How Much Time Do You Have?
On average, new budgeters save $600 by month two and more than $6,000 the first year! Pretty solid return on investment.
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For those of us in the Northern Hemisphere, the month of March marks the first day of spring. At last! It’s nearly time to tuck away our snow boots and coats and possibly partake in some good, old-fashioned spring cleaning.
Don’t worry if you’re reluctant to grab the mop bucket and suds. If actual cleaning isn’t your jam, then how about a quick sweep through the old budget categories, instead?
Your budget categories are important. Too many, and you’ll get lost in the minutiae—it becomes difficult to keep track of what’s important. Too few, and your budget becomes so simplistic that it can’t do its job (we need some level of detail in order to effect the behavior changes that will help us reach our financial goals).
The sweet spot is clarity, which comes when you identify the magic number of categories that works best for you. In other words, the minimum number of categories that you need for awareness and the maximum number that you can have before you’ve breached simplicity.
Depending on your natural inclinations, you may find that you fall into one of two, uh, categories:
The best way to know if you have the right number of categories for you (this number is different for everyone) is to consider each of your categories, and ask yourself the following:
After you’ve assessed your existing categories, consider any that might be missing. Chances are, you won’t have any missing categories because we tend to add categories, naturally, on an as-needed basis.
And don’t miss The Dunkin’ Donuts clause—great food for thought as you consider your category needs.
This month, we challenge you to make your budget categories spick-and-span. You’ll be surprised how quickly you can get this one done and dusted, so schedule a 15-minute date with your budget, right now.
And, join the fun! Shout out your discarded categories or new additions on social using the hashtag #YNABChallenge319. Share a screenshot, or just tell us all about it. We can’t wait to see what you find.
Remember, budgeting is not restrictive. You won’t be spending less, you’ll be spending right. You can do this! Today. Right now. What do you have to lose? Except all that debt and stress. (Ok, so kind of a lot.)
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