How do you manage your finances?

I've been using You Need A Budget (https://www.ynab.com/) for a while now. It's a proactive, digital envelope, zero sum budgeting system thathas radically changed my relationship with money and has drastically improved my financial wellbeing in the two short years I have been using it.

I cannot recommend it enough

My wife and I use a simple spreadsheet, one sheet where we list our incomes (annual) and another sheet where we list our shared expenses (mortgage, car payment, average electricity bill, Internet bill, etc). Some of our payments are monthly, some every two weeks, some are weekly, etc. The important part is to determine how you're going to uniformize those payments on a single metric.

On another sheet we calculate the sum of our incomes, and we split the total expenses by our respective percentage of the total income, so to be fair the expenses are split by the percentage of income you bring home otherwise. So if I bring 60% of the income, I pay 60% of the expenses.

We end up with a rundown of each expenses split by the percentage of our respective income, with a total of expenses to be paid every week for each of us. All these expenses are paid through a shared bank account, and each of us is responsible to put that amount every week into the bank account (easily done through automated transactions).

We adjust the spreadsheet from time to time to make sure our incomes and expenses are accurate, and so far it's been working well for over 10 years.

That leaves us with a slice of discretionary income for each, which we then use to put into saving accounts, treating ourselves, etc.

I use an app / tool called Monarch Money. I was using Personal Capital (now Empower). Both worked, but I liked the idea of paying a smaller monthly fee to Monarch than potentially "being the product" with a free service like Empower. So far, so good. It helps me keep track of things, and the mix of interfaces on web and mobile work pretty well for me.

I use hledger, a plain text accounting tool. It is a command-line application that parses, validates, and generates reports and statistics (and more features I don't use) for double-entry bookkeeping transactions that I've recorded in a text file of a particular format. One major advantage of plain text is that I can version control and sync the data with git. Additionally it is free software (GPL-licensed) and has pretty active development. I can see why this system wouldn't appeal to some people (maybe they have a more complicated financial picture, prefer a nice GUI, etc.), but for my circumstances it is perfect.

Quite frankly, I manage my finances pretty badly from the perspective of an accountant and people probably shouldn't follow my lead, but maybe you can glean some lessons from my approach, as it's the only thing that works for me. I don't do well with keeping a budget or trying to keep receipts, so I tend to go for more of a hierarchical approach, where I get the important stuff out of the way first, and the money trickles down to the less critical stuff from there.

My general overall philosophy to money is thus:
First, Live
Then, Save
Then, Enjoy

Which means that, when you first start making money, focus on buying and paying for things that will stabilize and improve your quality of life. A decent apartment with good amenities, good cookware, clothes, bedding, etc. Stuff that will make life easier for you and give you the ability to more easily make money and do your thing.

Then, save up an emergency fund (the usual target I hear is 3-6 months worth of essential expenses, which for me is around $5-10K) so that if you ever fall on hard times, you won't immediately be put back at square 1. This is extremely important for me personally because I am the most nervous of nellies so it really helps my peace of mind to know that at any moment, my entire life could fall apart, and I wouldn't have to actually DEAL with it for quite a while, I'd be safe.

Now, this is also where stuff like contributing to retirement savings can come in right after the emergency fund but before 'fun money', but I find that those types of savings are more based on someone's specific situation and plan, so it's kind of up to the individual what you do there. I generally try to max out my Roth IRA every year and chuck some money in a mutual fund when I feel like it, but I could probably be a lot more deliberate with my savings.

Then, once you have everything you feel you need, and a good safety net, then you get to really enjoy yourself as an adult and spend your remaining cash on whatever the heck you want. Vacations, nice meals, parties, concerts, toys, games, etc. That's when you really get to enjoy the fruits of your labor.

Thankfully, I make enough money and my expenses are cheap enough that I could spend over half my paycheck on enjoying myself. And some months I do, but I live a pretty minimalist lifestyle, so on a lot of months, I don't end up spending my entire paycheck, and I just put all the rest of it into savings/investments. Which tends to keep the numbers going up, which also makes me feel good :) Lately I've also been trying to do nice things for the people in my life for whom money is tighter, kind of spread it around a little.

Since I'm a bookkeeper by training, I use QuickBooks Online, which is rather overkill for personal finances, but since it's the tool I already use for my business I use it for my personal finances as well. It lets us get very detailed reports of where my wife and I have been spending, for better or for worse.

Some people love him or hate him, but my general financial “method” is the baby steps from Dave Ramsey.

For my own processes, I am old school and write out all my finances on a legal pad down to the penny. I have an automatic allotment for my retirement and manually allocated how my investments/contributions are set. I do a quarterly audit of my family’s finances to see where things are. We tend to be very loose with budget because we both grew up in very poor households so talking about money is stressful.

My Wife has be do all of the financial stuffs to avoid panic attacks or feeling like we are going to drown back in poverty. I have been very thankful how successful we have been as 1st gens (Wife has a M.Ed. and I have a B.S.).

Hoping to get a house in the next 5-10 years and really start moving into the upper-middle class. Rent keeps getting jacked up for us and I feel like we are being squeezed for more than we earn in the big city.

Do you have any recommendations or resources for methods, software, processes, etc?

I live in Emacs, and I try to get as much done by using human-readable, human-writable files. In this case, it means using org-mode to organize a record of every single one of my transactions - broken down into categories - logged in ledger's format, tangled out and queried through org-babel.

