Changing the mindset

So the hardest part of this whole YNAB thing is changing the mindset. I've mentioned this before but it's really coming up in the last few days and I feel the need to talk it out. So it is just so hard to come to terms with 'being broke' when there is money in the account. For that matter, it's hard to come to terms with the budget when it doesn't seem to match with the bank accounts. Let me explain:

Here is what my budget looks like:

This is just a piece of my budget. Notice the various categories I have, like Kindle Unlimited, HP Ink, and Bulwark. Notice also that some are orange, some are green, and some are red. The green means that I have money put aside for this bill but haven't spent it yet. The orange means that I have a bill coming up but haven't put any money aside for it. The red means that I spent money that I haven't budgeted for. So the medical and the stuff for school have not been budgeted for so they will show up in red until I 'cover' them from somewhere. The grey means that I have budgeted for it and spent it ao it's all good. The disconnect in my head happens because of this. I have not budgeted that money, but I have the money in my account to cover it.  I know logically that I have given some money other jobs and that is why I don't have the budget to cover this, but it just is not completely clicking in my head. The real problem is that I won't ever completely buy into this until it clicks in my head. Once I can wrap my mind around exactly what is happening, then I truly will be all in. Right now, I'm going through the motions but not completely buying into this. I need some lightning bolt to hit me and make everything crystal clear. And now as I'm typing this it is starting to make more sense. I don't have the 'budget' to cover this payment and the only way I can cover it is to move money that I have set aside for something else. So it's like virtual envelopes. I put some money in the car insurance envelope but may need to take it because I don't have enough in the medical envelope. Oh my god, I think I'm getting it.

This is just like what we do every payday. We pull out $300 in cash and split it up into envelopes. Groceries get $200, Charlie gets $60, and I get $40. That's what we have until next payday. If the grocery money runs short, then Charlie will take some of his own money to cover it. So we don't look at the total amount we have, $300, we look at what is available in each envelope. So if I have $40, I can spend $40 but if I only have $20, that's all I have. OMG!!! I feel like such an idiot. It took me so long to get this. So now I have to move things around between 'envelopes' to cover this and then I will have to refill the envelopes tomorrow when we get paid. Okay, so if I'm going to pay something that I don't have an envelope for, I need to move the money from one of the other envelopes to cover it. I then have to make sure to refill that envelope when I get more money. Okay, I can live with this now - I think. Sometimes I just have to 'talk' it through to really get it in my head.

More successes with money

After my post on Sunday, I was trying to figure out what to do with the money we had gotten when the Hubby reminded me of an outstanding tax bill from Hawaii. We left Hawaii 3 years ago and the final year we ended up owing taxes. It was $700 and while I hated to pay it, it felt nice to have it taken care of and out of the way. Then last night I remembered we had a $500 bill from the dentist, so I paid that too. I hated the fact that I used almost all of our windfall on bills, but I was super excited that I hadn't blown the money and still had it to pay the bills.

I think back on the way I used to think and it just kind of boggles my mind. In the past, I would have gotten that money, $1300, and would have started planning what I could spend it on. I would have wanted to blow it on useless stuff (much of which I have laying around my house) and wasted it. This time was very different. I did want to purchase some agility equipment but rather than basing it on how quickly I could get it, I based it on what I actually wanted, what would work for our set up, and price. Not necessarily the cheapest but the best value for the price. So I did that and I am very proud of myself. I could have spent almost $200 on the few pieces that I wanted. Instead, I spent <$100 and will make some of it myself. I'm excited. And I'm proud of myself. Instead of going off and buying things on a whim, I really put some thought into it. Something that I didn't use to do.

On the note of buying things on a whim, I have a number of things around my house that I bought and do not use. Over the summer I'm either going to sell them or start using them. I'm thinking of the 2 little printers I have. One I got at a garage sale for $5 the other I paid almost $100 for and they both work pretty much the same. So maybe I'll sell one for $50. Or I'll come up with a good way to use them. I also have a photo negative scanner that I'm going to use this summer. One of my projects is to get those negatives scanned and decide what to do with the pictures. I'll probably have books made for the kids and us, but I'll see. The summer will be spent using the things I have and not buying new things. Between my new mindset and my new attitude toward money, I'm looking forward to the summer.

