David and I have been mostly debt free since 2001. Oh, we’ve had a minor set-back here and there, but for the most part, we’ve been able to use our credit wisely and have only occasionally carried a balance. That seems pretty good, right? I thought so, except having enough money was still a little bit of an issue, especially when big expenses like seasonal clothing purchases, or homeschooling materials, or Christmas came up. And, I’ve noticed this year, we’re very much in the habit of buying what we want rather than what we need, and those wants frequently end up tossed or given away, because they were just impulse purchases to begin with and didn’t have any particular purpose for us. (Davey actually likes to stuff his stuff in a drawer!)
I’ve been using YNAB – You Need a Budget – since last January, and while I liked it, the purpose and usefulness of a budget really only just clicked for me in October. It turns out that the bank account balance is completely irrelevant; it’s the category balances that matter. Who knew? (Maybe you, but it’s been quite a revelation for me!) Working off category balances, our money has been spent appropriately for the past couple of months, and even with all the Christmas shopping I hadn’t saved much for, our account balances are on the rise.
And it’s fun! Crazy, right? Maybe your idea of fun is different than mine, but I kind of like “crunching” numbers, so paying attention to our spending, allocating resources, and tweaking the plan is one of my fun jobs. And I do it every day, now that I’ve figured it out. YNAB has a mobile app that syncs with your home PC via Dropbox, so you can update your purchases on the go. Every time you enter a transaction, your remaining category balance pops up, which is extremely helpful.
YNAB offers a 34 day free trial. Try it and see if you like it, but don’t jump ship too soon! I liked it enough in my first month to purchase it, but I’ve been tweaking it all year to make it work for me, especially in dealing with my accounts receivable and cash transactions. And, like I said, I really only just figured out how to work a budget properly anyway. I’m sure you’ll pick up on it much faster.
If you click through any of these links, you’ll get $6 off the purchase price, and I’ll get a $6 referral bonus, which I would like very much. Also, poke around their site. They offer free budgeting classes, a great blog, and a weekly newsletter I love, because I’ve found some other inspiring money-management blogs through it.
I have a few other things I want to share, but it’ll keep for a day or two. Let me know what you think, okay?