YNAB’s two teachers met today to develop YNAB’s upcoming Weekly Meet Up Classes which are beginning in March.

Todd Curtis and Erin Lowell

Each Weekly Meet up will begin with a short presentation on a Topic of the Week and the topics will be generated by participants. This will be followed by Open Q&A on whatever you want to discuss about YNAB!

Weekly Meet Ups will be free, of course. You can attend once, or every week.
Here are the dates and times for March:

March 14th – 8:00pm EST

March 22nd – 9:00pm EST

March 27th – 7:30pm EST

We’d like your feedback on topics! Please take a second and fill out this short 2 question survey.

Then there are credit cards.  Most folks have a few of those as well.  Many people have a credit card they use for purchases and pay in full each month and some folks have cards they have stopped using entirely and are just trying to pay off.

It’s not unusual for me to look at a YNAB file and see ten accounts.  In an effort to understand the people I am working with, I always ask the purpose of each account.  When it gets right down to it, many times people are using accounts to budget.  “The money in this account is for XYZ.”

Why are we so hyper focused on accounts?  Because if you do not have a budget – you do need some structure to manage your money, and accounts are the structure that society provides.  (See?  You are secretly craving a budget!!) Everyone has a few accounts, and we are in constant contact with them. Money goes in and out all the time.  If you are using an account for a specific purpose – more than likely – you are trying to budget through accounts.

It can be really hard to let go of that structure, but the budget can simplify things for you if you let it.

Let’s say you have two checking accounts as mentioned above – one for bills and one for everything else.  If you create categories for the bills – and everything else – you could easily have one checking account.  Track WHAT the money is for in the budget.

In fact to take this a step further, when you finally go to spend money, checking the account balance is no longer even necessary.  Check your budget instead!  Let’s say you have budgeted $300 for groceries and your total account balances are $1000.   It doesn’t really matter what account you use for the purchase. You can hand over cash, a credit card, a check, a debit card – the budget doesn’t care HOW you pay for this.  The budget needs to know that it was for groceries.  The point is that $300 is what you have set aside for groceries.  Your other dollars ($700 of them) are busy doing other jobs!  So you cannot spend all $1000; your allowed amount for groceries is $300 and it’s the budget, not the bank balance, that tells you so. 

Do you have multiple savings accounts? Condense that down to one!  Set up savings categories on the budget to track your savings goals.  Instead of having a savings account for emergencies, and a seperate one for vacation, and yet another one for property taxes, set up a master category for savings, and  sub-categories for each of those things.  This is what the budget is for!

Honestly, if I could find a checking account that paid a great interest rate, I’d have one account and let my budget take care of everything else.  Because ultimately, accounts are just storage containers for our money.  (Dollars by location)  The budget is where we keep track of WHAT our money is doing.  (Dollars by job)  When it comes right down to it, the budget doesn’t care WHERE your money is.   You can keep it all in pennies in a sock drawer if you want – as long as you tell the budget what you spent those pennies on.

Can you imagine how simple things would be with one account?  Think about it.  No transfers, no wondering how to move things around.  Look over your existing accounts and ask yourself “Am I using this account to budget my money?  Could I take care of this by creating a category instead?”

Simplify your life.   Trust your budget.  Close some accounts! 

It’s been a somewhat challenging couple of days for YNAB Webinars, so I thought I’d post an update so people know what happened.

I had two classes scheduled Wednesday evening. About 15 minutes before the start time, severe thunderstorms rolled through my area of Maine. I was able to warn those who’d signed in before class started that the weather was bad and I might lose power, but that was only about a dozen people. At 7:30PM EDT, promptly at the start of class, my power went out. It was out for 10 hours. It was frustrating to know people were waiting for me not knowing why I wasn’t there.

The weather was beautiful Thursday so I thought things would be fine. But about half way through my first class last night, my internet went down. It turned out to be a service disruption to the entire area.

Everyone involved should have been notified by now, but in case you weren’t, please accept my apology. I don’t want anyone to think that’s how we do business around here. If I’m not at a webinar, it’s because it’s completely out of my control. But I still feel awful that people were waiting and probably confused as to what happened.

The Wednesday night classes were rescheduled for Monday and registration is posted on the coaching page. I’ll reschedule the other ones when I do the August schedule in a few days.

Please register again if you were registered before, and feel free to join us even if you weren’t signed up. This was a very unusual occurrence and hopefully things will go just fine from this point forward.

Thanks for your understanding.