WAMing

There is a term in the YNAB community - WAM.  It loosely stands for whack a mole, but really means that when unexpected expenses pop up you move money around to cover it. It's good in that it teaches you to be flexible with your money, unlike some other budgeting programs. So it's good......but.... 

I have been using YNAB almost 5 months now. And overall it's been an amazing experience. I finally feel like I have a really firm handle on our money. I finally feel like I know what I'm doing with our money. I really love it. I have not had an NSF in 4-5 months. That is amazing. Also, I have not had to sweat the last few days until payday in a long time. That is amazing too. To know with absolute certainty that there is money there and it's not going anywhere. I love it. But........

Things keep coming up. Things I didn't necessarily account for...or think about....or consider. And it's starting to drive me crazy. For example, I have a whole budget category set up for the dogs. In there are treats for them, pills they need, Mavys class fees, all things like that. I have them broken into separate categories even. And I think that's where the problem arises, but I don't want to get ahead of myself.  Here is what my dog category looks like:

As you can see, I have individual medications broken out for Bella and Lola, which I just realized I can combine into one category since they get them at the same time - every other month. Then I have the Amazon supplements that we get every month. The CBD oil which I'm not sure I can continue since it is so expensive and I go through a bottle every week and a half. Then I have Mavy's agility classes and his treats from Chewy, then the wellness plans for all 3, and finally the RunBuddy for Bella. When I break it up this way I need a category for everything that happens to them. Maybe I should just have a Bella, Lola, and Mavy category and calculate what they need each month and then fund that. Because this week I ordered Mavy some agility equipment and there is no category for that so where does it go? Also, he will be taking an extra agility class over the summer, where does that go? I think trying to be too detailed is going to kill me. I like details, but I also like things to be easy.

Maybe it's time to rethink and retool the budget again. I don't want to do a fresh start - again - but I'm not liking the categories and I hate having to keep adding categories especially for one time things. Time to think about this.

Well that didn't go as planned

In my last post, I talked about how I was going all in and really going to make April awesome as far as budgeting goes. I was going to end the month with over $500 and things were going to be amazing. Yeah, that didn't happen. I ended it with $110 in the bank. Now that is good but I did have to put off one bill until today because I didn't have the money. And I'm depressed because I don't have any money. I gave all my money a job and now have nothing left. That is sad.

I'm wondering how to change this mindset. I have money set aside for things that will be coming up, so that's all good. But how do I lose this feeling of having no money?  Is it because I know where every dollar has to go and therefore I can't just blow it? I've done that often enough and I don't like that feeling so I guess I should be happy. But I feel like I'm broke because there isn't any money just sitting there waiting for me to blow it. I guess that is truly what they mean by YNAB broke.

The good news is that we have refinanced yet again and that will be closing in a couple of days. That means that no mortgage payment next month. I want to use that to get ahead a little bit. I want to get some things funded - like auto insurance - and then try to get ahead a little. Get the bills paid before they are due and have money to budget into next month.

I guess I see now how things can be and I'm just anxious to get there. I will have the mortgage payment to play with and I should be getting my tax return so I'll have that also. That will be about $2600 to use to get ahead. I'm really looking forward to that.

I never was a patient person......

I'm going all in

I made it to payday without anything bouncing. I actually had $78 left in the bank. I sat this afternoon (when I should have been working) and revamped my budget. I started a whole new one with all the categories I need. I put in some that will cover the car registration next year and our car insurance premium in full in 6 months. I have categories for fun money for each of us as well as vacation and savings. This is what my budget looks like:

I think I have included everything that happens in our month. I have the dog's supplements and treats. I have their wellness plan. I have the pest control which happens every other month, so I split the cost between 2 months. I am fairly certain I have everything covered. That's kind of what I used the last 2 months for, finding all the expenses that happen and I forget about. So I think I'm good with the budget.

