Most people cringe when they hear the word “Budget” and many people deny that they even need one. Budgeting lies at the foundation of every financial plan. It doesn’t matter if you’re living paycheck to paycheck or earning six-figures a year, you need to know where your money is going if you want to have a firm handle on your finances.

Unlike what you might believe, budgeting isn’t all about restricting what you spend money on and cutting out all the fun in your life.

It’s really about understanding how much money you have, where it goes, and then planning how to best allocate those funds.

If you’ve resisted the idea of establishing a personal budget in the past, perhaps you’re clinging to one or more of these favorite reasons not to budget:

1. You prefer playing Russian Roulette with your bank account. The idea of possibly receiving a nasty call from your bank or having your debit card refused at the time of purchase is an adrenaline rush, like financial bungee jumping. So knowing how and where your money is being spent would make life rather bland.

Me? I have found more productive ways to add excitement to my life, like an annual Disney or beach vacation – which our budget allows us.

2. You’re rather fond of old myths like; “Budgets are too much work” or the ever popular, “I don’t have time.” Taking an hour a month to manage the money you worked 160+ hours to earn seems just plain foolish.

The phrase “easy come, easy go” bothers me. I may be the exception, but spending 2,000+ hours a year to make a living hardly qualifies as easy in my book. It definitely seems worthwhile to spend an additional 1% of that time managing the special resources that have been entrusted to me.

3. You think that because you don’t have a problem paying your bills, you must already be the best possible steward of your finances. No room for improvement, and no possible way you could lower your expenses.

It’s estimated that people who create a budget as an integral part of managing their personal finances can find as much as 5% more money they could be giving or saving. That’s because most people simply don’t know where the majority of their money goes.

I find it instructive that even the tennis great Serena Williams has a coach. What’s that go to do with budgeting? If the best tennis player in the world realizes that she still needs help and can benefit from some accountability, surely our finances can too.

4. Your crystal ball offers you a perfect view of the future, showing you in advance when unexpected financial crisis are headed your way.

That must really come in handy – the rest of us have to actually plan for life’s unexpected and irregular expenses.

You know, like the hot water heater needing to be replaced, or the dishwasher giving out three days before the company arrives for Christmas dinner.

A budget simply tells your money what to do instead of wondering where it went every month.

You may think that you don’t really need to create a personal budget. After all, you manage to meet your bills on time each month and you’ve even managed to save a little. That’s more than many people can say, but a budget could produce some additional benefits.

1. Control: Money makes a good slave but a poor master. When it comes to money, you want to be in control. If you let your finances rule your life, you will always fall short of reaching your financial goals.
2. Knowledge: You know how much money you have and where it is going, right down to the last penny.
3. Opportunity: Having your financial life in order enables you to see opportunities that you might have otherwise missed.
4. Organization: Even the simplest of budgets systematizes and organizes your finances.
5. Stress Reduction: Money issues are the most common cause of marital discord and family tensions. By communicating openly about money, as budgeting forces one to do, there is less chance of money issues complicating human relationships.
6. Time: All your financial transactions are automatically organized well in advance of tax season, or in the event of a tax audit, saving you precious time hunting down the receipts and statements at the last minute.