You Need A Budget (ynab)

A listener writes Jesse to ask what he should do with his first real job and first real paycheck -- pay off debt, or start investing? This is a popular question with a few answers, and in Jesse's mind, the answers are all valid! What matters most is where you picture your life five years from now, whether you are happy with that picture, and whether your current trajectory is going to get you there.   Some people get a lot of satisfaction from having a big nest egg, even while carrying debt. Others prize the freedom they feel from not having debt more than the size of their investment accounts. And of course, some people prefer to be somewhere in between.   Got a question for Jesse? Send him an email: askjesse@ynab.com   Sign up for a free 34-day trial of YNAB at www.youneedabudget.com

There's a moment that happens when you run across something you really want -- it's like an itch that wants you to whip out the credit card and scratch it! In these moments, we're probably not very clear on our priorities and Rule One, so Jesse reminds us that the budget is the thing that helps us answer the question: can I afford this? Am I going to be OK after I buy this? And the budget answers those questions for you by bringing clarity to your priorities and the jobs you have assigned to your dollars.   Got a question for Jesse? Send him an email: askjesse@ynab.com   Sign up for a free 34-day trial of YNAB at www.youneedabudget.com

Hillary writes into the show to ask: when you started giving an allowance to your kids, what things did they buy that made you cringe? Hillary is starting the YNAB allowance strategy for her kids, aged 16, 15, and 12, and is wondering how to teach them to spend the money responsibly. Jesse offers his experiences with his own kids, and some of the money lessons he has watched them learn in their own life.   Want to ask Jesse a question? Send him an email at: askjesse@ynab.com   Sign up for a free 34-day trial of YNAB at www.youneedabudget.com

Jesse chats with a number of YNAB employees who are living, or working towards living, a "nomadic" life -- living and working across the US in a variety of places throughout the year. While this type of lifestyle can create some amazing freedoms (Megan, for instance, arranges her work schedule so that she can spend her mornings skiing during the winter), it also requires a lot of careful planning! That's where YNAB comes in.   Maintaining a trailer, motorhome, or RV and handling the costs of living in new places involves lots of planning around true expenses and rolling with the punches. The nomadic ladies of YNAB share their experiences shifting to an unconventional lifestyle, and how the budgeting lessons they learned from the Four Rules have helped them make it happen.   Bringing budgeting into the workplace -- Financial Wellness by YNAB. https://www.youneedabudget.com/wellness/   Email Jesse your stories about YNAB in the workplace: askjesse@ynab.com

A listener writes into the show to ask about whole life insurance and whether it's worth it for a young couple in their 30's. As always, it depends!  Whole life policies typically come with big fees, which of course insurance companies and salesmen like. Jesse points out that the policies can work for some people in high marginal tax brackets, however the tax savings must be carefully weighed against the earnings you could have made by simply investing in low-cost, diversified index funds and sidestepping the high fees of whole life policies.   Send Jesse an email at: askjesse@ynab.com   Sign up for a free 34-day trial of YNAB at www.youneedabudget.com

Happy Fourth of July to the American YNAB'ers out there!   Following Apple's recent announcement of their "Apple Pay Later" plan, in which customers can split the cost of purchases over multiple installments using Apple Pay, Jesse rants about the state of financing among successful companies. As he has noted before, nearly all successful companies eventually become finance companies, and Apple is no exception.   Buy now, pay later (BNPL) plans may be good for Apple's bottom line, but they are bad news for consumers. Research has discovered that people tend to buy 40% more with BNPL plans than they would have with cash. Then of course there is the interest and penalties that come with missed payments. Jesse has a bone to pick with this...   Send Jesse an email at: askjesse@ynab.com   Sign up for a free 34-day trial of YNAB at www.youneedabudget.com

