In my experience, there is almost always a simpler way to handle these cases that involves being able to put a file in gitignore. This is one of the big advantages of environment variables, for example - they can typically be stored in a .env file (with a .env.default file checked in for new developers to copy from), and loaded dynamically in different configuration systems.

If my local setup requires me to ignore changes in checked-in files, I usually find that I need to handle configuration more cleanly.

(I did work on a project that made use of git update-index - this was a terrible mistake and caused pain every time we needed to update the config file in the repository. Please never go down this route!)