Yearly Archives: 2009

The End-All, Be-All Savings Tip

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This is the end-all, be-all savings tip really. Because what it represents is an eternal spring of information to help you save money on virtually every aspect of your life.

Most everyone reading this blog is likely already on Facebook (add me as a friend here). Two years ago half of you hadn’t even heard of it, and the other half had perhaps signed up, but didn’t know why it was important.

Twitter is an even more recent phenomenon. Many of you reading this won’t (yet) have a Twitter account (follow me on Twitter here). It’s still new. And half of you that don’t have a Twitter account will rebut this with, “I don’t need to know what my buddy Steve is eating for breakfast.”

But it’s just because you’re probably using it all wrong :)

The other day I had a hankering to watch what was, at that time, one of the greatest documentaries of all time, Pumping Iron. A simple Facebook status update did the trick:

From one status update I had several options ranging from a bootlegged copy (I sell software for a living so…I’m not into stealing IP at all) to a Netflix trial (free) to borrowing it from a friend of mine (free).

I saved time and money.

People jump on social networks and think it should somehow be different than how things are when you’re out at a restaurant with friends, or surrounding a card table with buddies. It’s not. Or I guess I should say that it doesn’t have to be.

A “real life” example. My wife is a pro with health insurance. She’s not an agent or anything like that, but she’s learned a lot through experience and she will dispense her (money-saving) advice if you ask. She loves helping people save money in that arena. Really. She gets jazzed about it. We had friends over for dinner a few years ago where my wife pretty much single-handedly saved them $2,000. It had to do with them wanting to have a baby in the next year, supplemental insurance, some timeframe…anyway. They actually made money when their baby was born. (I guess I should state that this was totally legal, because I just re-read this paragraph and it sounds too good to be true.)

This was free advice for the taking.

Yahoo! Answers is pretty popular because it’s all about crowdsourcing the answer to a question. Wikipedia…crowdsourcing an encyclopedia.

I don’t mind getting answers from strangers, but I would much prefer getting answers from friends and colleagues because 1) I already have a relationship of trust with them and 2) it builds our relationship even more.

Now don’t just be a leach. Offer your help as well. Karma and all that.

We have a guy building us a sweet piece of furniture. How’d we find him? My cousin.

My Dad needed to sell his truck a while back. Who needed a truck? Strangely enough, another cousin of mine.

I needed to see Pumping Iron. Problem solved. (By the way, what was a breakthrough documentary at the time is now very dull. Our documentary-making skills have improved in the past 30+ years).

We needed some Flex developers for YNAB 3. Taylor (YNAB’s Lead Programmer Guru, follow Taylor on Twitter here) found them through a meetup.

You need a reliable car repair shop.

You’re looking for an old desk to transform into a workbench for your garage (“Does anyone have an old desk they want to get rid of?” You may ask.)

You see the writing on the wall and want to begin looking for other work.

You have no idea when to plant tomatoes in your area.

You’re looking for a new veterinarian.

I could go on and on. These networks you build virtually can be extremely useful in reality, saving you tons of time and money if you use them in this way. Remember to give back as well. That’s exactly what you’d do around the dinner table.

P.S. Let’s connect on Facebook and Twitter!

We're Giving Away Five Copies of YNAB 3

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This contest is over. Thanks for all the entries!

The launch of YNAB 3 is now in Open Beta, so we’ve found our winners here, here, here, here, and here.

(I admit, that was cruel how I announced that, but with the beta launch in full swing, I’ve left my inbox now for about 15 minutes and am extremely far behind now. Time is a hot commodity around here!)

Winners, please contact me with the same email address you used when posting and we’ll get you all set up!

Five lucky people will win a copy of YNAB 3

How You Enter the Contest
Simply leave a comment below singing praises to YNAB ;)

How You Increase Your Chances of Winning
Leaving a comment below will earn you one entry into our random drawing. Doing any of the following things to help us spread the word will give you even more entries:

Where What Bonus Entries
Mention YNAB 3 on Facebook (+1), and while you’re on Facebook, become a fan of YNAB (if you’re already a fan, no need to do anything here). +1
Tweet about YNAB 3 +1
Write a blog post about YNAB 3, linking to the YNAB 3 page. +3
Make a 30-second YouTube video describing why you like YNAB and/or why you’re excited about YNAB 3. (Tag it with “ynab 3″ so we can find it!) +7

Entry Deadline: the day before we launch into public beta (hint: don’t procrastinate entering the contest. We haven’t announced it yet, but we’re getting oh so close!)

