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Old 12th January 2020, 09:26 AM   #1
Faydra
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YNAB

I'm 61 years old and am financially speaking, I'm an idiot.

Don't get me wrong, I own a really nice house (me & the bank) and I have a respectable amount in my 401K. If I had found YNAB 20 years ago I think I'd be in much better shape, probably would have my house paid off and no debt.

Ynab is budgeting software, stands for "You Need A Budget". A friend of mine suggested I try it out and it has really changed my financial life for the better.

As a person with spreadsheet-itis, I've done budgeting countless times. Here's what's coming in this month, here's whats going out. Done! Except that things change and **** happens and it's not valid for every month.

YNAB's theory is that you only budget the amount of money you have right now and you give every dollar a job. Then when things change its super easy to move money from a less needed category to cover what you just had to spend.

Now I'm never broke, but I can be YNAB broke, which is a much more comfortable broke to be, because I know the important things are covered.

I put all my bills on autopay for the first time in my long and financially stupid life.

Feels SO good. All thanks to YNAB.

Highly recommend it.

Last edited by Faydra; 12th January 2020 at 09:27 AM.
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Old 12th January 2020, 03:48 PM   #2
Ampulla of Vater
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I made my son get the app. The personal finance sub on reddit recommends it highly, which is where I came across it. Sadly he hasn’t utilized it yet. He said, in a tone of disbelief, that it appears he is expected to enter every penny he spends. Well of course it does!
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Old 12th January 2020, 03:53 PM   #3
Orphia Nay
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It's not going to work for me if I have to enter every cent I spend.

Or can you link your accounts to do that for you?
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Old 12th January 2020, 05:40 PM   #4
Faydra
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Originally Posted by Orphia Nay View Post
It's not going to work for me if I have to enter every cent I spend.

Or can you link your accounts to do that for you?
Yes, you can link your accounts if you want to. Some people don't like that, ynab will do it either way.
I'd never do it if I had to enter each transaction.

Last edited by Faydra; 12th January 2020 at 05:41 PM.
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Old 12th January 2020, 06:24 PM   #5
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One of the things I really like that it does is this.

Say I've budgeted $50 for a widget.

I find the perfect widget and I buy it on my credit card.

Ynab takes that $50 dollars and moves it from the widget category to the budgeted amount for the credit card payment. Keeps you from spending that cash on something else and keeps you from getting into debt.

Of course you can change that if you need to, but my debt has decreased significantly since using Ynab.
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Old 13th January 2020, 07:27 PM   #6
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Never made a budget. Never will make a budget.

I don't find it difficult to mentally keep track of what I spend and what I spend it on, nor my income, savings, debts, and assets.

It was particularly easy when I was a near broke student since every dollar counted.

Do people really find it that complicated to need an app?
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Old 13th January 2020, 07:39 PM   #7
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Maybe I DO need a budget. We have plenty of money assets, but somehow the cash flow isn't quite what it should be. Perhaps I'll take a look.
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Old 13th January 2020, 07:51 PM   #8
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I see money as like water. It flows into and out of a series of pools. I don't need to track individual dollars any more than I need to know where a particular drop of water is; what matters is the ebb and flow, the trickles and pourings, the gentle surge and the occasional cataract as the water cycles through the system. Money flows in, money flows out, money rains down gently in interest, money evaporates gently in inflation. I don't keep a budget and I never balance my checkbook but I'm always attuned to the overall system. I know which pools are deepening and which should release stored waters, and in what directions. Place your trust in the waters and they will support your weight. Only survey the waters when in a tranquil mind. All is calm, all is peace, all is patience, all flows effortlessly into itself as the immutable Tao.

Or as my detractors would have it, "the bastard never spends a dollar, he just lets it slosh around making itself into more money!" I'm not actually cheap, I'm just enlightened beyond material possessions to the point where it works out to exactly the same effect. But more smug.
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Old 14th January 2020, 02:06 AM   #9
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Originally Posted by marting View Post
Never made a budget. Never will make a budget.

I don't find it difficult to mentally keep track of what I spend and what I spend it on, nor my income, savings, debts, and assets.

It was particularly easy when I was a near broke student since every dollar counted.

Do people really find it that complicated to need an app?
Yes they do. Different people manage their money in different ways, in the same way that different people manage their weight in different ways.

