If YNAB only had... A purposeful way to help broke people get a grip on managing money.
So, I've been using YNAB for a little over a month and figured I'd share some newbie perspective. Jesse mentioned he occasionally gets useful feedback from the forum, so maybe this will trickle his way as well.
As a bit of a precursor, in terms of getting started with the software, I'd say I'm getting more comfortable using it, but it was a very tough start.
Even for someone like me who's fairly tech savvy and advanced in various software products including enterprise class platforms for business, and CAD as well as web design, graphics, WordPress, SEO, SEM, etc. YNAB was very, very complicated. I also root, flash and program Android operating systems, as well as build and repair computers, etc. I can do basic programming on PLCs, etc. But... YNAB is in a league of its own as far as being really quite difficult.
I've had several support members graciously help, tried attending a class, and have exchanged numerous messages back and forth with support, but its like trying to learn Chinese for me. I don't speak Chinese, and likewise I'm not fluent in money management or spreadsheets. I'm not an accountant, bookkeeper, tax preparer, etc. Just someone who has mismanaged my money for decades and wants to do better and stop living paycheck to paycheck.
I've watched the primary/basic YNAB videos and several others from unaffiliated YouTube ynab users/teachers. I've also watched a few official ynab training videos, as well as whiteboard videos. They're all good and helpful. As for the method, I've listened to Jesse read his book several times over on Audible. I listen to at least a dozen of his podcasts per weekday. I get it.
The disconnect I believe, is that it seems like, or feels like, from a newbie perspective at least, that YNAB and Jesse are of the impression that their target market is made up almost completely of people who already understand money management, budgeting, finances in general, money software, spreadsheets, accounting and aren't broke. They're endearingly referred to as ynabers. Nothing wrong with that at all. Its just that for a newbie without money skills, I've felt like a checker player at a chess club.
I think there's a huge untapped market for ynab in the self improvement area of money management. For people like me who don't have stacks of cash and flush bank accounts, but are looking for an easy, simple system to help them stay afloat another day, or week, or month and and hopefully get some financial peace of mind quick fast and in a hurry.
Anyway I've felt better having at least some sort of budgeting tools, and having gained some methodology from the training, videos and software. But, here it is, another paycheck and I'm still dumbfounded as to what to pay with it. Mortgage? Credit cards, or?
Well, that was all I had to say, over and out.
Habanero Salsa said:
Your proposal, whatever merits it may have, isn't going to educate, train, or teach budgeting habits any more than TurboTax is going to make someone a CPA. You're insulating users from the decision making and having the software do it. Users are unlikely ever to learn anything other than how to start a wizard.
I agree and you're correct, however it'll help the user reach their end goal much easier and safer. And, in saying that I'm really eating crow because as a collision repair professional, I'm often harkening back to the days when cars didn't have airbags, sound deadening, phenomenal brakes, steering, suspension and tires. I grate my teeth and smile when folks come in after smashing their cars up in some avoidable incident, but what I really feel like telling a customer with a smashed up 2019 anything, is "Lord what would your driving be like in a 73 LeSabre? You'd be lucky to make it out of the driveway alive." But I've also come to appreciate that while people have become much worse drivers because their vehicle's onboard computer and safety systems do so much of the driving for them, I can't argue with the fact that cars are safer, more reliable and collisions way less severe than in the good old days. People walk away from accidents unharmed, that would have otherwise been severely harmed them in the old cars. Take for example the #1 safety device in a vehicle, the one that's saved more lives than any other innovation... Have you guessed it? Stability control. Something nobody thinks about, because its all behind the scenes, doing its job to keep their car stable while they zigzag through traffic at 20 or 30mph above the posted speed limit, whether its dry, raining, snowing, etc there are modern technologies at work, keeping the driver, their passengers, and other drivers around them out of harms way. I can't recall one complaint from anyone about it, because they aren't even aware of the engineering, programming and software that's making them feel like they've got good driving skills.
Not sure if that's the greatest analogy or not but the point is, that sometimes people just want to get from A to B without needing to master certain skills. In my example, its driving. In yours, finances.
Every single veteran here was a newbie at some point.
Nothing in life worth anything is easy.
Exactly what I was thinking while reading through Silver Inspector 's post. I do remember reading the support materials over and over way back in the day. It took me a good little while before it clicked for me. I learned even more when joining the old forum back in 2010. I didn't become a YNAB expert over night, that's for sure. The thing is, the software is more user friendly now than ever. There are some getting started systems in place now that weren't there in the past. Also, there weren't classes available like there are now.