What You’ll Win: On the launch date of our public beta, you’ll be sent a download link to YNAB 3, and also be given a YNAB 3 license key. The license key will unlock all of YNAB 3′s goodness for you to use to your heart’s content.

Rules: For bonus entries to count, your comment needs to link to your tweet, status update, youtube video, blog post, etc. Of course there’s no purchase necessary :)

How You’ll Be Notified: We’ll announce it here on the blog, and send an email to the YNAB 3 list with the winners announced. If you aren’t yet on the YNAB 3 list (which will also give you an early-bird discount), you should sign up below.:
Got it! Please check your inbox for a confirmation email.

If the Hat Makes the Man, the Icons Make the Application

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Taylor and I have been working closely with an absolutely phenomenal design shop, Artua, to develop some phenomenal icons for YNAB 3 (which will be phenomenal).

Artua exceeded our expectations at every turn. They were responsive to (what little) feedback we had, and delivered stunning icons with a turnaround you’d expect with your breakfast order at Wafflehouse — not with such high-caliber design!

The Accounts, Budget, and Reports icons:

accountsicon

budgeticon

reportsicon

How do these phenomenally (4th time in this post I’ve used that word) stunning icons look in the app? Phenom–Fantastic:

newiconsinapp

To outline all of the reasoning behind the gorgeous details in these icons would be like my 10th grade English teacher breaking Hamlet down formulaically. You just shouldn’t do that with art.

Hat tip (no pun intended) to Max Ernst (1891-1976) for the inspiration on this post title.

YNAB 3 Sneak Peek – Reports and Search (It's Hot)

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Alright, we’ve done a lot since I last showed a sneak peek of YNAB 3. Here are a few more:

Reports (spending, net worth)

Register (search, optional columns)

When will we release?
All I can say is that we’re tracking well for a 2009 release. Private beta will begin shortly, and after a bit in there, we’ll move to Public beta where you can purchase YNAB 3 at a discount and start using the software. By the time we move to public beta, the software will be in excellent shape, so no worries there!

For more info on YNAB 3, please check out the YNAB 3 page!

A Happy YNAB User

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Ed sent this to me a few days ago:

In the 80′s some years before financial programs hit the consumer market I have had the yearn to use a system to manage finances. I started with spreadsheets 1st paper then computer. When Quicken came out I became an avid user. After several years I began to realize that Quicken was really only good at telling me what happened and not good at budgeting and managing. I began a thorough search and tried no less that 10 other programs.

It was not till I found YNAB that I really thought that it did everything I wanted. It still has some growth possibilities especially in the reporting area, but it is actually exactly what I needed to take control of my money and has made me capable of preparing for emergencies before they happen. It has also allowed me to help others that are not as financially prepared. Thanks for your software. I am looking forward to 3.0.

The Secret to Improving Your Finances, Bench Press, and Golf Game — Among Other Things

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The Golf Game

Three years ago I left the world of Public Accounting and struck out on my own. As a part of that, a friend introduced me to golf.

The magic with golf is in the fact that you only need to do it well about five percent of the time, but that five percent is so satisfying that you endure the other 95 percent of the game. Especially when you’re just starting out.

Beginning in the Summer of 2007, after several days of buckets at the driving range, I took to the course for my first nine holes. I don’t remember what I shot — I think it was a 65. The score didn’t matter to me though — I was hooked! I went home and began building a spreadsheet where I could track my scores every time I played. A few days later I figured there must have been a better way, so I Googled a bit and found StatDoctor. Since that day, I’ve logged every single round.

For the first twenty rounds or so I just tracked the score, but I quickly saw there was value to be had in gathering a bit more data. So for the past three years I’ve been tracking my score, bunker plays, fairways hit, greens in regulation, and number of putts per hole. Just recently I started tracking the distance of my drives.

Going to the range and pounding out buckets of balls works. It gets you to a point where you’re making some pretty good shots. But knowing exactly what I need to work on, where the weak spots are, what strengths my game has…that makes my practice and work extremely effective because I am more aware of what I should be working on. Just hitting buckets for the sake of hitting them…there’s a better way.

A month ago I had a consistent shot at 110 yards with my 54′ club, and 85 yards with my 60′ wedge. I saw that I needed to dial in some more distances because my greens in regulation were really low when compared to my fairways hit. I went to the range, scoped out distances at 75, 60, and 45 yards and went to work. I hit an entire bucket toward a puddle that was 45 yards away. Now when I find I’m at that distance, I know exactly what to do.

