Budgeting can make dreams come true — really.

I’ve been wanting the ultimate driving machine for quite a while now. I think since I was seventeen or so. My wife finally caved and I was able to buy one!

My wife’s main concern was the fact that it’s pretty flashy (I chose silver). She said she didn’t want it to go to my head, was concerned about what others would think, etc.

None of this would have been possible except for the fact that we’ve been disciplined and calculated with our finances. This budgeting thing really works.

Take a look at my dream come true!

I’ve thought about sending her a t-shirt.

Or maybe sending a courier with a copy of the software.

What would you say to Jen to convince her?

Check out her blog post and leave a comment :)

Oh my.

YNAB Pro on Amazon has received many, many favorable reviews (thanks to everyone that’s written one!). However, apparently, too many positive reviews are a bad thing. From one reviewer:

Don’t be mislead by the lengthy positive reviews for this product, they appear to be fake.

Ouch!

One commenter further solidified this rock-solid assumption:

Awefully suspicious how there are so many five star reviews on this product. I don’t think I’ve ever seen another product on Amazon (esp software) rated so high. Thanks for this post; this makes me nervous and I am steering clear of this product.

Alas. I suppose too many positives do make a negative… if you’d like to leave a review, be my guest. But please make it real ;)

One sure-fire way to spend less is to count your blessings.

Note: Your Mac will need to be Intel-based for this to work!

1. Go to http://virtualbox.org/wiki/Downloads and download the “VirtualBox 2.0.2 for OS X hosts” version for Intel Macs

The file is only 35 MB, so it downloads fairly quickly.

2. Unpack the contents of the .dmg file by double-clicking on it.

3. Run the installer:

4. From your Applications folder, click on the VirtualBox icon.

5. Click the New button (you don’t have any other options).

6. Follow the Wizard’s steps. I stuck with the recommendations (Base Memory Size of 192 MB):

7. I chose to boot to a hard disk.

8. Chose to use a dynamically expanding image for my hard drive:

9. The Image File Name can be the same as the name of the virtual machine you’re making:

10. Once the hard drive disk is created, you’ll see it populate your main Wizard. It has a .vdi extension (VirtualBox Disk Image):

11. Now click the “Finish” button.

12. Everything should be looking good, so go ahead and click Start.

13. You’ll get the Auto capture keyboard notice, just explaining that the keyboard will be sending strokes to VirtualBox unless you click out of it or press the Left Command key (Mac).

14. You’ll now be ready to go with your First Run Wizard. Follow those steps.

MAKE SURE YOUR WINDOWS INSTALLATION CD IS IN YOUR CD/DVD DRIVE

15. Follow the OS Installation Setup (in my case I’m installing Windows XP Home). Don’t worry about creating a hard drive partition (just click through to install) and choose to “Format the partition using the NTFS file system (Quick) option. To use function keys inside Windows (F8 particularly), you’ll need to hold down the Function (fn) key, and then press F8.

.

And I’ve got Windows obviously running now:

16. Start Internet Explorer from within your new installation, and download YNAB Pro.

17. Install the YNAB Pro setup file and you should be all set (you will likely need to download and install .Net 2.0. The installer will detect and do it for you).

18. And voila. I’m running YNAB Pro on my Intel Mac, Mac OS X 10.5.5.

Just wanted to post this interview of me by InnovativeEconomy.com. If you’re interested, head on over there and check it out!

Today is Porter’s 4th Birthday. For two years he’s asked me why I have to go to work. For two years I’ve told him the same thing:

To earn money, so we can buy food and have a place to live.

When he was really little he actually started to leave money out of the picture. I’d say I’m going to work and he’d respond, “to buy food?” And that, my friends, is how the world works. His first exposure to money and he just forgot about it. Food was the important part.

Last year for Christmas he was given a wallet with a five-dollar bill inside. I was amazed, but he actually kept that money in his wallet for the most part. A few times I found it among the toys in their toy box and I’d bring it to him and tell him how important it was that he keep track of his money (you can’t start ‘em too early). His aunt came and visited a few months ago and we headed off to Target because Porter had decided to assign those five dollars a job: buy a toy light saber.

Julie and I went off to do some other Target-errands while Porter and his aunt headed to the toy section. When it came time to checkout I was keenly aware of the entire process. This was his first transaction and I wanted it to hurt when he spent that five dollars. (The total was actually $7.50 and I made up the difference – a moment of weakness perhaps).

I made sure Porter handed the cashier the five dollars, and waited with baited breath to see his signs of hesitation, perhaps a furrowed brow and a longing look at his wilted piece of currency.

Nope. He handed it to her so fast and didn’t blink an eye. Money was a means to an end (end = light saber).

I used my new found knowledge a few weeks later when I came home from gathering food and was told that the basement apartment below us was now dealing with a broken window, compliments of Porter’s (awesome) ability to huck anything he can heft further than kids twice his age.

