desk with money stacks and calculator to manage money

You Don’t Have to Make a Budget If You Don’t Want To

dana miranda c e p f ® Jan 13, 2022

Making a budget seems like a no-brainer when you want to get your money under control. But conventional budgeting methods have some serious flaws. 

Most of what’s out there about budgeting expects you to have stable income and expenses, tells you what your priorities should be, relies on deprivation and makes you track every cent that leaves your pocket.

Budgets make money no fun — and way harder than it needs to be.

Through Healthy Rich, it’s our mission to make money easy.

In this guide, we share our favorite money management tips that have nothing to do with budgeting. Or restriction. Or counting pennies. 

We’ll cover:

  • What is money management?
  • Why budgeting doesn’t work
  • The myth of “wants versus needs.”
  • Restriction-free money management.
  • How to manage your money without budgeting (12 tips).

We’ll share lots of tips, tricks, tools and experiments to help you manage money better, so we recommend bookmarking this page to come back to as you figure out which money management strategies work best for you.

What is money management? 5 things that matter

Let’s start by understanding why you want to learn to manage money better. In most cases, money management strategies aim to help you get (or keep) these areas of your life under control:

  • Debt: Paying off student loans, mortgages and old credit card debt and using credit cards without racking up more crushing debt.
  • Expenses: Paying your bills on time.
  • Savings: Building nest eggs for big purchases, unexpected expenses and retirement. 
  • Spending: Having enough money to buy the things you want and do the things you want to do.

And there’s another area of money that’s rarely talked about alongside money management but it’s a vital piece of this puzzle we can’t ignore:

  • Income: Where your money comes from and how your choices can increase or decrease the amount.

Wholistic, inclusive and values-based money management helps you find an income that’s balanced with your commitments (expenses) and goals (debt and savings) and lets you spend freely without worry.

Why budgets don’t work

Most advice about money management is founded on the mindset embedded in budget culture, a damaging set of beliefs that good money management is about restriction and deprivation.

We know budgeting doesn’t work.

New budget fads keep rolling out, yet the average person is still accumulating debt, ignoring the future and fretting about money every day.

A lot of financial experts want to point to you to explain why your budget isn’t working — but it’s not your fault. Budget culture supports mindsets and methods that are fundamentally flawed. 

Budget culture:

  • Rewards restriction and deprivation, which are unsustainable.
  • Ignores the dynamics of income, interests and spending.
  • Demonizes spending — which is the whole point of money!
  • Categorically labels certain money moves as “good” or “bad” for everyone.
  • Values efficiency and economy above human health, happiness and wellbeing.

Instead, we focus on the reality and diversity of our relationships with money — and teach you how to wrangle (and love) your finances with budget-free money management.

The myth of ‘wants vs. needs’

An insidious thread in budget culture is the idea that you can categorize your spending into “wants” and “needs.” It’s a key step in most budgeting methods.

Have you ever tried it? Do you find it infuriatingly frustrating to try to label everything in your life according to whether or not you truly need it? I do.

That’s because this categorization is ridiculous. Yet, financial experts list it as a step to creating a budget as if it’s possible and even straightforward.

How on earth do you even define “need”? Is it about survival? Comfort? Mental health? Your responsibility to the planet? Career success? Family obligations? 

If you can even settle on a definition of wants versus needs, clearly dropping each of your expenses into one of those categories is still usually impossible. You need food for sustenance, but does it need to taste good or be organic or come in a variety or be sourced ethically or be sold by a business you care about?

The myth of “wants vs. needs” assumes money exists in a vacuum, but that’s not how life works. The choices you make about how to manage money are entangled with every other part of you and your life.

Get rid of the restrictions

At Healthy Rich, our foundation for money management is a restriction-free approach.

Our strategies encourage and celebrate thriving, rather than starving.

