I wanted to share my latest YNAB win!!! 🎉Earlier this year, I was only contributing 6% to my retirement plan. I watched a budget nerds episode where Ernie suggested contributing an extra 1%/quarter. Since I've been contributing to a Roth and prefer to do things monthly, I figured I'd increase my retirement contributions $10/mo per month. This triggered a shift in mentality, where suddenly $10/mo was a real, meaningful about to contribute. Instead of staring down my colossal ultimate retirement goal, my goal was to get to 7% contribution, then 8%. I largely ignored the scary retirement calculators, and when I used them it was more for a compass than for actual real time instructions. I got a job that paid more and had better retirement benefits, cut expenses, and today, I signed paperwork to contribute 16% of my pre-tax income to my retirement! I'm not done yet- I started contributing late, so I have some catching up to do, but just passing the 15% mark has been huge!!!
33:42 “to value cash flow over cash” i.e. investing in ‘cash flow’ I also find it’s the ‘circle of life’; if you get to fully fund true expense categories ahead of time (which frees up cash flow), those fully funded true expenses also stops you stealing from future cash flow (like if you have car repairs)! 😳 It’s a thing of beauty when this becomes part of your budgeting DNA.
Yes! My husband fixed our dryer himself a few months ago, and it started making funny noises the other day. I decided that instead of worrying about when it was going to break again, I would add a Dryer category to our budget. Woohoo! We're 1/3 of the way to a new dryer if the old one breaks, or solidly covered for parts. Other categories took a hit, but I'm not worried when I turn the dryer on now. Happy tradeoff.
Regarding rule 2 and trading a lot of pain later for a little pain now. It's true, as a new YNABer, seeing the number of "true expense" categories grow as I think of things to add to my budget is painful as I worry about funding them all, but seeing the even partially funded brings peace of mind as well. As I listened to you guys talk about the pain of rule 2 I realized how important it was that such a powerful word as EMBRACE is used for it. Not remember, not consider, not make note, Embrace. I think that has gone a long way in keeping the importance of that rule in mind.
Ben said the magic word 36 minutes in - "margin" - that is the key to almost everything in life, but especially financial success. The only way to get out of the paycheck to paycheck cycle is to create margin that then allows you to set up an emergency fund, prepare for true expenses, etc. As time goes by it is the increased margin that enables investing, saving for retirement, and building the life you want. Easy concept, hard practice. That to me was the true value of YNAB - it gave me a microscope to examine where additional margin could be created each month.
YNAB win? After five years, I thought I was a full-fledged wine hamburger (not a cult), but this episode tripped another tumbler toward completely unlocking the YNAB mindset. I have been a month ahead for a while now and I’m in the “put the Ready-to-Assign money directly into the next month” camp. But then, as I needed to be implementing Rule 3, I would mosey over to that next month and just roll those punches right back into the current month. I never had to feel the immediate pain of actually making a tradeoff and “Future Me” literally paid the price. The moment when you said that you “...only pull money from a category that was funded that month…to avoid eating away at the future,” you got me to see Rule 3 the proper way - and it is making a huge difference! Thank you Budget Nerds! From now on it’s Rule 3 FOR REAL and no more stealing from “Future Me!” #YNABWin
I’d say lice definitely counts as an emergency expense. You gave that money a job to be there for emergencies, so you don’t have to delay moving money in a pinch. You’ll refill it when the priority to save comes back, after the emergency is over.
Finally catching up on videos, and I had a similar issue with Home Depot and a washer/dryer! I think blood feud is a good way to describe it. But I did get the delivery fee refunded so I guess that's a small YNAB win ;)
I'm so glad I was wrong about the floor! I still bet you're going to see a difference in your electric bill. Congratulations on the new fridge. Love the show.
Yes! I think that old fridge was sucking up a lot of energy cause it just had to work so hard to keep going. Happy to report the fridge is safely in my kitchen now. :) ~BenB
Any tips for when you transfer money from PayPal to a regular account and you pay for that quick transaction fee, and how to ensure that that translates over the transfer without it affecting your financial budget? recently been using the quick transfer for emergency purposes when my card was in the mail for PayPal and the cost differential between the transfers were off by like a couple dollars or less and it wasn't linking the two transactions as one transaction causing for a discrepancy in like a couple hundred dollars from the multiple transactions. Ex: $203 was transferred from PayPal to Chase checking and of the $203, $1.30 was a transaction fee to the transfer amount that actually enters the chase checking is only $201.70 so the transfer and the inflow don't link and you can't apply an additional category to that one transaction to show the 1.30 was a cost associated with transfer.