It's no surprise, but employees carry their money stress into work with them. And that stress not only affects their performance at work, it affects their happiness and, by extension, increases turnover.    Jesse shares results from a survey of over 3,000 YNAB'ers in the US who work full-time jobs in a variety of age ranges and income levels. YNAB found that only 24% of YNAB users experienced financial distress over the past two years of pandemic-fueled chaos -- pretty amazing compared to a broader survey of American workers by PWC which reported 63% experiencing financial distress. Another interesting stat: 93% of YNAB'ers reported being able to cover a $1,000 emergency expense, compared to just 13% of the PWC survey respondents. YNAB is clearly a powerful tool for financial stability!   Now, YNAB is helping to bring budgeting into the workplace with Financial Wellness by YNAB. https://www.youneedabudget.com/wellness/   Email Jesse your stories about YNAB in the workplace: askjesse@ynab.com  

Britney writes into the show to ask, as a long time fan and follower of various personal finance resources, what should she do now that her family's budget is pretty much dialed in? How can she avoid constantly looking at the app to check that the budget is still working?   Jesse reminds us that budgeting should, eventually, become boring for everyone. It may not be the goal, but it's at least a hallmark of a succesful budgeting practice! After that, maybe it's time to find a new hobby...   Antifragile: Things That Gain from Disorder by Nassim Taleb https://www.amazon.com/Antifragile-Things-That-Disorder-Incerto/dp/0812979680   Send Jesse an email at: askjesse@ynab.com   Sign up for a free 34-day trial of YNAB at www.youneedabudget.com

It's right about the mid-point of the year... how's your budget doing? Are you still clear on your priorities, and what jobs your dollars should be doing for you? If you've found yourself Rule Three'ing everything and rolling with the punches month after month, perhaps it is time to revisit your goals, reevaluate your priorities, and revise your budget accordingly.   Send Jesse an email at: askjesse@ynab.com   Sign up for a free 34-day trial of YNAB at www.youneedabudget.com

A listener writes into the show -- what should she do with her investments in this market? Each week she is seeing the value of her portfolio go down, and she is losing as much value as what she puts in each month. Ouch! Jesse reminds us not to panic, and to go back to your written investment plan (you have one of those, right?).   Why are you investing in the first place? What is your time horizon? Do you think the economy will grow in the (long-term) future? If yes -- and this has been historically true over a long time horizon -- then a broad market index will also grow over the long run, and sticking to your investment plan is the thing to do.   Jesse has another recommendation: look at the number of shares you own, not the value of those shares on paper. If your number of shares is going up, then your portfolio is still growing by an important metric!   Investing books mentioned in the show: The Little Book of Common Sense Investing by Jack Bogle A Random Walk Down Wall Street by Burton Malkiel The B

On a recent Budget Nerds episode, Jesse threw out a hot take that index investing isn't all it's cracked up to be. Jocelyn wrote into the show to ask... why exactly? Jesse explains himself in today's episode.   Investing Books mentioned in the show: The Little Book of Common Sense Investing by Jack Bogle A Random Walk Down Wall Street by Burton Malkiel The Bogleheads Guide to Investing The Four Pillars of Investing by Bernstein  

As inflation continues to rear it's ugly head in 2022, prices are going up and up, meaning budgets are getting stretched thin. Inflation is essentially another form of scarcity, Jesse points out, albeit involuntary scarcity. Jesse reminds us that scarcity is what drives us to be creative with the budget, and get more clear about our values.   Budgeting is also an active process, so this time of inflation is a good time to dig deeper into every category, find the things that are auto-pilot and re-evaluate whether they shoud continue to be so. By exercising your Four Rules muscles, you can stay positive and confident about your financial strategy even when economic prospects are alarming.   Send Jesse an email at: askjesse@ynab.com   Sign up for a free 34-day trial of YNAB at www.youneedabudget.com

A listener writes into the show to ask: how should you track vacation spending? Vacation is a time to relax and let loose a little, but the listener wants to make sure he is pacing the family's expenses during the trip so he doesn't go overbudget.   Jesse offers a few different options, including sophisticated use of categories to track the vacation spend without creating too much complexity.   Have a question for Jesse? Send him an email at: askjesse@ynab.com   Sign up for a free 34-day trial of YNAB at www.youneedabudget.com

