I just saw Avengers: Endgame, which I feel like I can’t talk about yet, so instead I thought I’d come back to this entry that I started writing oh, hey, six months ago.
This is another entry in which I take inspiration from John Scalzi, on his blog Whatever, as he continues his twenty-year retrospective of blog writing. He is on day 26. I am on day 2. At this rate, I’ll be able to keep bouncing back to his blog until the end of the year. Up today: Money! And how I have none of it! (Well I do have some and I’m insanely lucky in some ways and I suppose we’ll get to that.) So far Scalzi has blogged about cats and money, two things that I don’t have any of.
I grew up in a house that always had enough money, enough food, Christmas presents under the tree. I’m fairly certain that my parents never had to worry about having enough money for Christmas, though they didn’t exactly go wild with materialism either. They were and are very deliberate with their money, something I’ve only come to realize in hindsight and observe as an adult. Like Christmas and birthday presents were always a thing, but cable TV? Never a thing. We never had cable television in my house. We only had dial up internet until after I moved out. But that had less to do than my parents not being able to afford it than it did my parents not wanting to spend money on garbage. We could go on a trip every year. My parents have their retirement worked out. My dad pays off his credit card bill every month. Whatever long term plan the books tell you to follow to financial security, my parents followed it.
And then they raised me, and I had no idea what the hell to do with money until well past age 30. Osmosis and environment didn’t do the job there. Part of it is just that I barely ever had any money of my own. In elementary school I got $1.25 a week in allowance, and even though this was the early 90s, it was still below average for my classmates. In middle school I got $5. The last couple years of high school I got $20, but I was responsible for buying my own lunches at school, which ate most of it (I never did what would’ve been the smart thing and made my lunch while still pocketing the $20). I think I was a junior when I got my first retail job, and I worked all through college, but after college I never quite transitioned from retail/coffee shop jobs into “professional” jobs. I just kept coffee shopping. For most of my twenties I probably earned between $20-$25k a year. I had roommates, I had a landlord who was happy to rent their space to us for below market value for some reason, I never went to the doctor, I didn’t own a car. But still, every dollar I made was basically spent the minute it landed it my account. I never learned to budget, never learned to not splurge. If you know you’re going to be running out of money anyway, why not just spend it on something that’s fun? If you have to buy food, why not buy hummus instead of beans and rice?
Could I have been thriftier? Sure. But I also had a fundamental income problem. I was earning like $9/hr and had no health insurance. (I think this is a really common millennial dilemma, by the way: Not being able to figure out where your own mistakes end and the shitty system you find yourself in begins.)
In 2010, I made the dumb decision to go back to school. Dumb because I had no way to pay for it, so I took out loans and asked my parents to help me, and they did because education is basically the one thing they’ll always help pay for. This led to my dad discovering exactly how bad I was with money, how much I don’t keep track of it, how much of his I was spending, how little of it I could account for it. I remember him shoving a paper copy of his budget/yearly planned expenditures in my face in frustration, asking Why the hell I couldn’t just do this. What was so hard about this?! And I felt so dumb. So, so so stupid. It took a couple years before I realized, wait, where the hell did he think I was supposed to learn this? When was the budgeting 101 conversation supposed to happen? Should he have taught it to me? Should I have learned it from school? Should I have gotten a book out of the library? Like I’m sorry I’m a dummy and I’m sorry I didn’t take steps to fix this ten years ago but also basically no one ever told me how I should do it or even that I should learn it. It was just assumed that I knew.
Actually, I had tried to learn, now that I think about it. I read a couple books by Suze Orman and other personal finance people whose names I heard from Oprah. I had a Mint account where you were supposed to set a budget, and I did the thing they tell you where you write down every single cent you spend in a little book. This is supposed to make you more deliberate and thoughtful with your spending, kind of how logging all your calories supposedly helps you eat less. Neither of those things worked for me. I went overbudget every month. I would forget to write down my expenditures after a few days of trying. It just did not ever work for me. It was like, every month, I looked back, saw that I had fucked up once again, tried to do better the next month, only to discover that I’d gone overbudget on everything again. It was exhausting, and discouraging, and just made me feel like an idiot. Like maybe I’m just bad at budgeting. I always struggled with math. Maybe budgeting just wasn’t my thing.
But anyway. I came back from New York poorer, sadder, and feeling a whole lot dumber than when I left. And now I had student loans, and the same income (once I found a job) as before, so I had to learn budgeting. Had to.
Somehow I stumbled upon zero-based budgeting, and no exaggeration, it changed my life. I use a service called YNAB (You Need A Budget), which costs money but it unlocked a whole world of personal budgeting for me, so it’s worth it. It’s also called “the envelope system,” which you may have heard about through Dave Ramsey. (Dave apparently didn’t get along with Oprah, which is how I ended up trying to follow Suze Orman’s system instead of his all those years ago.) Instead of looking backward at all the money I had spent in the last month, instead of trying to budget based on output, zero-based budgeting has you look at the amount of money that you have, and allocate funds to categories based on that. Like if your rent is $1000, but your paycheck today was only $750, you cannot put $1000 in your rent category. You just can’t. That money doesn’t exist. This somehow managed to switch my perspective around so that I was looking forward with my money instead of backwards. And I started to think about my money in terms of category balances, instead of bank balances. The fact that my bank account has $1000 in it means nothing, my Movies category has $0 in it, and so I’m not going to the movies. YNAB also highlights categories that you’ve fully funded with a little green circle, and I’ve kind of made it my mission to get categories green and keep them green. It gamifies it just enough that it works for me.
So that’s been my past four years or so. Turning into a person who actually knows what’s in her bank account and what her credit card balances are. I have a retirement account with multiple hundreds of dollars in it! I also have a personal net worth in the negatives (because of student loans), but I’m paying on those too and watching balances decrease. I save for trips and pay for them out of pocket instead of on credit cards. Who knew. I’m a person who can budget, given a wage that is more than half the median national income and the tools that make sense to my brain. And that is no small victory, as far as I’m concerned.
Random resources that helped me, in case you’re looking for help:
- YNAB software. It currently costs $84 a year, which is probably less than you’re paying for Netflix, but is also more than I’m paying currently (I got grandfathered in to what the cost was when I signed up). If $84 seems like too much, they have a YouTube channel where you can watch tutorials for free and get a sense of zero-based budgeting. There’s a bit of a learning curve with the software, but once it clicks, it’s like a whole new world and you’re off to the races.
- Dave Ramsey. I listened to his podcast a bunch, both to learn and to keep myself in the mindset of being mindful with my money. I’m pretty sure I disagree with him about just about every social issue, and I don’t like how he steers college kids towards prosperous careers instead of doing-what-you-love careers, but when it comes to finance stuff, he has absolutely helped me.
- Bad with Money, a podcast by Gaby Dunn. It also helped keep my attention focused, and I appreciated her perspective of “I’m fucked up and don’t know anything about this and that’s my bad, but also, the system itself is not much better.”
- Various communities on reddit, including r/personalfinance and r/ynab.