From Podcast #190: The Value of a Fresh Start, the one in which Jesse talks about shaving his head, big piles of money and priorities.
Every five years or so I get permission to shave my head. It’s my favorite haircut. It’s very maintainable—doesn’t require a lot of shampoo or maintenance of any kind. I don’t need to comb it and it’s cool in a summer breeze. It’s a wonderful haircut. And so recently, I shaved my head and was reminded of budgeting (this happens to me a lot).
I was thinking of the fresh start.
My hair had kind of done its thing. It had gotten a little out of control and I was surprised at how it was growing.
And are we not surprised, at times, when the budget just kind of grows a little out of control, where we’re thinking, “Wait, I’ve been following the Rules, I’ve been prioritizing, we’ve been doing our regular budget meetings, so what happened?”
Well, you get comfortable. You are just going about your normal routine, and that normal routine just kind of lulls you into complacency. You aren’t checking into things, you aren’t really asking yourself, “What are my priorities?”
So, every once in a while, you need to just start fresh. Literally.
In YNAB, you just go up to “File” and select “Make a Fresh Start.” It’s one of the most popular features in the software.
If you’ve been doing YNAB for a while, your checking account balance is probably fairly healthy. And actually, after nine months, the average checking account balance for a YNABer is about $3,500—which is far, far above the national, non-YNAB average. So, you have a pretty healthy checking account balance, and maybe your emergency fund is sitting in there with it, maybe not. Maybe your car fund is sitting in there with it, maybe not. But it’s a big balance. You get the eyebrow raise at the bank because of this balance, right?
So, when you do the Fresh Start, instead of seeing all of your money—rightly so—divided up into small job categories, where you’re looking at a $250 balance in eating out or a $20 balance in the rest of your fun money, instead of looking at that big balance.
You are experiencing some scarcity and operating really well in that sphere, and then— suddenly—Fresh Start!—and you see this big, big pile of money and your eyes get big because you haven’t looked at your checking account balance for a long time. And you think, “Oh my gosh! That is a big, old pile of money. What should we do with it?”
And that is when the fun begins.
So, the Fresh Start lets you look at your checking account balance with fresh eyes. And when you see that big pile of money, suddenly previous priorities that got used to, maybe they aren’t as accurate as you once thought. Maybe they are, but maybe they’re not. And it’s a fun time to be able to look at that big pile of money and dream a little bit.
If you’re sharing your finances, you’re looking at your partner, you guys both have kind of a twinkle in your eye—not the romantic kind—the we-did-it-and-look-at-our-big-pile-of-money kind. And maybe you talk about all the options, big dreams, and future plans for a couple minutes.
And then, you get right to it. You fund your immediate obligations, and think through larger, less frequent expenses, and think through your priorities. It’s a healthy exercise.
File > Make a Fresh Start > New outlook.
Or with your hair. I wholly endorse shaving your head. A new outlook on life is always a good thing.
Until next time, follow YNAB’s four rules and you will win financially. You’ve never budgeted like this. For more about how to stop living paycheck-to-paycheck, get out of debt and save more money, faster—subscribe to the You Need A Budget podcast today! But until next time, follow YNAB’s four rules and you will win financially. You’ve never budgeted like this.