Wow, Amazon just did the same thing to me that Paramount Plus did. We're seeing if Prime is worth paying for to us and taking a break. Literally just cancelled the subscription, went to order something, and they offered a free month of Prime 😂
I just had to replace our home warranty service because our house has slowly crumbled down around is because of poor previous ownership and I would rather haggle and pay a yearly price with a deductible to have someone come fix our house rather than find someone on our own and pay a lot more. But I am someone who will price match things and kvetch until I get what I feel is a good price so it offsets the cost in my mind. My dog also just had surgery for miscalculating his escape and I know the cost will be reimbursed with surgery and can be plopped right back in the 'pet emergency fund'.
I have a retired friend who had a part time job at Enterprise car rentals. One of his duties was cleaning out rental cars, and often he found loose change. He'd collect a jar full, have it counted at his bank, and dutifully tithe 10 percent of the amount to his church.
Question: If a budget is considered to be an estimate of income and expenditure over a set period of time then how is it that one could experience a possible financial collaspe unless they have not accounted for inflation etc throughout the budget prior to using set budget as a blueprint to further navigate them throughout the hour, day, week, month, quarter, and year which in turn means that its very possible that one may not be either properly utilizing the budget or using the right budgeting system in general.
@@vincentapa1376 No I analyze the market and forecast how to create a budget based on any data gathered prior to creating a budget that in which will align with how much funding is availible to further invest towards securing any short or long-term investment listed throughout my budget which by the way is considered a investment portfolio which in extension is considered the beginning stages of investing.
@@hierarchyfinancebureau1369 I'm confused- why you are here? Because you don't sound as though you actually use a budget. If people knew everything in life, yes, they could plan for every contingency. (BORING, by the way) Since I don't have a crystal ball I budget and save for emergency expenditures. The more I plan for emergencies, they less likely I am to have to use my emergency fund- because I've planned for them- they are no longer an emergency. Like I asked before, what is it you are searching for here- clients?
@@summitseeker2333 Well my dear don’t be confused I’m here to learn which is why humans have been created therefore I gather information regarding my field of study to create strategies that in which will not only grant myself a greater understanding of the subject but others as well I don’t take the easy way out I actually do the work and don’t make excuses about why I don’t understand what it is that I desire from life…in extension to carrying out the task assigned to me by the lord so please don’t be confused get educated…. any more questions
@@summitseeker2333 Based on the way you’ve responded I can detect that you don’t understand the mind of an educator because if you did you would never discourage a student (learner) from making an observation or asking a question to the teacher (educator) therefore maybe you shouldn’t be here and by the way I can detect that you do surface level work which is why it’s boring to you may not be that way for others just for future reference dear.
Question: Why would one have to trade anything throughout their budget if they have properly distributed any revenue generated throughout the year towards anything in life that in which they desire unless the budget in itself is causing friction in regard to them actually learning how to make wise investments over the entire duration of their financial journey which in turn should secure all things desired?
I want a new TV that's worth $500, I receive a paycheck for $1000 but have $1000 of bills whether it's housing, utilities, groceries... I have to trade off that new TV until I can work it into my budget.. I'd rather my pets have food than a brand new TV and that's the trade off
@@jena.t The idea should be to secure as much of the life we desire to live based on the amount of funding one has available which in turn is the true purpose of a budget.
I'm like Ernie now that my debt isn't such a big part of life. The company I work for just went from public to private, causing a small windfall of my stock being cashed out. Still trying to figure out just what I want those dollars to do 🫠
I wanted to share my latest YNAB win!!! 🎉Earlier this year, I was only contributing 6% to my retirement plan. I watched a budget nerds episode where Ernie suggested contributing an extra 1%/quarter. Since I've been contributing to a Roth and prefer to do things monthly, I figured I'd increase my retirement contributions $10/mo per month. This triggered a shift in mentality, where suddenly $10/mo was a real, meaningful about to contribute. Instead of staring down my colossal ultimate retirement goal, my goal was to get to 7% contribution, then 8%. I largely ignored the scary retirement calculators, and when I used them it was more for a compass than for actual real time instructions. I got a job that paid more and had better retirement benefits, cut expenses, and today, I signed paperwork to contribute 16% of my pre-tax income to my retirement! I'm not done yet- I started contributing late, so I have some catching up to do, but just passing the 15% mark has been huge!!!
