave Ramsey Financial Peace University
  • 2012 27 Jul
The Dreaded “B” Word: Living on a Budget Doesn’t Have to be Torture

Do you have too much month left over at the end of your money? Do you wonder where your money goes? It’s not hard to get control of your finances.  The solution: make a written budget. Yep! I said the dreaded “B” word. A budget is something you’ve got to do, no matter how much money you make, in order to build wealth. You have to be intentional with your money. You have to happen TO it…and that means every month, on paper, on purpose you tell it what to do, or it will leave you!

Some people view budgeting as a form of torture.  But a correctly prepared budget is neither torturous nor time consuming.  In fact, if you make a budget that works, you can actually get more free time and money to enjoy!

It Is Not a Weapon

The household budget is NOT a method of manipulation for one family member over another.  I know in some households the term has a negative connotation.  But you have to realize that that approach is the misuse of the idea.  It is the reflection of the character of the manipulator, not the concept of cash flow control.  A good plan comes from the input of all family members.  

I Said, “Written” 

Sometimes I have callers on my radio show who say “Well I kinda sorta know where my money is, ya know. I know what it is going to do, ya know. I do my planning in my mind, ya know.” Having a written plan is absolutely necessary.  Most experts agree that an accurate plan can first be developed in two to six hours and should be maintained in less than fifteen minutes a week.  Keep it simple.

The Clearing of a Fog

Developing a written plan can actually help you find the answers to what you perceive as problems right off the bat.  An accurate picture of where your money goes is just the first benefit of having a written budget.  Something mystical happens when we commit something personal to writing.  We tend to live out those plans.  I’m not saying that if you commit to a written plan you’ll automatically start doing everything on the list to a “T.”  But clarifying your goals and aspirations, and then facing financial realities, changes the way you see your situation.  When you see what must be done, you will begin to move in that direction as a matter of course.  Honestly, the only way most of you will ever see that exotic vacation, one that you probably deserve, is to have a written plan that controls household income and expenses to enable you to begin saving for it.

Write out the details.  Include a “blow” category.  You need to plan to blow, waste or not account for some portion of your money.  If you do not plan this, you will do it anyway.  A regimented plan that is too tight is not realistic.  If you don’t allow some cushion in your plan, you will fail.  Then you will say that budgets don’t work for you.  

The Envelope System

The envelope system is a good way to control the “variable” things in your budget. If you have trouble figuring out where your money goes, the envelope system is the best way to track it. After you complete your budget on paper, put the money for some of those fluid categories in an envelope system. We use our envelopes for food, entertainment, etc.  But it can work for everything in your budget, including savings.  You can save for something like car repairs by placing the money in there every pay day.  This way when the car unexpectedly breaks down, you have the cash to cover it. 

To this day you could stop my wife on the street and ask to see her envelopes and she’ll pull them out of her purse.  The Ramsey house still operates under this tried and true practice of cash flow management. It’s the easiest way to do record keeping especially if you have trouble balancing a checkbook or tracking debit card receipts.  You will never spend more than what is allotted in your envelope.  When it’s gone, it’s gone.

Commit for Ninety Days

A good money plan lives and moves, is dynamic, and changes as your life changes.  You will need to do a review every month to make adjustments before the month begins.  You have tried doing it your way up until now.  Why not give my suggestions a real opportunity to take hold?  I’m asking you to try or commit to a written plan for ninety days.  And I mean commit.  You commit not to let anything else pull you away. If you do not set out with a firm commitment, you will probably give up within the first three weeks.  If you stick with it for ninety days, I promise you will work out the kinks and your financial life will never be the same.  

Dave Ramsey is America’s trusted voice on money and business. More than 1.5 million families have attended Financial Peace University in more than 30,000 churches nationwide. He’s authored four New York Times best-selling books: Financial Peace, More Than Enough, The Total Money Makeover and EntreLeadership. The Dave Ramsey Show is heard by more than 5 million listeners each week on more than 500 radio stations. Follow Ramsey on Twitter at @DaveRamsey and on the web at

Publication date: July 27, 2012