I try to spend at least some of my time hanging out with people who are more successful than I am. And with hot chicks.

Usually on Fridays, when I’m done with the chips, I head over to my Dad’s office. He (along with his business partner) runs a multi-million dollar business out of a run down retail outlet. The business is primarily real estate driven, between the two of them they own all sorts of properties. There’s an apartment block, many rental houses, and even a trailer court owned between the two of them. Unfortunately, the trailer court is devoid of a banjo-pickin’ inbred sitting on a rocking chair named Cletus.

Throughout their working careers, they worked blue collar jobs. One worked for the railroad for years. The other for a farm machinery dealer. One tried his hand at selling real estate (with only marginal success) while the other ran a taxi. Neither man had the benefit of making six figures per year until fairly recently, when they had both already built up impressive balance sheets.

What’s the secret? Did they receive large inheritances from random great uncles? Were they extra sexy and sold their bodies for lots of cash? (That did not bring up a pleasant mental image) Did they start a crappy frugality blog and sell it for 7 figures? No, there were no get rich schemes involved. They simply lived cheaply, invested intelligently, and slowly accumulated assets. The power of compounding took over, and today they’re in an enviable position, at least financially.

As we talked on Friday, the subject of budgets came up. You guys should already know I don’t have one. Those of you who have one spend hours per month coming up with amounts you can spend on certain categories, all to try to end up with some savings at the end of the month. I, meanwhile, simply pay myself first and live on the difference. I accomplish the same thing, all in about 5 minutes a year. It’s smart, it’s simple, and I think you’re all suckers for not doing it. As long as we accomplish the same goals, who cares how we get there?

My problem with budgets used to be like my problem with forearm tattoos. The problem existed, I just didn’t care enough to do anything about it. I still haven’t done anything about the forearm tattoo thing, (except ranting about it during some Saturday Morning Dump like a year ago) but I gotta do something about the budget thing.

Getting back to the conversation on Friday, do you think the two wealthy guys I was talking to have ever had a budget? OF COURSE NOT. Think about the truly wealthy people you know. How many of them have a budget? I’m willing to bet it’s not very many.

Rich people generally become wealthy because they’re committed to the goal of accumulating money. They simultaneously spend time working harder and finding ways to spend less. They know they can supercharge their savings by focusing on both sides of the equation, so they do. Frugality becomes a way of life for the aspiring wealthy. Spending money takes them further away from their goal, so they try not to.

Meanwhile, let’s look at the average budget. There’s categories for things like rent, utilities, food, and the like. These are true necessities, so I’m not going to argue with those categories. But what about allotting money for entertainment? If you give yourself $100 per month for entertainment, are you going to spend it simply because you’ve allocated money for it? How about your budget for eating out?  Is your budget really doing all it can to save you money?

When I look at the bloggers I know who make budgets, there’s only one I know who is legitimately on their way to becoming wealthy. Formerly Fabulously Broke, Serena from The Budgeting Tool has a net worth approaching $200,000 – and she’s only in her late 20s. She’s pretty pro-budget – after all, she named her new blog after the budgeting tool she created. There’s no doubt that creating a budget has helped her create wealth. But do you know what’s 5 times more important? The fact that she’s maximized her income and cut her expenses like some sort of frugal nut. The budget is only secondary.

How many monthly spending updates do you read where bloggers completely crap all over their spending goals? Yes, I realize stuff happens. But shouldn’t emergency funds take care of that stuff?

Instead of having a budget, can I suggest an alternative? This may be a little extreme for some of you, but if you’re not serious about building wealth, I’m surprised you’re even here. Instead of allocating certain amounts of money for expenses every month, focus on cutting the crap out of those expenses.  Entertainment? Screw entertainment. Work more and use the library.Want a fancy iPhone and the $70 plan that goes with it? Not if you’re going to rich.

Of course, you’re probably not going to want to give up those things. That’s fine, then you gotta make sure you really maximize your income, and plug holes in your spending. If you spend extra on your cell phone, then maybe you should drive an older car. If you spend lots of money on people preparing food for you (like I do) then maybe you should cut your clothing spending to less than $50 per year. (It helps that work gives me a credit towards buying clothes, but still.)

The point is, you’ve got to maximize your saving. I’m don’t think a budget is the way to make that happen.

Tell everyone, yo!