The police officer, school teacher, engineer, firefighter, attorney, doctor, professor, designer, manager and rocket scientist all have one thing in common: they’re killing it financially with YNAB.
I run a picture framing shop that has, at times, been a gallery too. In the heyday of the framing business (the 90s), I had three part-time employees and the business bustled. Now times are different, and I work by myself. To be honest, I enjoy it more. I also paint, traditional landscapes in a style I call "fuzzy-realism." They sell, and as I reach my retirement years, painting will be what I continue with. I'm divorced, and have three grown sons. Two have good work ethics and the third is a perpetual student. None of them live at home and I hope it stays that way!
I live in a small, picturesque country town that's a two hour drive from New York City. It's been my home for almost 35 years. The dairy farms are going and the large estates and fancy horses have moved in. I earn my money here, own a small business, and make a pittance but it keeps me going. Having smart, cultured, wealthy neighbors is good for my business but means I fall way down the scale in comparison.
For years I ignored the whole issue of money. I ignored bills until they HAD to be paid. Threats of ruined credit washed right over me, and I was like an ostrich with it's head in the ground. Paying attention to finances smacked of being part of the Establishment--hard for us children of the 60s. Then I realized I could be headed for trouble. I think the financial information I was gaining from the internet, as it grew and became such a factor in my life, made me 'wake up'. Credit card balances were growing so I played 'transfer the balances'. I was able to see my credit score and, although not wanting to borrow, I wanted to be a good risk, just in case. In April of 2006 I began a notebook where I recorded bills and cc payments, dates due, and payments made. The balances on my cards were still growing, but my bills were getting paid on time and my credit score rose. The balance topped out at about $15,000. Not a huge amount, but for someone whose annual income might not even be twice that, it was a growing burden.
My notebook with recorded debts and payments was a big help in getting me to move forward. I was headed in the right direction, but I was not handling my overall financial situation well, meaning I was not becoming debt free. I turned 65 years old in 2008, and although I had always thought things might not be so good when I reached retirement, I did not expect a global financial meltdown. My nest-egg for retirement (mostly from a small inheritance) basically imploded, and I realized my plans for a workable retirement were no longer workable. I like what I do well enough to do it for some more years, but I needed to make sure at some point my debts were gone so I could survive on less. The cost of owing money was suddenly very clear to me. I could not retire and still be making cc payments of $700-800 a month.
I could tell from the first that YNAB was what I needed. But I struggled at first to find how best to set it up for me. I took the webinars which helped with the details, read the message boards, and tweaked it. I added accounts--then took them out. I started a separate budget for my business. The process of making YNAB work for my situation was forcing me to really look at my financial standing...and it wasn't always pretty. I would budget money for a future need and then have to take it back to pay a pressing obligation. But the money was there to do that! Something new for me!
YNAB was like breath of fresh air. I started mid-month, and by the beginning of the next month, I was hooked on this budget. Suddenly I knew where I stood. I knew where my money was going. I knew when I was going to need it for what bills. And I felt like a weight had been lifted. I could see where my income fell short, and I could see the effects of my indiscretions in spending. I was learning something I should have learned a life-time ago, that just because the money is in the account doesn't mean I have to spend it. Such a simple lesson: it's okay to let money sit. I felt like I had gained control.
I've succeeded in reducing my cc debt by about $2000 since July of last year, and have added $800 to a retirement account. This is on a very low income, but I am using that income more wisely. I believe I can pay off my cc debt within the next year, and that will be a golden moment! I have not yet been able to build a buffer, and with my income being from self-employment, and therefore erratic, that will be my next goal. Winter is usually a slow time in my business, but it's only the fourth of the month and I think I should be able to earmark the rest of my income coming in this month as 'available next month', so I am optimistic about reaching that point. YNAB has given me the opportunity to 'see' my finances. It has reduced my stress, and encouraged me to work smarter. I see the value in planning ahead, and YNAB helps me plan. I love knowing where my money has gone. I love seeing it s-t-r-e-t-c-h to meet my obligations. I take pride in keeping the frivolous spending at a minimum. I like knowing where I stand.
I'm not so eager to acquire 'things' now, as I feel I see the true cost more clearly. I am reducing my 'stuff', and making room in my life for living. I'm re-learning a forgotten skill of 'making do'. I don't actually feel any richer, although my net-worth has grown, but I do feel more comfortable and that is 'priceless'.
It has reduced my stress, and encouraged me to work smarter. I see the value in planning ahead