People with money control "problems" may need a very rigorous and very controlled money "diet" to help them get their spending under control and to change their approach to money management in general. Perhaps later once "good" behaviour has been ingrained then it becomes instinctive and the "diet" is no longer necessary (though like with a diet, for many people old patterns reassert themselves over time).

Your successful money management seems to be instinctive, many (most ?) other people don't have those instincts.
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Old 14th January 2020, 04:08 AM   #10
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Originally Posted by Trebuchet View Post
Maybe I DO need a budget. We have plenty of money assets, but somehow the cash flow isn't quite what it should be. Perhaps I'll take a look.
No budget either. Retirement income can't be touched yet, and there's enough there. My current salary is there to spend on what we want to, with no mortgage and no kids at home. When I finally retire, we may need to watch expenditure, but not right now.
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Old 14th January 2020, 05:49 AM   #11
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Originally Posted by marting View Post
Do people really find it that complicated to need an app?
It seems simple enough on the surface. Put aside money each pay day to meet the demands of your budget and the rest is yours to spend how you like. Needless to say, you don't spend any money put aside except for budgeted items.

The problem is working out how much to budget (a task that can be beyond many people). I'm guessing that the YNOT app does most of the maths for you and you only need to answer a few questions.
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Old 14th January 2020, 06:03 AM   #12
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I never used YNAB specifically, but I did find it helpful to do an exacting budget in previous years. I was planning to move from a low cost-of-living place to a more expensive area and needed to save up a decent cushion of money to help smooth the transition to the higher expense.

If you use mostly credit cards to pay your day to day expenses, it's pretty convenient to track. I just used a spreadsheet i had created that allowed me to categorize daily expenses and also priced in monthly and yearly bills. I had a "hard" savings limit, and also a goal savings limit, and I'd input my expenses every week to see if I was on track for hitting those.

Having a firm understanding of my money actually helped a lot with anxiety in that regard. I never had to wonder how I was doing. I never had to wonder if I was generally spending too much or not saving enough because I knew exactly how I was doing. Deliberate budgeting was much less emotionally stressful than irregular bursts of vague anxiety.

It's a useful exercise to go through every once and a while to fully understand where your money is ending up. I don't keep a monthly budget now, but every once in a while I'll just pick a month and see where it all goes to make sure I'm actually saving and spending responsibly.
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Old 14th January 2020, 08:44 AM   #13
Faydra
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Originally Posted by marting View Post
Never made a budget. Never will make a budget.

I don't find it difficult to mentally keep track of what I spend and what I spend it on, nor my income, savings, debts, and assets.

It was particularly easy when I was a near broke student since every dollar counted.

Do people really find it that complicated to need an app?
First of all, that's super condescending so I pretty much hate you for that.

Secondly though, I'm jealous that you are able to do that. I cannot. When I want the shiny thing I buy it if I have enough in the bank to cover it, forgetting all about all the things that money needs to stay in the bank to cover.

To solve my deficiency, yes, I got an app.
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Old 14th January 2020, 08:59 AM   #14
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Originally Posted by marting View Post
Never made a budget. Never will make a budget.

I don't find it difficult to mentally keep track of what I spend and what I spend it on, nor my income, savings, debts, and assets.

It was particularly easy when I was a near broke student since every dollar counted.

Do people really find it that complicated to need an app?
Some do, yes. My sister, for example, sees a paycheck as a challenge. It's got to be all spent before the next one shows up.

I don't budget myself, my income, thankfully, outstrips my desires, most of the time. But I do use Mint to track my spending / bill reminder system.

There are a number of people out there who are exceptionally bad with money. Or planning. Or both.
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Old 14th January 2020, 04:05 PM   #15
marting
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Originally Posted by Faydra View Post
First of all, that's super condescending so I pretty much hate you for that.

Secondly though, I'm jealous that you are able to do that. I cannot. When I want the shiny thing I buy it if I have enough in the bank to cover it, forgetting all about all the things that money needs to stay in the bank to cover.

To solve my deficiency, yes, I got an app.
Cool.

Since that works for you, that's super. It would probably frustrate me and I'd stop using it in about 30 minutes. I just don't like doing any avoidable work.

I remember back when I'd buy lots of black eyed peas because they were really cheap and I didn't have much money. Of course back then I would have had to keep a detailed expense journal rather than an app that would make it easier to get a good overview. So I just kept mental track just like one keeps track of phone numbers, friends names, etc. But I also had a good number sense and found estimating things easy and intuitive. But I'd still write down stuff that needed to be highly accurate like balancing a checkbook when the bank checking balance was too low to estimate sufficiently well.

