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2 May 2013

Three Big Threats to the Bliss of Budgeting

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by Jesse Mecham

I wonder if many people “succeed” with budgeting on their first attempt. It must have been at least four years ago that Jesse first gave me YNAB, and yet I’m just now closing in on two months as a “real budgeter.” Actually, “real budgeter” is too strong a title. How about Budgeting Intern?

My attempts at budgeting are similar to my (and many others’) attempts at sustained scripture study.

“How many times have you read the Bible cover to cover?” someone might ask me.

“Uh, well, none.”

“How many times have you read the first few chapters of Genesis?”

“826.”

So why do we all fall off the wagon so often?

We’re sold on the Four Rules. We see the benefits of budgeting, but for some reason, we just stop. One day we’re budgeting; the next day we’re not.

Here’s my take on why I kept flaking:

I Kept Breaking Rule One

I didn’t even know I was breaking it (because I didn’t attend one of the excellent YNAB live classes – which would have sorted me out in no time) – but I sure was. I kept trying to budget for an entire month before I had an entire month of money available to budget.

So I’d make these estimates across all these categories, and the total budgeted amount would look ridiculous (because it was), and I’d throw up my hands. “I guess budgeting works for some people, but not for me. The numbers just don’t work.”

The numbers didn’t work because I was treating categories as guesses, rather than treating them as official jobs for each dollar. My budget wasn’t reality. It was what might happen, sort of.

As a budgeting intern, I now understand that you always budget to $0, and you never budget money you don’t have.

I Over-Estimated the Hassle of Entering Transactions

…and underestimated the benefit. These days, YNAB’s free mobile apps allow Kate and me to enter 90% of our transactions at the point of sale.

Before cloud sync and the mobile apps, it would only have taken two or three minutes per day to open my online checking and credit card accounts, look for any new transactions, and square things up. Why was I so convinced the only “efficient” way to deal with YNAB was a weekly or monthly import from my accounts?

I’d fall behind on my transactions, then mess up the import process, so my numbers were always wrong, and I’d quit (again).

My budgeting internship has taught me nothing raises awareness like entering transactions at the point of sale and reviewing the budget daily.

I Handled Credit Card Balances Incorrectly

I’m grateful to say I no longer carry any credit card balances.

When I did have balances (on cards I was still using), they constantly made a mess of my budget. One of two choices would have solved this problem, but I was too lazy to carry out either:

All said and done, I can’t blame any of these circumstances for my budgeting setbacks. The reality is I hadn’t fully converted myself to the joys and disciplines of budgeting. Once the pain of not budgeting exceeded the temporary discomfort of creating the habit, YNABing became a breeze.

Have you ever fallen off the budgeting wagon? Why? And how did you get yourself back in the groove?

Your Next Step

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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