I do think you have some good ideas, Silver Inspector . I don't know if there's anything like it on YNAB's road map but you could suggest it to them. Right now, their support materials are mostly separate from the software. But if they ever do employ some expert systems, it will be too late for you. As far as I know, there's nothing like that currently on the market. Unfortunately, you're just going to have to figure it out like the rest of us had to.
I'd recommend Dave Ramsey's book, The Total Money Makeover. That in conjunction with YNAB is in my mind the best combination for somebody in debt and not making enough to cover their basic expenses. As far as the latter, there are only two choices. Cut down your expenses until they're less than you make or figure out how to make more money. Best of luck to you on your journey.
I do think you have some good ideas, Silver Inspector . I don't know if there's anything like it on YNAB's road map but you could suggest it to them.
Thanks, much appreciated. I've actually done Ramsey's FPU, but his budget app is really pretty poor. I did okay with it, but budgets are all pretty much the same, in that they don't really represent real life too well, unless you're way ahead of the curve. That's one of the reasons I was googling around looking for some decent budgeting software when I found YNAB. Its probably better than Everydollar in some ways, but still not really much help there for someone trying to get un-broke. There's such a limited amount of time to work on finances in any given week, the more streamlined it is, the better. I've been looking more into the simplebank app which appears to function similarly to YNAB, without as much manual intervention. Still not as advanced as one would think money management software could be approaching 2020, but compared to others its fairly advanced.
Just an update to this to say I think possibly I figured out how I can go from broke and frustrated with YNAB, to having a surplus and actually using it effectively. I racked my brain trying to figure this paradox out, but think I'm on to something...
After listening to Jesse's "Debt Stories" on his Podcasts, its pretty clear that there are people that have utilized YNAB to get from broke to out of debt. I've made some big changes to my personal life to try and take advantage of the software's ability to straighten lives out.
Like Jesse says in his podcasts, people's brains work better when they have constraints. My big constraint was that I wanted to use YNAB software to get on track,and out of debt, but since its setup to work from the position of being current and having at least a month's worth of cash on hand to budget properly, I had to get to that point quick fast and in a hurry. Otherwise, being broke and behind on bills, it was like chasing my tail and having nothing to budget without overspending seemed futile.
So, what I did was a slip stream refinance to give me some breathing room between mortgage payments. Then I took all but a couple of my credit cards and started a debt management program, to get some additional cushion between months. My credit score is tanking for awhile, but it should allow me the opportunity to actually have money to budget according to the YNAB principles. I'm about to go into February with a surplus that I can budget! As long as I follow YNAB and don't experience a job loss or major financial setback I should be able to make a go of it from here.
Every time you're paid, just rip through your categories incrementing the budget value by the per-check contribution. Do this on a priority basis, because you'll stop when TBB is $0. The things that don't get money are therefore less important.
What do you do if you run out of money but still have categories that "need" to be funded? Something else has to give.
One reason I favor the Per-Check True Expense approach because I think it's easier to see what has to give compared to the typical "paycheck-specific subset of categories" approach. There is no "other" check that might let you "make it up"... somehow. The total of everything you want to fund is constrained by your single check amount. No gray there.
So what gives? Two things: scope or timeline.
Scope is straightforward -- make some higher priority expense less. Instead of a $200 cable bill, cut it down to a $10 Netflix bill. If a vacation is a priority (your budget, your call, right?), instead of a $3000 vacation away from home, have a $300 "stay-catation". Obviously, the difference required per check can let you fund lower priority categories.
Timeline -- you push back the outflow to allow you more time and contributions will decrease. Let's say you are saving toward something that will outflow 4 months from now (e.g., a vacation). If you push that back to take the trip in 8 months, then your monthly contributions will be cut in half. The difference can be put toward something lower on the priority scale that wasn't originally funded.
A thing related to timeline is moving beyond the startup-phase. An annual expense due in 3 months after you start will require whatever it requires (amount / # of paychecks). However, once you've paid it, you can spread those contributions over a year's worth of paychecks, resulting in contributions 1/4 the size as before. Again, allowing you to go deeper into the priority list.
Lastly, just be consoled by the fact it's the lower priority items that are falling by the wayside. No one can afford everything they want, but you can make sure the important things are funded.
Have you tried to create a journal and post all your expenses and ask fellow forumers to help you by suggesting where you could cut ? It uses to be done a lot on the old version. It is clearly not a pleasant though to have your lifestyle scrutinized by (friendly well meaning) strangers but you could get some useful suggestions?