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Something I've been meaning to post about that I keep avoiding, but that I want to tackle is a bit of a review of a product I've been using lately.

It is an online budgeting system called You Need A Budget or YNAB. It is a structure and a mindset to go about building and maintaining a budget and really to be more definitively aware of how you spend money and how to keep track of how and where it goes, and to use that information to make informed decisions about spending.

I seems like lots of people are in different places when it comes to money, and for me, my place involves some debt, a regular income, bills that are mostly manageable, and a tendency to not be mindful of any leftovers that come around. For me, this particular budgeting solution seems to work really well, and I've found some good successes in planning ahead.

I think the ultimate goal for budgeting is not just to make it month to month. It is to plan ahead if you can. If you aren't making enough to make ends meet, that is definitely one issue, but if your discretionary spending is really what is contributing to this problem or holding you back from moving forward financially, a budget is a good idea.

YNAB builds on various core principles of money. Firstly is the idea of giving every dollar a job. Account for every single penny in your possession and continue to lay out the specifics about what every dollar of every paycheck or income does as it comes. That means being intentional about your spending. It also means being mindful of your habitual spending. Notice I said mindful and not restrictive. Budgets don't have to be limiting. They just need to be accurate and mindful.

The next idea is becoming very aware of your expected expenses as they relate to how money arrives. In your goal to give money a job, account for the expenses you have before you get paid again, and set that money aside. Learn your expenses.. not just the ones coming in a couple weeks, but the other ones that maybe only happen once a quarter or once a year. Begin to think of them in the now and set a little aside to work up to them. There are really nice money goal features that allow you to set times and amounts for your expenses to help encourage you and to track your progress on your savings goals be they for an upcoming tax bill or even a day trip away.

Next, understand that budgets are not immovable things in stone. Expenses change month to month and your budget should change to reflect it. If you went to a movie this month and you normally don't, if you didn't budget for it originally, you need to now and you'll need to shuffle around your budget allocations to accommodate it. Maybe it means that the extra money you were putting aside for a new set of tires doesn't get as much as you normally put aside. It follows the common sense idea that you wanted to spend it, so since you kept track and gave every dollar a job already, you need to change those jobs a little. Working through THIS process helps you see where your financial priorities are. Maybe your priorities are having a latte in the mornings. Or maybe it is putting extra money aside to help pay off your school loan. Either way, you'll learn those priorities, and with the visibility that YNAB provides, it is in this process that you can learn to adjust if you want. Or not. It's all up to you.

Finally, the last concept is to age your money. The example they give, and one that I like, is the idea of the grain silo. If you think of your income as grain, it enters the top of the silo. What you spend you pull from the bottom of the silo. The goal is to make sure that grain stays in the silo as long as possible. If you pull out grain faster than you replace it, that is obviously not good. And if you are pulling it out at the same rate, that isn't necessarily good either. It doesn't give you a future place to work from. The program also mentions that really, you don't want your income to sit for years at a time outside of a specific investment either. Your money should have a job whether it is saving for future expenses or even planning for fun things. As you age your money, you find you have extra to push ahead for future expenses and can start feeling some of that financial breathing room. As you go along and account your income and your expenses in the software, it makes calculations as to how you're doing, and it displays the "age" of your money.

I've been using the system for several months now, and I find that it helps me be mindful of my spending, and it still gives me the freedom to spend the way I want to spend. One of the other things that this system stresses is to stop using consumer credit and to instead work at planning ahead for those sorts of expenses. I've found personally that as I've continued to work with the system and change my spending habits, my need for credit has become less and less. I find myself paying for things in cash in a way I never imagined I could.

To be clear, budgeting is not easy work. It involves updates and adjustments constantly. It is definitely a commitment not only to time but to working with the process. I am finding that for me, the system helps a lot and I'm seeing some very tangible results that make my commitment worth the effort.

YNAB is probably not for everybody, and if you have a system in place that already keeps you intimately aware of your spending and your savings goals, you probably don't need this. But if you've been looking for a structure to start with, and don't mind putting in the time and effort, I'd say YNAB is a great product and worth not only the money (a small monthly fee) but also the effort involved in following it and reaping the associated rewards.

You can find YNAB at and the first month is free!

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