~Erin
YNAB Coach

Each time I get the question, I’m reminded of an article I read years ago written by Amy Dacyczyn, who authored a very popular book on frugality called The Tightwad Gazette. Her article was about converting your spouse to a more frugal lifestyle, but I’ve always thought the advice might apply to budgeting.

So I finally dug out the book – which I highly recommend by the way – and thought I’d share her main points with you, and elaborate a bit on how they might apply to converting your spouse to budgeting.

I hope that you find something useful to help you move forward with your spouse.

1. Establish some financial goals you can both agree on.

This seems to me like a good place to start. You may not agree on everything, but perhaps your family is saving a down payment for a house, or trying to pay off some credit card debt. You might try asking your reluctant spouse what their financial goals are, and try finding common ground from there.

2. Gather evidence.

YNAB makes this suggestion very easy to implement. As time goes on, you’ll have a lot of financial data to look back at. It’s be easier to address spending leaks if you can point to the actual transactions that created them.

3. Discuss Budgeting at a “good time”.

Discussing things when everyone is in a good mood will lead to much more productive conversations. It’s probably not best to approach your spouse when you are very angry and he or she is feeling defensive. Start the conversation from a positive place.

4. Stick with the facts, avoid blame.

When discussing a specific concern, just state the facts.

“We agreed we’d make a $100 payment on the credit card bill. You bought a $50 video game. We only made an interest payment on the debt.”

That way, it’s about the facts, and not about who’s right and who’s wrong. It’s more difficult to dispute the facts.

5. Be the leader.

If your spouse won’t stick to the budget, you should still try. Lead by example. Your efforts alone may not solve everything, but some budgeting is better than no budgeting.

6. Request small changes rather than sweeping reform.

If you want to lower the “Eating Out” category by $200, start by agreeing to lower it by $50, and work from there. Or perhaps you might ask your spouse to wait one month to purchase something they really want. You aren’t saying no, you’re just saying not quite yet.

7. Give your spouse some freedom.

I’ve seen many YNABers do this successfully. Simply set up a category for each of you, and agree on an amount you can afford within your budget.

For example:

Fun Money – HIS – $50
Fun Money – HERS – $50

Each person can spend their amount without having to answer to the other person at all. Since it’s an amount you’ve agreed on and budgeted for, you can spend without worry.

8. Be patient.

Change takes time. I personally found it easier to stay committed to YNAB after six months had gone by and I could really see some positive change. It may take a while to turn things around financially, but if you are leading by example, some things are likely to get better. At that point hopefully your spouse will begin to see the benefits of budgeting and buy in a little more.

9. Give positive reinforcement when possible.

This is good advice in all situations. If your spouse does manage to stay under budget in a category, or bring you receipts so you can enter them, that’s a step in the right direction. Celebrate that!

I recognize that these tips may not solve all your issues in converting your spouse, but I thought there might be something in there that’s useful to some of you. If you have some tips of your own that worked with your spouse, feel free to share them by commenting on this post.

~Erin
YNAB Coach

Most importantly however, it adds a number of new features that I think you’ll really enjoy:

• An unlock code to prevent anyone from accessing the app on your phone unless they know your code. (It’s optional if you don’t want it)
• Streamlined syncing: The sync passcode stays the same between runs, and the next version of YNAB for desktop remembers your passcode between runs as well. This means that 95% of the time, nothing has to change, and you can just hit “Sync now”. The app also lays some groundwork to make it discoverable by a new version of YNAB so you don’t have to type the IP address. I have the prototype for that code running on my machine, but it will be a while before it’s released since it relies on AIR 2.0, and we still need to figure out our AIR 2 upgrade story.
• Transfers – you can now create transfers on the iPhone
• Flags – You can flag transactions as you enter them now

Enjoy!

If you are using the YNAB iPhone app, please do not update your iPhone’s OS to the new OS: iOS 4. (It is available to early adopters now, and will be released officially by Apple on Monday, June 21, 2010.) This OS update breaks the YNAB iPhone app. We submitted a fixed version of the iPhone app to Apple earlier this week, but it won’t be available until Apple approves it, and that could take them a few more minutes or a few more days. (They are notoriously difficult to predict with things like this).

If you do update to iOS 4 before the app update is approved, all of your categories and transactions will be out of order. This means that some categories will be listed under the wrong master categories, making the data appear broken. (This happened because iOS 4 changes the way the phone returns sorted data to our app.)