Here are my number of greens hit in regulation for 2009.

# of Greens in Regulation

Since I began tracking in StatDoctor, my +/- par (for me, so far, they’re all par+):
+/- Par

Tracking my golf scores so meticulously (and consistently) has given me more desire to practice, more insight into what I should practice, and much better results than I could have otherwise expected.

The Bench Press

Three days ago, on October 12, 2009 I was issued a challenge:

The Bench Press Challenge email

In January, perform as many bench press reps at 210 lbs as possible, spread across three sets.

There’s a good way, and a losing way to go about doing this. At the risk of tipping my hand to my challenger by way of this blog post, I’m not going to reveal everything I’ll be doing to make sure I’m ready to dominate come January, but here’s the gist:

1) If I’m going to win this challenge I’m going to need to increase my strength. For my starting point (first data point), I found my 1 rep maximum (RM) this morning. I’m not going to divulge what it is, for competitive reasons! My 1RM is going to be tracked meticulously until the duel is done.

2) Once a foundation of greater strength is…forged…I’ll need to make sure my muscles can perform optimally for endurance, since this is also a muscular endurance test. I’ll make attempts every other week and log my performance in my workout journal (along with what I ate beforehand, how much sleep I had, and my overall feeling prior to the lifting).

3) The fact of the matter is that I’m going to need to gain some weight because the strength’s not going to come nearly as much from my current build. On New Year’s Eve of 2008 I wrote:

Physical – No soda this year. H2O, here I come! Also, I want to get my BFP to 9%. In years past I’ve also prescripted some workout for the year and about 90 days into the new year I’m already tired of the workout and want to do something else. So I’m shooting for a results-oriented goal here of a change in bodyfat, rather than a task-oriented goal. Let the task change as necessary/desired, I know the result I want to get.

I’ve managed not to drink any soda this year, and my BFP is down to 11% (from 15% at the beginning of 2009), but yeah, that’s over. Because of the duel, that resolution re: the bodyfat is going out the window.

So how will I gain weight strategically (and with clean food)? I’m employing Lose It. It’s the greatest iPhone application in existence:

photo 2

I’ll track every calorie in, calories burned, and my bench press (strenght/endurance) results.

The working out will be simple because that’s done an hour a day and then I don’t have to think about it anymore. This thing with the food is going to be tricky and will likely prove to be the more difficult part of the task. That is why it’s so critical that I track religiously so I can stay motivated to eat clean, frequently, and a lot.

Your Finances

If you want to improve anything about your finances then you need to pick some meaningful data points and begin tracking. Make some goals and then record data consistently until you reach your goals. You’ll find that tracking your results provides you with useful information for better decision-making and keeps you motivated to stay your course. Keep things simple and actionable.

Controlling Your Financial Destiny: Seeing Things as They Really Are

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The MatrixYou live in a world that isn’t real. You’ve been basing your financial decisions on everything you’ve seen around you, and you’ve allowed yourself to believe that what you’re seeing is true. What you’re seeing is very rarely true.

This may sound harsh, or insensitive, but the guy that just rolled up two doors down with the brand new lawnmower is going to be paying for that thing (twice over) for five years.

The lady whose house is decorated immaculately is late on her credit card bill.

The parents whose kids have all the latest toys are up to their eyebrows in debt.

The young, successful salesman across the street refinanced his home three months ago to free up $400 in monthly cash flow. He has no idea where that $400/month has gone.

The doctor is working himself into oblivion, but can’t make headway on his student loans.

The husband that bought his wife the new car she’s been wanting is now sleeping less. He doesn’t know it, but his wife secretly wishes he hadn’t bought it.

The happily married couple simply avoids the topic of money.

You don’t see any of that, but it’s all there. And, unfortunately, you’ve lived most of your life making decisions based on assumptions that are entirely false. The people you see around you, and who you aspire to be are all broke. They’re all stressed.

There’s a scene in The Matrix (the original, good movie, not the sequels) where Neo is just finding out a bit about the Matrix. He knows enough to know that something with the world he’s always known isn’t right. Morpheus gives a great line:

Like everyone else, you were born into bondage.

Morpheus is talking about the fact that all Neo has ever known is the Matrix. A façade. A fake life. There’s nothing real about it. In a lot of ways, until we kick some seriously bad financial habits and starting doing things that are liberating (I won’t say, *AHEM* exactly what those things are), we’re stuck. Zero progress is bondage — period.

