Wow. “Bill” – and Bill’s wife – are cool. Although I tried to be civil about it, I pretty much threw the two of you to the frugality wolves and you took it 100% in stride.
Here’s Bill’s thoughtful reply to the feedback he and his wife received on Monday’s post:
“First off, I want to thank all of the wonderful YNAB people out there who have given feedback on our budget. This community is filled with fantastic ideas and suggestions. We are truly amazed at the constructive criticism and upbeat feedback. There was a chance that posting my budget for all the world to see world to see would blow up in my face. When I first saw the post with my budget numbers, I have to say that I got a pain in my gut and was very afraid of looking at the post and comments. My wife and I read every comment out loud to each other and discussed them. This in-it-self was a great exercise, but we took it a step further and are looking to implement some of the great ideas.
We have a few take-aways from it:
1. Yes, our dining out category is huge! Using the awesome reporting tools YNAB we can identify the leaky hole in this category. We spend around $300 of the $800 on Starbucks. This is going to change. I starting drinking the free coffee at work, and my wife is also cutting down on the coffee drinks. (we would go sometimes twice a day) We have a date night about once a month and it usually is about $100-$150 in food and drinks, we can certainly cut back on this as well. The other area is some fast food, I personally hate fast food, however, we (or the sitter) will take the kids for lunch at these deplorable places. We agreed to start making PBandJ or mac and cheese for lunches instead. This should also cut down in this category.
2. The Car Payment – $689 is a ton of money for this. We have two cars, and unfortunately we need two cars. The first car is totally paid for, and it is just regular maintenance at this point. the car is 7 years old and I can hopefully get another 5-7 years out of it. The SUV with the $689 payment, is still under warranty, and we use the car for traveling a lot. We don’t really fly anywhere, and when we go see family we always take the car. sometimes its an hour each way, sometimes it’s 12 hours each way. point is there is a bit of security in traveling in a nice car that won’t breakdown. This also accounts for the fuel expense. The car according to KBB is worth about 35k, we owe 25k on it, I also need to point out that it’s 0.9% financing so almost everything of the $689/m is going towards principal.
3. Savings / Retirement / Education – I neglected to add this to the budget, but it does exist. All of these categories are automatic. What I mean is, 401k comes out of a paycheck, we make the max contribution every year. SEP retirement account is also funded every year to our max. We also participate in our state 529 program for the kids education, these payments are also automatic. Set it and forget it.
Our savings is not where I would like it to be. We have the YNAB buffer and then some, but we would like more for a rainy day. I think my cutting back on some of these other categories, we can build the savings even quicker. Also, one of us has life insurance thru a work program, however we don’t track it. I’ve been toying with the idea of breaking down the income to track taxes, retirement, and other paycheck related items. Has anyone done this in YNAB? I would be interested in hearing more about it… All of our income in YNAB is based on NET and not GROSS. So anything before NET is not caught in YNAB.
4. We are cutting our sitters hours a bit, this will save another $200/month.
5. Fitness – We had a personal trainer at $50 a session. We have since decided to go it alone. This will save. The other programs, is a YMCA family membership at $80/month includes some child care. Other things, Yoga, dance classes, kids swimming classes, bootcamps, soccer camps/ teams, etc… I think getting rid of the personal trainer will help in this category.
6. Cell phones – one is covered by work, the other is a small business expense, and we don’t track it in our personal account.
7. Private school – In a crazy world with sometimes no morals or standards… We are blessed to be able give our kids an upbringing full of faith, morals, and love.
Again, you YNABers have lots of great ideas and points, and too much to address in a single post. I can’t thank everyone for the feedback. Also, thank you Mark for posting my budget, this exercise has been extremely helpful.
One last thought…
YNAB is a product that we totally believe in. No matter how much money you make, the BUDGET is the best tool at your disposal for overall financial health and building wealth. YNAB at any level of income is beneficial.
Bill, you and your wife have made my day. Your open-mindedness and humility have inspired me. I’m getting pretty excited about creating an open dialog about finances in the community.
Your Next Step
Budgeting is not restrictive. You won’t be spending less, you’ll be spending right. So what do you have to lose? Except all that debt and stress?