We don’t support or endorse money management tips or tools that set spending limits, attempt to categorize spending, name your priorities for you, label any kind of spending as “good” or “bad” or in any way make you feel like you’re not good with money.

Money should be easy.

It shouldn’t be a source of stress or anxiety. It shouldn’t make you feel shame or guilt. It shouldn’t be more important than your need for joy or comfort.

Managing your money should feel simple, fun and freeing, regardless of your circumstances.

How to manage your money without budgeting

How do you keep your money under control without setting restrictions and counting pennies? It’s completely possible!

Here are our favorite ways to manage money without creating a budget.

1. Map your money

If budgeting is creating a ceiling for how you can use your money, money mapping is opening a door to the outside and discovering the sky’s the limit for how you can use your money.

That’s because money mapping focuses on the big stuff that really matters — instead of how much you spend on lattes and shoes.

Mapping your money gives you a financial snapshot, so you can see how money fits into your life in a bigger way. It lets you see where your money comes from, where it’s going and what matters most to you.

This snapshot shows you what you’re working with, so you know which steps to take to get to where you want to be (like, buying bigger lattes and more expensive shoes).

Use our Money Map worksheet to list:

  • What’s coming in?
  • Where’s it going?
  • What are you working toward?
  • What’s free to spend?

Once you see where you are now, you can use your Money Map to figure out which strings you need to pull to make changes. Do you need to bring more money in? Can you move, reorganize debt or cancel some services to spend less? Do you want to adjust some financial goals to tie up less money in debt payoff or savings?

2. Use a Yes Fund

Our Yes Fund strategy for money management is an anti-budget method that helps you focus on conscious spending rather than restriction.

A Yes Fund is a metaphorical bucket for your spending money — and it has no limit.

We know restrictive spending limits on things you love are an impractical money management tool. They’re arbitrary, unpredictable and hard to stick to. Plus, they’re kind of like a punishment for yourself, and what did you do to deserve that?

Still, your cash flow isn’t infinite, and many things cost money. A smart money management strategy ensures your financial goals and commitments are taken care of so you can spend freely without fear.

That’s where your Yes Fund comes in.

Your Money Map helps you see what you’ve got coming in, direct it toward commitments and goals and see what’s leftover — that’s your Yes Fund.

Your Yes Fund is the money you can spend on anything, anytime, without worry. Your bills are covered, your debt is being paid off and your savings are growing. This bucket comes with no requirements or restrictions. 

Finding your Yes Fund could require regular money mapping and math — but the easiest way to find it is to automate bill payments and savings contributions so your money is mapped for you, and you don’t have to think about it. 

3. Automate everything

There’s no better feeling in life — in my humble opinion — than knowing a task is taken care of for you. You can shed the emotional labor of remembering to get it done and even the labor-labor of doing it at all.

You can automate almost everything when it comes to money management.

Before you object, let me clarify: This doesn’t necessarily mean auto-pay, which I know can be a nightmare of unexpected overdrafts and outdated account information.

Auto-pay is one way to automate your money management, and it’s a lifesaver for some people. Schedule with service providers to draw money out of your account when bills are due, and you never have to think about that bill or deal with missed payments.

This strategy is great if you tend to have a big cushion in your bank account, so you don’t risk an overdraft from a payment you weren’t thinking about.

If your bank account runs a little closer to zero, you can still automate by setting reminders for bill payments. You’ll have to manually initiate payments, but you can avoid spending any more time thinking about the bill than you need to. Set a reminder in your calendar on payday to schedule a bill payment or move money to a special bucket for upcoming bills, and set another to pay it when the bill is due.

Don’t use calendar reminders? Try a spreadsheet. List the bills you pay from your first paycheck of the month and those you pay from the second, and get in the habit of checking the spreadsheet each time you’re paid.

You could do something similar with a notebook or paper ledger, if you’re still partial to handwriting bills.

You don’t need robots to get money off your mind — it’s all about finding ways to cut out the emotional labor of remembering and doing math. Free your brain!