Then I sat and entered all the recurring transactions into the check register. By making them recurring, I not only keep track of what is coming up so I don't miss a bill, but I can project what the money will be as the month progresses. Here is what April looks like:

It's hard to see, but if you look at the end of April (the top) you will see that we will end the month with $528 left over. What you don't see, because it's not there, is there is another paycheck before the end of April. It shows the paycheck on the 11th, but it doesn't show the paycheck on the 25th. That means we are going to be ending April with almost $2500 extra. Say what???????  Now, as far as I know, we have no major bills or expenses coming up in April so this should be true. In fact, most of the time when I've projected it's been fairly accurate. So I believe this may well happen. This means that by the end of May we may be a full month buffered. We get some bonus money when school ends and that will only help the situation. I am trying not to get excited, but OMG!!!!!!  Could this actually work? Is it possible to stop living paycheck to paycheck?  I am cautiously optimistic about this whole thing. I just need to keep myself in check and not go on a spending spree because there is money in the bank.

I have cut ties with Netflix, Sling, and Hulu. I no longer have any of that. We are using strictly cable streaming. It was a little rough getting started, but I think we have worked the kinks out. I like it because my one TV didn't get Sling - at least not well - and I really like watching Travel Channel or the History Channel.

I think the real goal here is to be mindful of the money. We lived for so long on autopilot. Bills would come in and we had no money to pay them. Payday would come and we would pay those bills and then be broke until next payday. Rinse, repeat endlessly.  I don't want to live like that. I want to have enough buffer in the account so that I can set all bills on autopay and forget it. I want to not have to worry about money and how much we have. I think we are going to be able to do this. I really and truly do.

Saving more money

Continuing yesterday's theme...  I cut my Sprint bill by $30 but I will have to pay about $10 for Hulu, so really only cut it by $20. Then went and turned off the sports on Sling since football is over and cut that by $10.00. So I was at a $30/month savings. Not earth shattering but good.

Then, as I'm leaving work yesterday, I get a call from a number I don't know but I answered it anyway (rare for me).  It was Cox offering me a streaming deal. I currently have my internet through Cox and it's about $120/month. Add to that Sling, $44 (new price),  Netflix, $1150 and going up I believe,  plus the new Hulu charges, $10, and I was paying about $185.50/month for TV. And we have to switch between different things to watch different things. So we go on the antenna for local TV, the Fire Stick for Sling, etc. It can get annoying. And we don't get all the channels with the antenna, at least not in all the rooms of the house. The deal with Cox is I get internet, streaming TV of over 200 channels, including all the local stuff, for $165/month.  A savings of about $20. Add that to my now savings of $30 with Sprint and I'm at $50 a month. Not bad. Plus, I don't have to remember to pay 4 different things, it's all in one place. So I'm kind of proud of myself. We'll see how it goes. We have a month to cancel and there is no contract so technically we can cancel anytime. If we don't like it we'll just go back to Sling/Netflix/Hulu.

I think the important part here is to realize that just because that's what's been done, we don't have to continue to do it that way. I can look around and change things if I can find a better way. So the real success is being open to change and looking for new and different ways to cut expenses.

The road is never straight

While this is true for many, if not most, things in life, it is especially true for me trying to get financially right. I started off with, I'm going to pay $800 a month towards my debt and get out of debt in 16 months. Then it became, I'm going to pay $100 a month and not create any more debt and get out of debt in 2 years. Now it's like, I'm just trying to keep my head above water here......

It's been a rough couple of months since I started YNAB and while I know it's not YNAB's fault, I can't help but wonder what it would be like if I hadn't started YNAB. So let's recap:

December - started YNAB mid-December with the goal of paying off all debt in about 16 months
January - went well with YNAB, realized that debt payment was too aggressive and needed to scale it back a bit.
February - the wheels came off the bus. I overspent significantly and spent the rest of the month trying to recover.
March - some bills came due that while not unexpected, I didn't really have the money to cover and now we are really, really tight.

This experience can't help but make me wonder a couple of things. First, are we living beyond our means? Do we need to scale back in some areas, somehow? Second, is my spending that out of control that I throw the budget out of whack every month? Third, when will I get a true handle on our budget and have things covered as they need to be covered?

I was thinking about contacting Sprint and seeing if there is any way to cut our bill there. That bill is $225 a month.  If I could get that below $200 I would be excited.

I just got off a chat with Sprint and was successful. I got my bill below $200 so that's all good. I now have to pay for Hulu again, but I'm good with that. I also just changed my Sling subscription since football is over there is no need for the Sports Extra package anymore. So I'm down about $50 a month so far. Yay me.