Ledgers, and Spreadsheets, and Apps, Oh My - Budgeting Tools Have Come a Long Way, Baby
Part Three: No Budget, No Freedom
In Part One of the No Budget, No Freedom series, we covered the fact that most people don’t have a clue what real budgeting looks like.
To the clueless, budgeting is restrictive and limiting.
If it’s not on “paper”, then it’s not a real budget.
Three things are needed for successful budgeting: The right mindset, a plan, and discipline.
Part Two talked about getting back to the basics. What is a budget, what is it designed to accomplish, and how?
Today’s article will focus on simple budgeting tools.
It is not complicated.
A Budget is simply a plan to regulate incoming and outgoing cash flow. A family budget accounts for the income/expenditures of all those who contribute to household finances.
Remember the three essentials: Mindset, Plan, and Discipline.
Assuming the right mindset and discipline, creating the right plan for your financial picture is essential for success.
A plan is simply having an objective or goal and creating a detailed outline of how to achieve it.
Integral to any successful financial plan are the tools and methods to carry it out.
A Very Brief History of Budgeting
Budgeting has been around in various forms since the beginning of recorded history. It wasn’t until more recent times when individuals and families have become free to pursue their own financial destiny that personal budgets became relevant.
Before the dawn of personal computers, individuals, families, and small businesses used Ledger Books for bookkeeping purposes.
While not necessary, due to the myriad of online tools available, these are still popular with many in the Baby Boomer generation.
Modern spreadsheet software programs began in 1978 with Visicalc.
At the dawn of personal computing, software companies began developing personal application software. Microsoft was the first major producer with its Excel software. It quickly became the go-to spreadsheet for businesses and individuals.
As the power and capabilities of personal computing became more sophisticated, companies began developing personal budget software and budgeting apps (for mobile devices).
Unlike spreadsheets, these programs and apps could be accessed with a username/password from any device with internet access.
There’s an App for That
It’s true.
The number of personal budgeting tools today is massive, with new and more powerful applications being developed every day.
Whatever your personal financial needs are, there are tools designed to help you accomplish your goals.
NerdWallet, a great site for financial literacy, has published The 8 Best Budget Apps for 2023.
These apps do slightly different things and go beyond simple budgeting, so today I will focus on just two that stick to the basic tenets of budgeting - one free, one paid.
Created in 2006, Mint is one of the very first budgeting apps and is still used by millions.
Nerdwallet has this description of Mint:
Mint, for just about everything
Why we recommend it: Let’s start with Mint’s very high ratings in both the App Store and Google Play. (It also has, by far, more reviews than any other app we reviewed.) It’s free and syncs many kinds of accounts: checking and savings, credit cards, loans, investments and bills.
As far as the actual budgeting, Mint tracks your expenses and places them in budget categories which you can personalize.
You set limits for these categories, and Mint lets you know if you’re approaching those limits.
Besides those tracking features, Mint may help users pay down debt, save more money and track goals by providing "Mintsights."
The app also shows users their credit score and net worth.
Bonus: Mint provides tons of support for using the app, including a detailed FAQ.
The good news is that MINT is free to use if you are just looking to track your money. This would be a good app to use in conjunction with a more detailed budget app, like YNAB below.
Mint is primarily a detailed financial tracking app. If you want a more proactive hands-on approach, there are other apps that are a better fit.
YNAB is an acronym for You Need A Budget.
Started by Jesse Mecham in 2004, YNAB became one of the most popular online personal budgeting applications.
YNAB’s claim to fame is that “it works because it’s built around Four Rules designed to change your financial future.”:
Give Every Dollar a Job
Embrace Your True Expenses
Roll With the Punches
Age Your Money
YNAB is feature-rich. First, it is accessible with a login from any device with internet access.
It can be set up to automatically distribute income into the proper categories and help track expenditures, savings, and debt paydown. You can create customized reports with time frame and category choices to give you a big picture of where your money has gone.
Reports are also very helpful at tax time.
A great feature of YNAB is the vast library of tutorials, blog posts for users, and live chat.
This just touches the surface. You can check it out for a free 34-day trial period.
The negative side is that it costs $14.99/monthly or $99 annually which includes very responsive technical support when needed. With that said, it is, hands down, the best out there for serious budgeting.
Where to start?
Which one should you use? It depends on what you want to do.
If you’ve never budgeted before, Mint would be a good place to start as the first thing you will need to do is get a handle on your spending.
And you may find that it’s all you need.
Once you understand the inflow and outflow of your money, a budget will help you prepare for daily purchases, long-term goals, and special occasions.
Another benefit of budgeting is that you may find that you have money you didn’t think you had. That’s always a nice surprise.
For my family, money is not the cause of anxiety like it was before we began budgeting. My hope is if you have not had a budget before, you will start and experience the freedom of knowing where your money is.
If you are budgeting, I want to encourage you to continue and then show others the benefits.
Finally, you may not be comfortable with either of these apps. There are many others to choose from. Experiment until you find the one that fits your lifestyle and goals.
But whatever you do, just start.
As always, thank you for reading Life UnCorked. I appreciate your support.
Until next time, my friends …
Thank you for reading and supporting Life UnCorked. While you’re here, check out my creative writing ‘Stack: The Talking Pen, where you’ll find fiction & non-fiction short stories, serials, poetry, art, and a short memoir.