To end the scene, Morpheus gives Neo a choice of two pills. If Neo takes the blue pill, he’ll wake up and not remember anything about their encounter. He’s allowed to push a big Reset button.

If Neo takes the red pill, he gets to see “how far the rabbit hole goes.” He’ll get to see the reality for what it really is.

Since Neo is the hero, and since he chose the red pill, what type of parallel do you think I’m going to make? The red pill — the REALITY pill, is your budget. Nothing about what you see around you is true. The only thing true is what you care about, what you bring in, and what you let flow out of your life. Your values are real. Your perception of the financial situation of others around you is not real.

Once you’ve taken the red pill, your financial potential is greatly enhanced. Please take a few seconds to view this clip from a classic:

Once Neo saw reality, he was able to control his own destiny. Could the similarities be any clearer here? Once you get a strong dose of your own reality (through effective budgeting), you’ll also be much more empowered to control your own financial destiny.

What’s the financial equivalent of stopping a speeding bullet in mid-flight? I have no idea. But my guess is that you can do it.

Oh, and in your financial world, you are The One.

YNAB and Your Kids' Perception of Money (a YNAB Success Story)

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Karen wrote in a bit ago with the following fantastic story:

My family has been using YNAB for the last 3 months and the changes we’ve seen are phenomenal! I thought it would just help us to get on track and save some money. I never thought it would be such a wonderful tool for teaching our children the true value of stewardship. Our family budget is known and understood by all 6 family members- mom, dad, and four girls ranging in age from 16 to 8. We go over everything with the children so they understand how much there is to start with and where it all goes. I wanted to share with you some of the fruits of that…

1. The kids wanted to donate to the [removed] fund and chose to take 20% from our “fun money” in the budget. (a movie ticket)

2. All four girls gave up their allowances for one week to give to the [remove] research fund. (not a lot of money but a lot of sacrifice)

3. Each of my girls has a budget of 50.00 for new clothing this fall. We live in an area where most of the kids are wearing sweatshirts from the mall that cost that much! My girls scoured for the best deals and focused on needs as opposed to wants. My 8 year old made it to the checkout and was 12.00 over budget and promptly stopped the clerk and asked if she could remove some items. She then turned to me with a great big smile and said, “I did it mom! $48.48! I’m under budget!” The clerk was hugely impressed.

As am I!

Just imagine how this education will pay off for the kids down the road.

When All Else Fails, Go Back to the Basics (Pulling Irons Left)

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My golf game will be doing just fine and I’ll be plodding along, slowly chipping away at a stroke here or there. This year has been the year of my fixed drive, which I’ve been enjoying quite a bit. Where I used to have a low, line-drive hook, I know have a high slice. Head down, swing through, and the slice goes away.

The strange thing is that as I seem to be doing well, I get a bit overanxious and my swing speed, particularly with my irons, starts to pick up. I lose a bit of my rhythm and end up pulling the ball. It’s as if my hands just pick up speed and I come around to quickly. Whether it’s my hands accelerating, or my hips slowing down…they get out of sync.

Just when things are really starting to roll for me, like when I was two over after eight holes…all I needed to do was par the last hole and I would beat my personal best by a stroke. I doubled it. I pulled my nine-iron on the approach shot and then had an indifferent chip shot, forcing me to two-putt.

When the pull starts creeping back in, I always go back to the basics:

How’s my grip?
Are my hips active on the backswing?
How’s my rhythm? (The solution to any rhythm problem I have is to always slow down).

If I can revisit each of those and do some checks, the pull goes away and I get my nice, normal (very playable) draw.

And so it is with money. It pays to revisit the basics when things start to go a bit off course. Are you finding that your EGG (a term Erin, YNAB’s online coach uses for Entertainment, Gas, and Groceries) has increased undesirably? Are you slacking on your Rainy Day funding of known but inestimable/unforeseeable expenses such as car repairs and medical expenses?

Has your debt-paydown intensity lessened?

Go back to the basics. Revisit your budget. Make sure you’re tracking every dollar. Ensure you’re living on last month’s income (only!). Fund your Rainy Day categories dutifully. Roll with the punches only when absolutely necessary.

This isn’t a tactical savings tip, but I think every once in a while we all need to be reminded that course corrections are a part of the journey — not failures, just fixes.