OTOH, my wife has never had a good sense of her income/expenses/assets/liabilities. Even though she's meticulous about tracking her checks and credit card expenses. Fortunately for the both of us she's not much of a spender so she gradually built up quite a large amount of savings. Yet she worries about spending even a small portion of it. Still, she has a hard time passing up a deal on handbags.

We have both been retired for 10 years and are enjoying the fruits of our different, but effective approaches to life. We are probably outliers.
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Old 19th January 2020, 12:31 PM   #16
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Originally Posted by Leftus View Post
Some do, yes. My sister, for example, sees a paycheck as a challenge. It's got to be all spent before the next one shows up.



I don't budget myself, my income, thankfully, outstrips my desires, most of the time. But I do use Mint to track my spending / bill reminder system.



There are a number of people out there who are exceptionally bad with money. Or planning. Or both.


I think Faydra is being exceptionally good at self-awareness, and at planning.

She has identified a problem and found an appropriate tool for the solution.

Furthermore, Faydra is building on her insight by trying to maximise her knowledge of the tool and is calling for ways people manage without a tool.
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Old Yesterday, 07:46 AM   #17
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Originally Posted by Orphia Nay View Post
I think Faydra is being exceptionally good at self-awareness, and at planning.

She has identified a problem and found an appropriate tool for the solution.

Furthermore, Faydra is building on her insight by trying to maximise her knowledge of the tool and is calling for ways people manage without a tool.
No doubt. Was not a knock on Faydra in the least. Apologies if it came off otherwise. Of course, I was not responding to her, it was a response to the statement that someone could not comprehend why someone would need such a tool. There are people who are just horrible at money management. I could give hundreds of examples if pressed. My favorite is I was working with one fellow, and until he had to provide his expenses never realized what he was spending on a monthly basis.

My sister, mentioned above, could certainly use one. Doubt she would stick to it. She just doesn't see it as a problem. Now she wants / needs a place of her own, and reality is going to hit hard. As it does.
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Old Yesterday, 11:01 AM   #18
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Originally Posted by Orphia Nay View Post
I think Faydra is being exceptionally good at self-awareness, and at planning.

She has identified a problem and found an appropriate tool for the solution.

Furthermore, Faydra is building on her insight by trying to maximise her knowledge of the tool and is calling for ways people manage without a tool.
I agree. I wish such tools were easier to use when we were starting out.

Two jobs and no kids and yet we had such a hard time making ends meet. It really took a lot of time and focus to track down every little expense and find out where we were bleeding. Stupid big things like car insurance that we hadn't price checked were the bulk of it. But stupid small things, like a soda grabbed while filling the car up with gas were also a problem.

Once we got all that under control we were able to coast pretty well. We have retirement accounts and investments that are just off the table mentally, and we have always kept a large liquid savings account that has acted as our buffer and warning system. We take money in and out of that as needed. It helps to smooth out our cash flow issues since I have times where clients are late to pay or I may have a flush month or a lean month here or there. I was paid about 25% of my earnings last year in the month of December, for example. But, we keep an eye on the savings balance over time and if it is decreasing over time rather than increasing then we have a problem and we go into budget detective mode.

The only things we've found consistently in budget detective mode lately are that college is expensive (even if mostly funded by a 529 account) and trips are always more expensive than you planned, even if you plan on them being more expensive than you want.

But man, those early days of entering data by hand into spreadsheets sucked so bad. I remember staying up all night one weekend trying to get my bank to download useable data over a dial up internet access. That didn't work at all.
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Old Yesterday, 08:24 PM   #19
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Sometime back in the Middle Ages, I was transferred by my company to San Francisco. Fortunately back in those horse and buggy days, rentals in Baghdad by the Bay were only an arm and a leg per month instead of an arm and most of your torso, but I still felt the pinch. My mom suggested that I carry around a small pocket notebook with me everywhere and record all my expenditures, and at the end of the month I would know where my money went.

It didn't even take a week before I realized that food was the biggest unexpected expense. If I spent $10 a day (very easy even back then), I'd be putting almost half my rent expense down my gullet. So I started brown-bagging it to work, and suddenly I wasn't so tight all the time.

In more recent years I often worked on commission, and the projects I worked on often took 6 months or more to come to fruition, so I've always been careful.
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