Sometimes it’s hard to own up to reality and we’d rather just pretend things are fine. They’re not. They’re bad. Money is tight. We’re spending more than we make. Debt is climbing. Retirement contributions have come to a standstill.
You basically have two choices: 1) continue doing what you’ve been doing and get the same result (which actually is a decline, not a maintenance of the status quo) or 2) change what you’ve been doing and start seeing some improvements.
This small desire for change is a great start.
Facing reality–finally–can be a pretty rough thing. Operating the YNAB Way means you record every single purchase you make, look at how much money you have available to spend and allocate every single dollar of that available pot to a job before you spend it.
If you’re needing to face reality then YNAB will throw it right back in your face (as kindly as it knows how). When you’re recording every transaction you’ll be painfully aware of it. You’ll be forced to address it with an actual thought process (vs. a zero-thought, impulse purchase): “Was that a smart purchase?”, “Did I really need that?”, “Could I have gotten by without it?”.
These questions won’t always be asked, but when you’re attempting to climb out of a hole you’ve been digging for the past while, they’ll be asked a lot. And that’s a good thing.
YNAB also makes sure you’re facing reality by forcing you to acknowledge that you are not made of money, it does not grow on trees, and you will run out if you spend all of it. It does this with Rule One: Give Every Dollar a Job. You have $2,000 available, you budget $2,000 into spending/saving categories and when that money’s gone, your job is done. There’s no pretending, no fudging the numbers, no hesitation. You have a finite amount of money–just like everyone else. Get used to it.
Having your head in the sand financially is a very–eh–unproductive way to go about managing your finances. It only pretends to give you reprieve from your financial stress, but we all know that deep down inside of you there is your Voice of Rationality that screams as loud as it can (muffled by the sand maybe?) for you to stop acting irrationally. You still feel the stress. You can’t ignore it. You can, for a while, convince yourself through exerted efforts and some type of (ir)rationalization that what you’re doing is fine…but that eventually just adds fuel to the fire and the point of change, the “Ahhhhhh!!!!” moment will just be more painful.
I just want to give you a small baby step toward getting your head out of the sand. Pick a spending point that you believe has room for improvement: groceries, eating out, entertainment, etc. (those are the popular leaks in most everyone’s budget) and record what you spend in one of those. Don’t go all out. Just pick one category and record what you spend. Do this for two week blocks and compare each two weeks to the last. Notice a trend?
That downward trend is you pulling your head out of the sand.