Kelly Frawley and Emily Pollock are attorneys specializing in matrimonial and family law, and regularly contribute to Forbes on issues related to divorce and business. In today's episode, they discuss the important questions you should be asking before marriage about money, finances, and expectations about the future. And, in the event of divorce, some of the important things you should be doing and asking during the process.   Both Kelly and Emily agree that the most important thing couples can do before and during their marriage is communicate. Whether it's about debt and how you intend to pay it off, expectations about lifestyle and living expenses, plans for retirement -- if you keep communication frequent and open, then you will feel more certainty and security about your money.   Kelly and Emily on Forbes: https://www.forbes.com/sites/frawleypollock/?sh=1c25b3d6eb04   Kelly Frawley: https://www.kasowitz.com/people/kelly-a-frawley Emily Pollock: https://www.kasowitz.com/people/all/emily-s-pollock/   Sign

Struggling with YNAB? That's OK, you're not alone, and Jesse has a few things to look at and make sure you are truly following the Four Rules. And along the way, Jesse has a bone to pick about banks and their data export practices!   Sign up for a free 34-day trial of YNAB at www.youneedabudget.com

A first-time house shopper wrote into the show for advice on how to approach the crazy, red hot housing market we are currently in. The writer wants to buy her first home, but is unsure whether she will have enough money to put down as house prices rise at a rapid pace. Jesse reminds us that, most importantly, cash equals options, and it's never a bad thing to have more cash on hand. He advises her to become an expert on her local real estate market, and really think about why she wants to buy, and what exactly she needs from a home before taking the plunge into home ownership.   Sign up for a free 34-day trial of YNAB at www.youneedabudget.com

Jesse shares some case studies from the Mecham household, where he has taught his kids to budget their savings the YNAB way, giving those savings dollars a job. The kicker? Their savings sit in the same checking account as their fun money. With practice and the four rules, however, they have developed the discipline to spend only what they have budgeted for each purpose.   Sign up for a free 34-day trial of YNAB at www.youneedabudget.com

Jesse welcomes Jason and Katie Hoschouer to the podcast. Together they paid off $78,000 of debt in a mere 28 months, an amazing burst of focused saving and budgeting!   Jason is a retired police officer with 23-years experience in the force, now turned financial coach. He helps other first responders get their budgets in order, pay off debt, and build savings so they don't have to live paycheck to paycheck and work tons of overtime to make ends meet. He also hosts a podcast about finance for first responders, Badges & Budgets.   GPS Financial Coaching https://www.gpsfinancialcoaching.com   Badges & Budgets Podcast Apple: https://podcasts.apple.com/us/podcast/badges-budgets/id1611201890 Spotify: https://open.spotify.com/show/4vcWckWJibgAaRSyY5o8bu?si=15e96a154eaf44d7  

Jesse invites the CEO of YNAB, Todd Curtis, to the show to discuss the anatomy of the company, the collaborative philosophy behind the work done by the various teams and functions, and some of the previous work and experiences that have shaped Todd's attitudes about operations and business culture.   Sign up for a free 34-day trial of YNAB at www.youneedabudget.com

Nina Clark grew up in a large family tight on money, but with a mother who was very good at budgeting and stretching a dollar. Nevertheless, she wasn't taught anything about money growing up, so she learned her money lessons the hard way: overdrafting her checking account and racking up debt at a young age. Things got more complicated when she went through a divorce and became a single mother. Ever determined and positive, Nina regained her financial footing and became a seasoned budgeter with a little help from YNAB.   Nina's story is also unique in that she's never worked conventional jobs, and never made much money, so she had to budget carefully to pay off her debts. While working various jobs, she started a bookkeeping service to supplement her income, throw extra cash at her debt each time she landed a new client. Nowadays, Nina's budget is helping her save for retirement, travel, and help her daughter travel the world as well.   Sign up for a free 34-day trial of YNAB at www.youneedabudget.com