Michelle: This is a huge win for you. The retirement account is going to snowball for you. I don’t even know you and I’m proud of you!
33:42 “to value cash flow over cash” i.e. investing in ‘cash flow’
I also find it’s the ‘circle of life’; if you get to fully fund true expense categories ahead of time (which frees up cash flow), those fully funded true expenses also stops you stealing from future cash flow (like if you have car repairs)! 😳
It’s a thing of beauty when this becomes part of your budgeting DNA.
Yes! My husband fixed our dryer himself a few months ago, and it started making funny noises the other day. I decided that instead of worrying about when it was going to break again, I would add a Dryer category to our budget. Woohoo! We're 1/3 of the way to a new dryer if the old one breaks, or solidly covered for parts. Other categories took a hit, but I'm not worried when I turn the dryer on now. Happy tradeoff.
Regarding rule 2 and trading a lot of pain later for a little pain now. It's true, as a new YNABer, seeing the number of "true expense" categories grow as I think of things to add to my budget is painful as I worry about funding them all, but seeing the even partially funded brings peace of mind as well. As I listened to you guys talk about the pain of rule 2 I realized how important it was that such a powerful word as EMBRACE is used for it. Not remember, not consider, not make note, Embrace. I think that has gone a long way in keeping the importance of that rule in mind.
Ben said the magic word 36 minutes in - "margin" - that is the key to almost everything in life, but especially financial success. The only way to get out of the paycheck to paycheck cycle is to create margin that then allows you to set up an emergency fund, prepare for true expenses, etc. As time goes by it is the increased margin that enables investing, saving for retirement, and building the life you want. Easy concept, hard practice. That to me was the true value of YNAB - it gave me a microscope to examine where additional margin could be created each month.
YNAB win? After five years, I thought I was a full-fledged wine hamburger (not a cult), but this episode tripped another tumbler toward completely unlocking the YNAB mindset. I have been a month ahead for a while now and I’m in the “put the Ready-to-Assign money directly into the next month” camp. But then, as I needed to be implementing Rule 3, I would mosey over to that next month and just roll those punches right back into the current month. I never had to feel the immediate pain of actually making a tradeoff and “Future Me” literally paid the price.
The moment when you said that you “...only pull money from a category that was funded that month…to avoid eating away at the future,” you got me to see Rule 3 the proper way - and it is making a huge difference!
Thank you Budget Nerds! From now on it’s Rule 3 FOR REAL and no more stealing from “Future Me!” #YNABWin
I looove this, John! You're so right, it makes Rule 3 even more real. Keep it up my friend! ~BenB
I’d say lice definitely counts as an emergency expense. You gave that money a job to be there for emergencies, so you don’t have to delay moving money in a pinch. You’ll refill it when the priority to save comes back, after the emergency is over.
Finally catching up on videos, and I had a similar issue with Home Depot and a washer/dryer! I think blood feud is a good way to describe it. But I did get the delivery fee refunded so I guess that's a small YNAB win ;)
I'm so glad I was wrong about the floor! I still bet you're going to see a difference in your electric bill. Congratulations on the new fridge. Love the show.
Yes! I think that old fridge was sucking up a lot of energy cause it just had to work so hard to keep going. Happy to report the fridge is safely in my kitchen now. :) ~BenB
You would have to rank each grocery item in order of importance and then only buy what your budget would allow. Very difficult.
Actually, grocery items can be rated in order of importance sometimes. Like, proteins above candies, toilet paper over treats :)
That's the reality for many of us. It's not difficult- it's the usual process for shopping.
Any tips for when you transfer money from PayPal to a regular account and you pay for that quick transaction fee, and
how to ensure that that translates over the transfer without it affecting your financial budget? recently been using the quick transfer for emergency purposes when my card was in the mail for PayPal and the cost differential between the transfers were off by like a couple dollars or less and it wasn't linking the two transactions as one transaction causing for a discrepancy in like a couple hundred dollars from the multiple transactions.
Ex: $203 was transferred from PayPal to Chase checking and of the $203, $1.30 was a transaction fee to the transfer amount that actually enters the chase checking is only $201.70 so the transfer and the inflow don't link and you can't apply an additional category to that one transaction to show the 1.30 was a cost associated with transfer.