4. Use (some) money management apps

Most money management software and apps are built on a foundation of budget culture, so beware of relying on them completely to manage your money. But I’m all for tools that take work out of your hands, and a lot of money management apps automate tasks you might otherwise avoid altogether.

Here are a few apps you can use to support inclusive and values-based money management:

  • CreditKarma and Credit Sesame give you a snapshot of your debts and credit report.
  • Providers helps you manage paychecks and public benefits in one place.
  • Lifesaver tracks the impact of your spending and makes it easy to donate credit card rewards back to causes you care about.
  • NerdWallet’s app lets you see your credit score, net worth and cash flow in one place.
  • Prism tracks and reminds you about bills and lets you see your bank account balances in one place.
  • Banking apps like Aspiration, Daylight and Cheese reward you and help you track spending in line with your values.

5. Keep a diary — temporarily

Constant expense tracking is a tedious way to manage money, but a limited-time experiment with spend tracking could help you better understand your relationship with money. 

Take a week to keep a diary of your expenses. You don’t have to go through the trouble of setting up a new app. You can do this with pen and paper (or a blank document, if you prefer to use a keyboard). 

Follow these steps to track your expenses in a valuable way:

  • At the end of each day, look at your bank account, credit card transactions and cash receipts, and jot down where you spent money and how much.
  • Next to each item, add a few notes about what you bought, why you bought it, how it made you feel and anything notable about the experience. This could be anything — from how long you waited in line at a local cafe to how convenient it was to buy socks on Amazon at 3 a.m.
  • After five to seven days, take stock. Create rough categories for your spending, place your transactions into the categories and rank the categories from most to least spent.
  • In your journal or in conversation with a friend or family member, reflect on your spending. Do your high-spend categories align with your priorities and values? Do they align with what brings you the most joy?

6. Get to know your money mindset

Most money management techniques are too rational. They expect us to make perfectly reasoned and calculated decisions every time, and guess what? Humans don’t operate like that.

How much money you make, how you spend it, what incentivizes you to change and what motivates you to plan ahead all have little to do with numbers. They’re all about your relationship with money.

Changing any money habits starts with understanding your money mindset

When you understand how you think and feel about money, you can understand why you make the choices you make — and change what isn’t working for you.

7. Name what matters to you

Managing money in a way that feels satisfying and productive for you starts with conscious spending.

Spend as much as you want on whatever you want — but check in with yourself occasionally to see how that spending impacts your life. If it’s not making you feel good, make a change.

A simple step toward conscious spending is to make a list of what matters to you. Write down your highest values, interests and goals. And, by the way, be honest with yourself. List values that truly matter to you, and leave off anything that comes to mind just because someone else expects it of you.

Keep the list handy on your desk, on your phone or in your wallet, and check in once in a while. Do your most recent purchases align with the life and the person your list represents?

8. Pay yourself first

There’s really no need to track every dollar you spend or even, as some financial experts recommend, to “give every dollar a job.” Counting dollars is tedious and does nothing to support your financial goals.

An easier way to manage your money and achieve your goals is to pay yourself first, so it doesn’t matter where the rest of your dollars go. 

Paying yourself first means allocating portions of your income toward your commitments and goals automatically. For example, saving 10% of every paycheck or automating debt payments.

An easy way to pay yourself first is through automation, which works great if you’re paid through a regular paycheck, especially by direct deposit. Set up direct deposit to split your paycheck between a savings and checking account, schedule bills and debt payments to auto-pay, and set up an automatic contribution to investment accounts.

If your paydays aren’t that straightforward, our Money Map can help you streamline paying yourself first, so your commitments and goals are covered, and you can spend freely from your Yes Fund.

9. Focus on what’s coming in, not on what’s going out

You can’t budget your way out of not having enough money.