We will post updates here, in the forums, on Taylor’s Twitter, and on Jesse’s Twitter. Hopefully soon I’ll be able to give you the good news that Apple has approved our app update! In the meantime, please resist updating your iPhone’s OS!

Improving your cash flow can make a big difference in the quality of your financial decisions.

I discovered YNAB four years ago in the summer of 2006. While I paid all my bills on time, I was not controlling spending and ran up some credit card debt. One of the last purchases I made before discovering YNAB was a brand new riding lawn mower. I mow two acres of my four acre property. My older riding mower finally broke down, was not worth the repairs needed, and had to be replaced. I simply had to have a good riding mower.

At that time, I had no savings, no rainy day funds, and no emergency fund. My options were fairly limited. I could only see one – credit. Armed with nothing but a credit card, I marched myself over to the nearest store and bought a shiny, brand new riding lawnmower for about $1200.

I did not realize it at the time, but I could not afford this mower.

Enter YNAB.

I spent the next year getting a much needed wake up call. I shifted my priorities, stopped the bleeding and learned to live on less than I earned. Since that time, I have paid off all my debt, built up an emergency fund and saved toward a number of rainy day categories. But it wasn’t until recently that I realized the true power of having cash on hand.

Remember that new lawn mower I bought four years ago? That turned out to be a real lemon. It died tragically in the back field last September. Despite good maintenance and care, the engine seized. Way past warranty, I had to buy another mower.

But thanks to YNAB, things were different this time for two significant reasons.

1. I knew exactly what I could afford.

While I wasn’t planning on purchasing a mower, I was able to review my entire financial situation, decide how much I could afford and move some funds around. I knew this time that I could set an amount I could truly afford and then spend with no worries.

2. Having cash on hand afforded me better options.

The truth is, despite the fact that things are MUCH better financially, my priorities are different. I didn’t want to spend $1200 on a new mower. But that’s okay. With the help of my trusted mechanic, I spent a few weeks researching second hand mowers and just purchased a nice second hand mower that will do the job quite well! Because I had cash, I could not only shop on the second hand market, (NOTE: private sellers and yard sales typically don’t take credit cards), but I could negotiate! I was able to get my mower for less than the asking price, and for less than half of what I paid for four years ago.

Budgeting improved my cash flow situation considerably. Better cash flow improved my spending decisions. Better spending decisions improved my budget.

All of this has improved my peace of mind.

It’s a beautiful day here in the state of Maine. I think I’ll go mow the lawn.

Happy Budgeting!

Erin – YNAB Coach

THE SCENE: Three friends are enjoying a cup of coffee discussing the benefits of budgeting in their lives. One friend is less convinced of the benefits than the others…

Joe: What has the Budget ever done for me?!?

Tom: Well, it’s given me control over my spending.

Joe: Oh yeah, yeah it has given us that. Yeah. That’s true.

Steve: And I make better spending decisions now.

Tom: Oh yes… better spending decisions. My wife and I used to spend like crazy.

Joe: All right, I’ll grant you control over spending, and better spending decisions are two things that the Budget has done.

Tom: And awareness of where our money is going…

Joe: (sharply) Well yes obviously awareness… awareness goes without saying. But apart from the control over spending, better spending decisions and awareness of where my money is going…

Tom: My debt has decreased.

Joe:Yes… all right, fair enough…

Tom: And I have money in savings…

Steve: Oh yes! True! I would really miss that if I weren’t budgeting.

Tom: All my money has a job.

Steve: And I’m not living paycheck to paycheck anymore. I have a Buffer and I’m living off last month’s income.

Tom: Yes, that certainly has made things easier to manage.

Steve: Well that, and that I saved for a number of rainy day categories.

Tom: and you know, I’m not as stressed since I have a way of dealing with overspending.

Steve: Good point, I know what you mean.

Joe: All right… all right… but apart from control over my spending, better spending decisions, increased awareness of where my money is going, decreased debt, increased savings, the fact that all my money has a job, getting out of the paycheck to paycheck cycle, saving for rainy days, a better way of dealing with overspending, what has the budget ever done for me?

Tom and Steve: It’s brought financial peace of mind!

Joe:(very angry, this is not going well for him at all) What!? Oh… (scornfully) Financial Peace. Never mind!!!

Are you wondering what the budget has done or could do for you? Have you checked out our free online classes? We’ve just restructured things in April. All our webinars are now one hour in length, and we now have four different Beginner Classes and three different Advanced classes. You can read about the classes and sign up here. Join us and learn what the budget can do for you!

Erin – YNAB Coach

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.

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

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:

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.