I used to be a die-hard pen and paper budgeter. Transactions were logged daily, mental math was done, and in each budget category I could see exactly what I had spent. There’s absolutely nothing wrong with that. Tracking spending is incredibly valuable. Even if you’re habitually frugal, expenses have a way of moving up and down each month, and it’s helpful to know if you’re still on target. The trouble comes when you want to go from tracking spending for a month to compiling that information in a useful way.
My method of compilation used to be in custom spreadsheets I designed (and redesigned, and tweaked, and…) to give the information I needed. Tracking averages, seeing trends, etc. I thought spreadsheets were superior because I could design them to track whatever parameters I wanted.
Unfortunately, that takes a lot time.
I have no problem spending a little time touching base with money. I am, after all, the steward of the house. In looking to reduce time and simplify my tasks, I could have gone all the way to a more passive tracking solution like Mint to Personal Capital. Those would have reduced the time I spent budgeting, particular in spreadsheet vision, but in reducing that time they would not have solved the issue.
The reason I spent so much time futzing with spreadsheets was because I had a hard time translating past to future. Once the tracking habit is there, past is easy. But there’s a reason they say hindsight is 20/20. Knowing the past is not what the steward should be (so) concerned about. Their job is steering the household through the future. Future planning was always hard for me until I finally gave in to (numerous) recommendations and tried YNAB. $54 (via my link) might seem like a lot for a budgeting tool when there are so many free options about. I’m not even a person to use the “time is money” argument. But YNAB has saved me time; more importantly, it’s provided a great deal of sanity when attempting to pierce the veil of the future.
Obviously it’s not magic. Unexpected expenses crop up, but for me it’s an invaluable tool. And it’s finally given me the confidence to get a little more hands-off with money. Instead of logging receipts daily and paying (some) bills manually, I’ve automated nearly all of it.
- Auto-Pay: every single recurring bill is automatically paid. I’ve used online payments for years but rarely put any of them on auto-pay. Nearly all debitors have a feature to do this via their website. For the last few stragglers, I used my bank’s online bill pay feature. Tomorrow will be the first time I’ve written a check in months (assuming our permit for chickens gets approved) because it is the only accepted payment method.
- Importing statements and activity electronically: I still keep physical receipts around when necessary, especially for split categories, but instead of logging stuff into YNAB the day I got it, I’ve instituted “Money Fridays”, a once a week time I download the previous week’s credit card and bank activity, importing it into YNAB. I could do it less frequently, but for right now weekly works well, as there are many months I have to tweak categories or back off planned purchases because other things have cropped up.
- Simpler finance date nights: with YNAB’s budget screen, our somewhat involved finance dates have gotten much faster. Sometimes the discussion is just as detailed as before, but I no longer have to spend time putting numbers into a presentable format. It’s right there on the screen.
Has it saved money? Yes and no. Our consumption decisions would have been much the same, but giving me extra clarity about the future has allowed me to be more aggressive about debt repayments and savings goals without needing to keep a large unallocated cash buffer.
How has technology optimized your ability to handle money and make stewardship decisions for your household (be a household of one, or of many)?