I didn’t so much care about the broken window, or even really about the money it would cost. I did want to teach Porter a lesson about what this loss would mean. I sat him down and told him that because it was going to cost money to replace the window, we wouldn’t be able to buy a Wii. His eyes got big and he got the lesson. The Mecham Pie is finite buddy, and you just ate a slice.

[We still haven't purchased a Wii even though I still really want one for, you know, Dad-Son bonding time and things like that. Porter still mentions the fact that we don't have a Wii because he broke the window. The lesson that just keeps on teaching!]

For Porter, the End was the Wii and we didn’t have the Means because he had broken a window.

As an adult with these little dependents running all around me, my Ends are different. Or at least they should be. And I suppose that is where the lesson lies.

This list is not exclusive, but as an adult, your Ends should include:

An Emergency Fund – Guys, give your wife a break and let her have a bit of breathing room! She’ll thank you for it.

Savings for Retirement – Don’t depend on anyone for your retirement except your own ingenuity, creativity, and sweat.

Minimal (or no) Debt Load – Pay off all of your debt as fast as you can and reclaim all of the time, sweat, thought, stress, and tears that create that precious income.

A kid gets bright-eyed with the prospect of spending $5 on a light saber. A guy gets bright-eyed with the prospect of spending $500 on a “modest” gas grill (the one that really caught my eye yesterday was over $900 though – yeah right!). Does the same guy get excited about throwing $500 toward unsecured debt? Or stashing $300 in his emergency fund?

At some point, the earlier the better, your Ends have to change. You’re no longer a kid. For Porter, Money equals things. For you, an adult, Money should equal Security and Peace.

I’m new to the blog, but not new to YNAB. I’m proud to be the lead programmer behind YNAB Pro.

But let me start at the beginning. A couple of years ago, I was looking for a better budget program, and when I found YNAB I knew I’d found a good thing. Jesse and I started talking, and in short order we discovered that we were both excited about the idea of YNAB evolving into more than a spreadsheet. A few months later we released YNAB Pro (to great acclaim).

Since then, we’ve always been trying to improve YNAB Pro, and I’m proud of how far it’s come. Our forums are probably the most helpful place on the internet! If you haven’t before, I encourage you to read through them. There’s nary a question unanswered, and that even includes the ones that leave Jesse and I scratching our heads! I honestly don’t think you can find a friendlier group of folks anywhere. In addition to helping each other, our customers really help us too. When they share their ideas (and yes, even their frustrations), it helps Jesse and I to know what to focus on for our next release. Up until now, there’s only been one problem: time.

What some people might not know is that YNAB Pro has been a side-project for me for the past couple of years – not a full time gig. (For my day job I was a programmer for a big video game publisher.) I’m proud of what we’ve accomplished in this time, but I have always wanted to accomplish things faster. When you know it will just take a few minutes to add a feature that will save thousands of people hours of time managing their money, you want it done yesterday!

I’m excited to announce that as of a few days ago, I began working on YNAB Pro full time. I get to work with Jesse on budget software all day long, which means more frequent releases of YNAB Pro, which makes for a happy lead programmer and even happier budgeters.

I’ve already begun working on the next release. I’m fixing lots of little annoyances, like allowing you to easily change the order of the account tabs so that people don’t have to do silly things anymore, and making it easier to import bank transactions. I’m also going to be adding official transfer functionality. I’m excited about it. Have something you’d like to see get added to YNAB Pro soon? Please let us know!

P.S. For those of you scratching your head at the title of this post, that’s how we say “Hi” down here in Austin, Texas.

This post was inspired by JD’s Father’s Day Post at Get Rich Slowly.

My mother and father are both currently visiting Jerusalem. They left on Thursday and won’t be back for two weeks. My mom asked each of the (six) kids to write something for our dad that she now has probably given to him. I wrote him a few-sentence letter stating my admiration for some of his (many) great qualities.

Julie and I are staying at their house with the three kids down here in Arizona — waiting to settle on a house we purchased (but having our lease run out at the house were renting about a week too early!). So this is an interesting time to write — being surrounded by a place that holds about 16 years of memories for me.

Staying in line with money topics, I want to share a few things I’ve learned from my dad regarding money. He’ll probably never read this because I don’t believe he knows what a blog is, but this is for him nonetheless.

My dad taught me to take care of the things you have. Cords to appliances are always wrapped nicely, tools are always put away, etc. He always related the story of the man going door-to-door looking for donations. He stopped at a house and, before he rang the doorbell, overheard a man in the back yard scolding his son for leaving some nails out in the grass. “These nails are rusted now and aren’t nearly as useful!” The man at the door thought to himself that this was probably an exercise in futility — to ask a donation of a man that cared about a few nails. He rang the door anyway and the man ended up giving the largest donation the man had ever collected. Lesson: Understand Value.