Wow, Amazon just did the same thing to me that Paramount Plus did. We're seeing if Prime is worth paying for to us and taking a break. Literally just cancelled the subscription, went to order something, and they offered a free month of Prime 😂
🤣🤣🤣 ~Ernie
Thanx for reinforcing how mental budgeting is. Love your show
I just had to replace our home warranty service because our house has slowly crumbled down around is because of poor previous ownership and I would rather haggle and pay a yearly price with a deductible to have someone come fix our house rather than find someone on our own and pay a lot more.
But I am someone who will price match things and kvetch until I get what I feel is a good price so it offsets the cost in my mind.
My dog also just had surgery for miscalculating his escape and I know the cost will be reimbursed with surgery and can be plopped right back in the 'pet emergency fund'.
I hope YNAB the company is doing good budgeting because I need to be using this software for the rest of my life.
omg same
The frig from Hell. I hear the water heater making funny noises.
Don't even say it, Vincent! 🙈 ~BenB
For me if I am going to get a bonus, first thing I think about is to budget 10% of the amount to tithing
I have a retired friend who had a part time job at Enterprise car rentals. One of his duties was cleaning out rental cars, and often he found loose change. He'd collect a jar full, have it counted at his bank, and dutifully tithe 10 percent of the amount to his church.
The cash slow thing is such a great idea! I’m definitely usually that mindset from now on
Question: If a budget is considered to be an estimate of income and expenditure over a set period of time then how is it that one could experience a possible financial collaspe unless they have not accounted for inflation etc throughout the budget prior to using set budget as a blueprint to further navigate them throughout the hour, day, week, month, quarter, and year which in turn means that its very possible that one may not be either properly utilizing the budget or using the right budgeting system in general.
Do you use YNAB?
@@vincentapa1376 No I analyze the market and forecast how to create a budget based on any data gathered prior to creating a budget that in which will align with how much funding is availible to further invest towards securing any short or long-term investment listed throughout my budget which by the way is considered a investment portfolio which in extension is considered the beginning stages of investing.
@@hierarchyfinancebureau1369 I'm confused- why you are here? Because you don't sound as though you actually use a budget. If people knew everything in life, yes, they could plan for every contingency. (BORING, by the way) Since I don't have a crystal ball I budget and save for emergency expenditures. The more I plan for emergencies, they less likely I am to have to use my emergency fund- because I've planned for them- they are no longer an emergency. Like I asked before, what is it you are searching for here- clients?
@@summitseeker2333 Well my dear don’t be confused I’m here to learn which is why humans have been created therefore I gather information regarding my field of study to create strategies that in which will not only grant myself a greater understanding of the subject but others as well I don’t take the easy way out I actually do the work and don’t make excuses about why I don’t understand what it is that I desire from life…in extension to carrying out the task assigned to me by the lord so please don’t be confused get educated…. any more questions
@@summitseeker2333 Based on the way you’ve responded I can detect that you don’t understand the mind of an educator because if you did you would never discourage a student (learner) from making an observation or asking a question to the teacher (educator) therefore maybe you shouldn’t be here and by the way I can detect that you do surface level work which is why it’s boring to you may not be that way for others just for future reference dear.
Question: Why would one have to trade anything throughout their budget if they have properly distributed any revenue generated throughout the year towards anything in life that in which they desire unless the budget in itself is causing friction in regard to them actually learning how to make wise investments over the entire duration of their financial journey which in turn should secure all things desired?
I want a new TV that's worth $500, I receive a paycheck for $1000 but have $1000 of bills whether it's housing, utilities, groceries... I have to trade off that new TV until I can work it into my budget.. I'd rather my pets have food than a brand new TV and that's the trade off
@@jena.t The idea should be to secure as much of the life we desire to live based on the amount of funding one has available which in turn is the true purpose of a budget.
@@hierarchyfinancebureau1369 That's the idea! Doesn't always happen like that. Life isn't perfect.
@@jena.t I understand...but in reality it should be due to making a plan for your money and if you do that it could be near perfect...
I'm like Ernie now that my debt isn't such a big part of life. The company I work for just went from public to private, causing a small windfall of my stock being cashed out. Still trying to figure out just what I want those dollars to do 🫠