The one category in your budget that you don’t want to forget


One of the tasks you do when starting out budgeting for the first time is to come up with spending categories for your expenses. These are things like transportation, groceries, clothing, things that you spend money on throughout the month.

The choice of categories is a personal one. If you spend a lot of money on alcohol, it would be a good deal to keep that as a separate category. Go out to eat a lot? Ditto. Conversely, if you don’t have a pet, you don’t need a pet category.

I usually find that around ten categories is all most people need. Any more and you add needless complexity, but much less and you’re either not getting granular enough or you’re going to be forgetting something.

But I’ve noticed that there is one category that people tend to forget. This is dangerous, as its omission has the potential to wreck your entire budget.

Have fun

In short, you need a Fun category.

To recap, Income is where the money comes in. Bills are where the money goes out reliably. Expenses are what remains. And one of those things that remains is that you are a person and you have a life.

When starting out, many people are super gung-ho about the budget process, and think that they can pare down their life to the barest essentials. But if you don’t budget for a certain amount of fun, and you restrict yourself in this way for long enough, you will build up a pent-up need to enjoy yourself. So you’re more likely to say the heck with it and do something lavish, like take an impromptu trip to Vegas. After all, you’ve been so good for so long.

But I can tell you that when you put your vacation on a credit card, what happens in Vegas follows you home. When you get back, you’ll be more likely to get discouraged, and perhaps give up on budgeting entirely. Adding more debt on when you’re trying to pay it off isn’t a plan that ends well.

All of this could have been avoided by building in some Fun to your budget.

Not too much fun

If you’re in a really tight spot where you don’t have a lot of money coming in (or a lot going out), you may think that it makes sense to cut out all fun while you get things on track. Perhaps. But it’s important to realize that you can only be super intense about getting your finances in order for a limited amount of time. You might be able to live on nothing for a few months or so, but eventually, you’ll burn out.

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It’s important to realize that a budget isn’t something you do just to get you out of a crisis, and therefore it is not a good idea to think of it only in a short-term manner. When you make a budget you find money. It is a way of seeing what you value. You can direct your income with intention, which really means that you can direct your life with more intention

Because of all this, your budget needs to be sustainable. Burn-out isn’t an option. So you need to do what it takes to keep you on track.

Yes, spending a little money on yourself (even a little bit) might delay paying off those credit cards by a little bit. But since it will more than likely prevent you from blowing off the budget outright, on balance you will win out.

Just like living for today gives no thought to tomorrow, living only for tomorrow forgets that there is a today. So be smart, but be good to yourself. Have some Fun.

But enough about me. How do you balance your need to have a life with your obligations and plans?

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