I spent the morning digging into survey data, trying to tease out angles in the relationships between income, savings rate, indebtedness, emergency funds, etc. Good, nerdy fun.
The more I looked at the data, the more I wanted to hear the stories behind the numbers. I headed over to the YNAB Forum and got lost for about four hours. Now I’m typing with a bit of a forum hangover (you forum lovers know the feeling), but I got an important reminder about the role our money (and budgets) play in our lives.
The thought I kept having while reading YNABers’ forum journals was:
Things Fall Apart.
My physical science class from college gives a fancier term to my idea of things falling apart: Entropy.
“[C]onsider a room containing a glass of melting ice as one system. The difference in temperature between the warm room and the cold glass of ice and water is equalized as heat from the room is transferred to the cooler ice and water mixture. Over time the temperature of the glass and its contents and the temperature of the room achieve balance.”
In the example, the glass filled with ice is one system, but it’s part of a larger system: the warm room. As the ice melts, the entropy of the larger system (the warm room) decreases and the entropy of the smaller system (glass of ice) increases.
“Wow, Mark is really reaching today. No way he can wrangle this mess back into anything remotely relevant.”
Stick with me. Your budget is the glass of ice (because budgeting is so cool), and the warm room is everything and everyone in your life attempting to disrupt the equilibrium in your budget.
What are those disruptive forces? Advertising, excessive consumption by friends and neighbors, legitimate emergencies, and the like. All of it works to destabilize your tidy little money management system and force you to operate at the same disorderly (read: paycheck-to-paycheck, in debt, no retirement savings) temperature.
The only way to prevent the larger, “warmer” system (of careless consumption and check-to-checkness) from wrecking the stability of your cool, tidy budget is to actively add energy to maintain your temperature. In other words, build a little air conditioning unit around your budget in the form of:
- Vigilant checking of the budget before spending
- Constantly reminding yourself of your most important goals.
If you don’t want your finances to be assimilated into the hot mess you see all around you, stay focused, and stay positive. And next time a friend encourages you to spend outside your budget, just say “Yo. You need to stop messing with my thermodynamic equilibrium.”
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