If you want more — a bigger Yes Fund, a faster route to your goals, a more luxurious home, more choice at the grocery store, more comfortable travel, more time freedom, more ease — you might need more money to make it happen.

Don’t leave income out of your money management equation. Bringing in more money gives you a bigger pie to work with, so you don’t have to choose among your priorities and your goals.

Income comes in tons of big and small forms, and you can get creative to find ways to increase it in your life. Here are a few ideas to get you started:

  • Ask for a raise at work.
  • Apply for a promotion or higher-paying job.
  • Apply for unemployment benefits.
  • Start a side hustle, like freelancing, consulting or selling something you make.
  • Work with a gig app.
  • Raise your rates with clients.
  • Use credit and debit cards that offer cash rewards.
  • Apply for public benefits, like SNAP or Social Security disability income.
  • Apply for financial aid if you’re a student.
  • Learn a new skill.
  • Enforce a child support or spousal support order.
  • Earn a certification or degree.

Plus, we can all work to ensure everyone has enough income to cover their commitments, goals and spending by supporting public policies like increased minimum wage, basic income and child tax credits.

10. Avoid restriction and deprivation

Budgeting’s biggest downfall is its reliance on restriction and deprivation. Most methods require you to deprive one area of your life to support goals or commitments in another. That gets tough to maintain when you start to feel the strain of deprivation.

When feelings take over, your ability to deprive yourself of comforts is depleted fast.

Just like with other habits you want to change, one splurge outside of the restrictions you’ve set can lead to self-doubt and convince you to give up altogether. You end up back where you started: spending mindlessly and never satisfied with what’s in your bank account until you feel guilty enough to try total deprivation again.

This cycle of extremes gets you nowhere. Leave restriction and deprivation out of your money management plan, and opt for conscious spending and paying yourself first instead.

11. Create a comfort fund

Part of paying yourself first, a comfort fund is a store of money that eases your financial stress. It’s not earmarked for anything, and you don’t use it for everyday spending, so it’s there when you need it, like:

  • In case of unplanned medical needs.
  • If you need to walk away from work that doesn’t serve you.
  • When you’re faced with a surprise car repair.
  • You lose income unexpectedly.

Set a number that makes you comfortable, even if it’s arbitrary. It might be based on your typical income or expenses, your monthly rent or mortgage payment, or any other measure — or nothing at all. 

The right number for a comfort fund is any amount that gives you the freedom to make life decisions without money weighing in.

12. Be willing to experiment

Above all, money management has to be pliable to be sustainable. Your needs and goals are always changing, so your relationship with money and your financial habits need to change, too.

Avoid setting hard rules and reprimanding yourself for not sticking to them. Instead, try on money management methods for a week or a month at a time to see how they feel. Keep what works and drop what doesn’t. Moving on isn’t failure; it’s learning and growth.

You might come back to some methods periodically — maybe certain habits work well for you during summer and others during winter, some Monday through Friday and some on the weekends. Maybe you return to some strategies you haven’t picked up in decades because you’re again living without kids to take care of.

The keyword here is experiment. Try new things, adapt ideas to your circumstances, keep what works for you and drop what doesn’t.

Strengthen your money management skills

Money doesn't fit a tidy set of rules. It’s a mindset, habit and relationship unique to each person, and it morphs with the seasons of your life.

There are as many “right” ways to manage money as there are people with money to manage. Managing your money in a way that feels easy, joyful and stress-free is about finding the moves that work for you and keeping an open mind to notice when they need to change.

Avoid restrictive budgeting and the self-doubt and judgment that come with budget culture. Instead, aim for conscious spending, and manage your money in ways that help you say yes to what matters most to you.

Dana Miranda is a Certified Educator in Personal Finance® and creator of Healthy Rich. She’s written about work and money for publications including Forbes, The New York Times, CNBC, The Motley Fool, The Penny Hoarder and a column for Inc. Magazine. 


Image byTima Miroshnichenko via Pexels

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