Wednesday, January 15, 2014

Budgeting Away the Tightwad

Opened this today. Are you serious, Dove?
By Mary C. Tillotson

The perfect combination of having money saved up and no imminent moving plans fell into place, and my husband and I decided to replace the four-inch piece of foam (taken from a hide-a-bed couch his brother was throwing away) we'd been sleeping on for a year and a half with a real mattress.

It was like graduation or marriage or buying a house -- one of those things that makes you officially an adult, and for real this time. We went to the mattress store and found that the most comfortable one was, happily, toward the low end of our price range. We paid for it and felt very proud of ourselves. On Friday, we brought it home.

I haven't slept well since. Last night, for example, I spent the hours until sometime after 2 a.m. designing (in my head because screens only promote insomnia) a powerpoint that would explain everything a reporter would need to know about education reform. Not because I needed to, but because I like sharing what I know and haven't used powerpoint in ages. And I was bored.

This is why I hate spending money. Because sometimes, through no fault of your own but through what definitely feels like your fault, you end up working lots of hours to pay for expensive things that are actually kind of a waste.

Before I married, I thought there were two ways people spent money: responsibly and irresponsibly. So I rolled my eyes at all this stuff I read about money being a huge point of marital tension and one of the main reasons couples divorce. I mean, come on. Luke and I are both responsible about spending money, and we both know we can't buy a summer home.

We got married and found out we have very different ways of being responsible with money. I already told you how I feel. Luke, on the other hand, has this idea that the whole point of money is to spend it on things that are worth having or doing. (Weird, right?) So when he gives to Good Causes it's so those Good Causes can spend the money on things that are worth having or doing, and when he saves it's for spending money on things that are worth having or doing in the future. I would rather give it to the Good Causes, in part to relieve myself of decision-making stress.

This is Luke in college: My friends all want to go out to dinner. I still have money from my summer job that's not earmarked for anything else. Let's go! Sounds like fun.

This is me in college: My friends all want to go out to dinner. Restaurant dinners are expensive. Can I afford this? Let me think. College students notoriously don't have any money. I am a college student, so I must not have any money. *Angst, stress.* Plus, the food might not be good and restaurants are loud and I probably won't be able to talk to anyone anyway. You know, I actually have other plans tonight.

Then we got married, and what were we supposed to do when our friends want to go out to dinner? This was when we learned how helpful budgeting can be.

You don't need a credit-ruining, bad-check-writing history to benefit from budgeting. Luke and I have always been responsible with our money, but planning out a monthly budget has forced us to talk about money. How much do we have? Are we happy with where it's going? What do we need to plan for?

If you're new to budgeting, or even if you're not, I highly highly highly recommend YNAB. The budget software is fantastic, doing exactly what I used to pretend I did with a pencil, paper, and calculator -- except it doesn't make arithmetic mistakes and doesn't rip when you erase and revise the same line-item eight times. It allows you to "give every dollar a job" and see what you need and want your money to do. The site has lots of helpful videos showing how to use the software and "teaching" YNAB's laid-back but still responsible four-step budgeting method. (We learned about YNAB from a guy who called Dave Ramsey "Good, but too stressful.")

Budgeting gurus often boast that you'll start having extra money now that you're budgeting -- "When you start giving your dollars jobs, you tend to 'get a raise,'" according to YNAB -- but the fact is, budgeting doesn't bring in an extra paycheck. It does make you aware of where your money is going, so it doesn't slip through the cracks, and you can look at the chart and know whether eating out with friends this time is a bad idea. "Your money is more obedient," YNAB continues. "It lines itself up with what matters to you. It's not magic, though it feels that way."

(YNAB software costs $60, or you can use this link to get a small discount and give Luke and me an equally small kickback. Updates are free. If you buy it once, you can download it on all your computers and smartphones, and it cloud syncs -- so the same updated information will be on all your devices. I recommend downloading the one-month trial to see if you like it before buying.)

Planning out a budget has been hugely helpful for me personally: I'm less of a tightwad now because I can tell whether we have enough money for something I would have just turned down otherwise. I know what we're giving and what we're saving, and I helped make those decisions, so I feel okay about spending the money earmarked for spending. We've already decided to spend it; we just have to follow through.

When Luke comes home from the grocery store with some kind of fancy cheese, I don't fret -- I know how much we spend on groceries, and I know he knows, because we talked about it together. I know that he's a responsible person, and now I'm able to tell the difference between an occasional fancy cheese and all of the wine and all of the fancy cheese and all of the fancy meat and the most expensive version of everything else in the store and then going out for dinner every night for a month while all the fancy food rots in the fridge -- the former can be enjoyed, the latter is irresponsible.

(For any concerned feminists out there, Luke has learned as many money lessons from me; he just happens not to be writing this article.)

It's been two days since I started writing this (I'm less productive when I'm tired and crabby), and since then we reverted to our old hide-a-bed mattress as an experiment -- and I've been sleeping much better. Now that I'm rested, I'm tasked with tying this rambly article into a neat bow.

Well, here it is. Budgeting is one of those things like eating healthy and exercising that everybody knows they should do but few people actually make the effort to do. I expect a lot of what I said in this article to get lost in that swamp of not-quite-enough-willpower.

But it's not actually that hard to get in the drivers seat with your paycheck, and it feels good. If you're married, talking over a budget is one of the best ways to relieve money tension.

As YNAB says, "It's good for you. You're healthier for it. You're certainly better-looking (which comes from better sleep and less stress)."

(Note: For family and friends who heard me complaining about this over the phone and are confused about the timing of this post, our publication schedule made me publish it a little later than expected.)

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