I remember the day everything changed: an afternoon in May of last year, when North Carolina was already hot and humid. I was at work, catching up on social media (shhh) when a friend’s post caught my eye. “Just paid off our mortgage AND we’re putting 20% of our income into savings. Thanks, YNAB!”
That kind of humble-bragging usually makes me roll my eyes and continue scrolling. But this time, I paused. I didn’t have a mortgage, but that was only because I could barely afford my rent. And savings? Yeah, right. As I stared at my friend’s post, waves of envy, shame, and curiosity washed over me.
“What’s YNAB?” I finally typed. I didn’t know her answer would change my life.
The School of Hard Knocks
A year ago my husband and I were in our early 30s, working grown up jobs complete with 401Ks and health insurance. This was a first. As chronic students, we’d spent our 20s taking turns going back to school. Now, with five degrees between the both of us, we were ready to stop pouring money into tuition and start putting it toward our future.
There was just one problem—we had no idea how to do that. We finally had these shiny new paychecks, and not a clue what to do with them.
Part of the issue, at least for me, was a total lack of financial role models. My blue collar parents hadn’t been to college, didn’t save for the future, and raised three daughters while living paycheck to paycheck. When I asked them questions about loans, investing, or budgeting, they shrugged: “You’re smart. You’ll figure it out.”
For a while, I believed them. I convinced myself that an education was my ticket to a stable future, the magic bullet my parents never had. In reality, my husband and I finished school saddled with a $13,000 credit card balance and six figures worth of student loan debt. Not exactly the bright future I’d been promised.
So when my friend explained YNAB’s Four Rules, I was intrigued. Money was confusing and scary. But rules? Rules were different. As a lifelong student with a Type A personality, rules are my jam. I decided to treat budgeting like college, using YNAB’s Four Rules as my textbook. Class was officially in session.
Wake Up Call: Frugal Isn’t Enough
A year ago we were doing everything “right”—or so I thought. My husband and I were extremely frugal. Our cars were more than ten years old. We didn’t travel or feast on avocado toast or buy new clothes. And yet, both our debt and our savings were stagnant. Where we hoped to see our debt shrink and savings soar—nothing. We were living paycheck to paycheck, just like my parents, and we had no idea how to break the cycle. We needed a teacher, someone who could lead us by the hand without making us feel dumb or ashamed. That teacher was YNAB.
As soon as I got home from work I downloaded the free trial, poured a giant glass of wine, and settled in for a long night of tutorials and training videos. I won’t lie—the learning curve was steep. I was starting from scratch, and the rules were hard to wrap my mind around. “Give every dollar a job.” Even our savings? “Embrace your true expenses.” Does that include fancy beer? “Roll with the punches.” Isn’t that another word for failure? “Age your money.” HA!
After a few hours (and a few more glasses of wine) things started to sink in. As I created new categories, entered transactions, and scheduled my bills, I realized it wasn’t the day-to-day stuff that was messing up my budget. Expenses like rent, Netflix, and groceries were predictable—monthly obligations I could predict. It was the unexpected events that threw us off. Holidays. A plane ticket to a friend’s wedding. Our dog’s vet visit. A single surprise could wipe out any progress we’d made, and every single month there was something.
Except “surprise” wasn’t exactly the right word. The more I had to accept that Christmas is the same time every year. And that I had RSVP’d for that wedding six months in advance. And every year, at one point or another, we ended up at the vet. This was the moment YNAB started to click.
Paying off debt, I realized, wasn’t just about being frugal in the moment. It was about planning for what was to come.
I created a category called “Future Funds” (right below “Treat Yourself”—because budgets can be fun, too!) and every time an infrequent expense arrived, we took the hit, paid it off, then gave it a line in the budget. Assigning a goal showed us how much we needed to budget each month in order to prepare. When that expense came around again, the money was ready and waiting. I felt like a magician, making money appear out of thin air. In reality, I’d been saving it up so incrementally, I never even missed it. It didn’t even feel like a sacrifice.
Lessons For A Lifetime
Once we embraced our true expenses, our budget fell into place. Once our money was split into categories, we found creative ways to cut spending. We ditched our iPhones for Androids to lower our cell phone bills. Meal planning became a sacred ritual. We embraced overtime and side hustles. We funneled everything we saved toward our number one goal—saying goodbye to consumer debt. And after one year with YNAB, we paid off our entire $13,000 credit card balance. Our crash course in budgeting was over, and we’d passed with flying colors.
While watching that balance reach zero was amazing, the benefits of learning to budget were much bigger than a single bill. It was about gaining control and peace of mind when it came to our finances. The first step of YNAB is to assign every dollar a job, and “job” implies work.
This simple idea—that my money should be working for me—was a light bulb moment. Having a plan for our money made me feel powerful. Our budget was working, and I was its boss.
This incredible lesson came just in time. As it turns out, my husband is going back to school again. I know what you’re thinking, “Haven’t they learned anything?” But the truth of the matter is, for the first time, we are going into this with our eyes wide open. When we were weighing our options, we had a year’s worth of numbers to run. Thanks to YNAB, we know exactly what we need to get by without going into debt, and we have a decent amount of money in savings to fall back on.
This, I’ve come to realize, is YNAB’s real power: A budget allows you to control over your finances. It gives you the ability to plan for your future, even when the future isn’t what you expected.
Christine Hennessey is the writer behind Better Than Never, a budget living blog for late bloomers. She lives in coastal North Carolina with one husband, 15 chickens, two beehives, and an overweight dog.