At the same time, however, I was still craving a financial discipline I could follow. I used to follow Dave Ramsey, but I found that we couldn’t stick to his protocol indefinitely. It was a bit too black and white for us.
When I heard that the founder of YNAB, Jesse Mecham, had written a book, You Need a Budget: The Proven System for Breaking the Paycheck-to-Paycheck Cycle, Getting Out of Debt, and Living the Life You Want, I immediately went to our library’s site and requested it.
If you have not read this book, I highly recommend it.
In this book, Mecham takes the principles that helped him create his YNAB budgeting software and expands on them.
The chapters included in the book are:
Chapter 3: Rule Two—Embrace Your True Expenses
Chapter 4: Rule Three—Roll with the Punches
Chapter 5: Rule Four—Age Your Money
Chapter 6: Budgeting as a Couple
Chapter 7: Slaying Debt, Whatever Your Situation
Chapter 8: Teaching Your Kids to Budget
Chapter 9: When You Feel Like Quitting
Parting Words: You’ve Got This
Looking At Life Priorities
Mecham’s way to budget may be different from other budgeting and money management systems that you’ve previously learned. When setting up a budget, Mecham asks you to look at your life priorities.
What do you ideally want your money to do?
Oh, you want to travel to Italy? Great!
You want to save enough money to become a stay-at-home mom? Great.
There is no right or wrong answer. Decide on your priorities, and then create a budget this is in line with those priorities.
Second, budget for your true expenses. If you always overspend in December, take a look at how much you spend for the Christmas holidays—giving gifts, attending parties, etc.—and then either decide how to curb that expense, or budget for how much you realistically spend so you don’t go into debt and dread opening the credit card bills in January.
Likewise, your car insurance is likely due every six months, but if you don’t save money for it, you may be left scrambling to pay. Instead, divide the car insurance by six (for six months), and set aside that amount every month. When the insurance comes due, you’ll have the money waiting for you.
Other Pertinent Information
What I love about this book is that Mecham not only explains how to make a realistic budget that will help you achieve your financial priorities and take away the stress that comes with poor money management, but he also considers other special, potentially thorny issues when it comes to budgeting.
He has an entire chapter on debt. While he despises debt, not because of the interest you pay every month but because of the way debt impedes your cash flow, he doesn’t insist that you pay as much as you can every month to pay off the debt quickly. Sure, he wants you to be debt free, but a much more important priority for him is that you have a realistic budget so you don’t have to go into debt anymore.
Mecham also considers family members. There is a chapter on budgeting with your spouse, which can sometimes be a tricky issue.
Finally, there is a chapter on teaching your kids to budget, which is so important!
Mecham gives a great example of a woman whose mother helped her open and use a checking account at the age of 15. The mother later let her daughter open a credit card account and taught her that the account had to be paid off each month. (It didn’t, of course, but the daughter didn’t know that. By the time she learned that, she was already in the routine of paying off her credit card each month.)
I loved this book and highly recommend it. If you’re looking for a more personalized way to budget that considers your aspirations and dreams and offers a more moderate way to pay down debt, this is the book for you.
Have you read this book? If so, what are your thoughts?