My dad taught me to work (he may claim he didn’t successfully). When I was twelve I was tasked with mowing our 1/2 acre yard. Our lawnmower wasn’t the kind that pulled itself — it took some heav-ho pushing – especially for a 100 lb. 12-year old kid. Pushing that thing I think I looked more like those guys cruising on their choppers, with their arms up high. The lawnmower was a beast to push. It took me about 3 1/2 hours to do the front and back. I would put it off, which would only make things worse because the grass would be so much longer. The grass catcher would be heavy and I had a hard time dumping the grass into the bins. I had an even harder time dumping the bins full of grass into our mulch pile in the very back of the yard.

As time passed I became taller and stronger. By the time I left home I could finish both yards in an hour, do a better job, and enjoyed the entire process. To this day, I love mowing lawns. Lesson: Learn to Work.

The first personal finance book I read was The Richest Man in Babylon. I devoured it. I don’t remember how old I was — probably pre-teen. When I was 14 my dad gave me a book from a talk-show host that was starting to make his mark, named Dave Ramsey. The book was Financial Peace and I loved it. I credit that book’s principles with keeping me out of debt all these years. I’m thankful to my dad for recognizing good principles and passing them on to me. Lesson: Read.

My Dad’s an attorney (a nice one!). He’s always been able to provide for us. He claims to never really have been “book smart” but somehow he made it through Law School. He claims he’s always had to work harder to be average than the your average-average guy. I don’t buy in to my Dad’s whole, “I’m not too smart” facade he puts on. Where do my dad’s smarts come from? His dedication to his family. As a kid I was blessed by the fact that I never once thought there wasn’t enough money for food, shelter, and clothing (though maybe not the exact clothing I wanted – like Air Jordans…). My Dad worked so we had all the things we needed. He openly states that he’s never really enjoyed being an attorney, but doing that he provided for his family and, in that, found his purpose. Lesson: Provide for Your Family.

My Dad taught me to play chess when I was very little – probably six? I have a hard time remembering. I do remember lying on my stomach staring at the board, and being beat time and time again. Not just beat – slaughtered – in very few moves sometimes. I don’t know what our overall record is, but he’s winning. When I was 14 we were on vacation and I beat him — three times in a row. It rattled him good and I still relish the moment. But for eight or so years, he beat me again and again and again. Lesson: No Freebies.

Thank you Dad!

For the first several years of our marriage, my husband nagged, what felt like fortnightly, “we need to sit down and make some financial goals.” His suggestion was met with a habitual eye roll, (because I’m stubborn and snarky,) but also because I’m a financial first-grader in many regards and didn’t fully understand what he meant by “financial goals.” My response was always a reluctant consent for procrastinated compliance, “okay, but let’s not do it tonight, maybe at our next budget pow wow.” I mistakenly equated making financial goals with nailing down some arbitrary retirement figures upon whose altar I’d be sacrificing not-so-necessary, but oh-so-desirable Target purchases for decades to come.

As is so often the case, what we needed, even before financial goals, was better communication. Once I was freed from my errant preconceived notions and realized that my desires for a new camera or two inch blinds for the living room windows could also be included in (and eventually fulfilled by) financial goals, I was cheerfully onboard for setting them and working towards them.

Our goal setting sessions have, as a result of improved communication and understanding, become more successful and enjoyable. And the striving for said goals, even when it requires consumer restraint, has been equally satisfying.

Here’s what’s helped our financial goal-setting:

At the goal-setting table it is mutually understood that there is no such thing as a stupid goal; if it is important to one of us, it’s important enough to at least consider making it a bona fide family goal.

Breaking up our objectives into short, mid, and long term categories has helped us prioritize our desires and devise appropriately aggressive savings strategies to reach our goals in a time frame we’ve mutually agreed on.

I hesitate to even mention this because it seems so obvious as to go without saying, but the only way your voice and your desires will ever be considered in the financial plans is if you actively and assertively participate in the laying of those plans. In abdicating the responsibility of setting financial goals to my husband, I was also abdicating my right to have my desires considered in the financial plan. It wasn’t until I stepped in as an active and opinionated participant in the goal-setting process that I realized how productive and satisfying a process it could be.

Having goals on the list that I feel strongly about has made it easier to resist enticing little non-necessity items that whittle away at the available funds sum. I don’t feel like a retirement martyr when saying no to a cute pair of earrings, because instead of trying to imagine the gratification that tiny sum will bring us in our grizzled seventies, I’m imagining that $7.99 going into the “new blinds fund,” feeling totally triumphant that my current restraint has just brought us closer to less distant future gratification.

Sometimes we have to speak each other’s financial language to help each other understand the importance of certain goals — it helps me contextualize his lofty aspirations for long-term savings when my husband says, “saving aggressively for the future is as important to me as our weekly date night budget is to you.” With just that quick sentence, it’s suddenly very clear to me how non-negotiable the long-term savings is for him, and the overall give and take feels less sacrificial and more altruistic.

With mutually defined financial objectives, we are able to consciously align our spending with what we value because we have determined and discussed those values (read: goals), in a moment much more rational and clear than the one at the check-out stand. Like most of my husband’s suggestions that I’m reluctant to agree to, operating with financial goals in mind has proven to be a tremendously helpful step in the right direction for the monetary arm of our household.