That is, I have a file which looks - when I actually remember to transcribe my receipts - a bit like this:

* 2023
** 01 January
*** [2023-01-01] Groceries
#+begin_src ledger
2023-01-01 * Payee
  Expenses:Food:Produce           €2.00 ; :iva04:
  ; 0.500 kg green stuff
  Expenses:Food:Meat              €6.00 ; :iva10:
  ; 0.250 kg red stuff
  Expenses:Hygiene:Shampoo        €2.50 ; :iva22:
  ; 1x Hair goop
  Assets:Cash
#+end_src

In this case, I use tags to log how much VAT (IVA) I am paying on each of these items, which is a really for curiosity's sake, but they also come in handy to group expenses that I can deduct from my taxes - e.g., medical expenses, school expenses, public transport.

I try to be as granular as possible while logging every receipt, but I got worse at this over time. I used to log every receipt as soon as I got back home, tangle out the file and see how much I spent during the month, but stress, other chores, and the fact I am lucky enough to not need a budget mean I just periodically reconcile my ledger with my banks' websites while muttering to myself about how I need to spend less money, gods-damn-myself.

I've got all my bill pages bookmarked in one folder, and a reminder on my phone once a week to check them. Often means checking things like my car payment 4 times a month even though I paid it the first week, but I've never missed a payment and clear my credit card debt weekly. I know what I make weekly and I do a quick sum up of what my bills were for the week and keep a mental note of if I went up or down (which is pretty bluntly reflected in my actual bank balances)

I wish there was something that handled all this better, but the options i've seen out there have left me unimpressed? Mint strikes me as shady, but has the best integrations, taking out a ton of the manual work and automatically tracking ALMOST everything, but still lacks some of the features/organizational materials I'd want. I've looked at things like YNAB and it's competitors, but i just don't simply work that way, and will often forget to throw in things and send it out of wack.

You Need a Budget (YNAB) for me. It took me a few tries to really have it 'stick.' It is uncomfortable at first, even as someone who was already keeping an income / expenses tracker via a simple Evernote note. I would subtract from it as I spent money. YNAB is a lot of work up front, and forces you to experience scarcity. This is it's bread and butter. Assign every dollar a job. A value. It forces you to visualize and assign your financial goals money. It forces you to make trade-offs. A goal a year from now for clothing? An unexpected vacation opportunity from a friend's invitation? You can decide if you want to move some money you've begun saving for the year ahead goal for an experience now.

Here is YNAB's Method / Four Rules

• Give Every Dollar a Job
• Embrace True Expenses: making future expenses, or likely expenses, a savings goal or turn a larger $ amount into smaller monthly savings up until the expected date.
• Roll with the Punches: be flexible, "be like Water," values change, and money is to serve you and your goals as they change
• Age Your Money: use last month's income for current expenses

--

Overall, I recommend the personal finances and investing advice from the Bogleheads community Wiki.

Everybody here seems super organized, so let me give you another example. I don’t keep track of anything, and never have. I have an automated setup to transfer money to a savings account, that’s it. When I bought my house, I transferred nothing each month. But when a got a windfall of 20k, I dumped it into the mortgage. This lowered my monthly payment. The difference I started transferring to the savings account. So my monthly expenses didn’t change. After each year of saving and with each bonus I received, I’d do the same thing and pay off a part of the mortgage. This increased the speed with which I was paying off the dept greatly. And I hate being in dept.

This is of course coming from being in a comfortable position to be able to do things this way. With current housing prices I wouldn’t have been able to save as much as I have. But I do feel that living in your means, not splurging on things, helps tremendously. To put it into perspective: I’ve been making a great living but have never bought a new car or even had car payments. I’ve always driven second hand beaters that were bought outright, like 15 year old Camrys. And I’m a car enthusiast, not like I don’t care what I’m driving. I’d just pick up $1000 project cars to enjoy on the weekends.

TBH, I work for money, deposit the paycheck, check the balance and pay the bills. I leave a cushion of a few thousand before I make any big purchases and don't really worry about the rest. At one point the amount coming in was close to the amount needed for bills, food and gas, but since developing a career and getting raises and paying off debts freeing up more excess income it hasn't been a big deal to have to think about or calculate out.
I'm not the type of person who goes on excessive shopping sprees. I do have hobbies and buy things but I've never tried to go overboard where I needed to plan a budget for something, just wait until the account balance is high enough to keep a decent cushion. To give you an idea, my monthly statements usually have about 20-40 transactions on them and I almost always earn more than I need every month. I'm very low stress about the whole money thing. And if I can take the next step in my career I stand to make more than double what I've been previously making.

I don't use any formal systems or services, just my bank's unlimited free savings accounts and their online banking platform. I have a separate account for every recurring expense, plus general categories like gasoline, medical, activities, long-term savings, etc. I literally have over 50 of these. Every time I get paid, that paycheck is automatically dispersed among all the different accounts using a fleet of scheduled transfers I set up with the bank. I'm salaried so my predictable paycheck makes this easy. Whatever remains after all of those allocations are processed is my petty cash for the pay period.

For all of my recurring payments on auto-pay, I also have scheduled transfers to move the money out of their designated savings accounts, into my primary checking account, the day before. That way most of my bills just take care of themselves and I don't have to think about it.

I think this is similar to YNAB but I don't use that and haven't looked into how it compares. When I set up my system years ago I was modeling it off the old cash-based "envelope method." I like it because it keeps my spending on rails and automates a lot of mundane stuff. But it was a pain to set up initially and is still a hassle to make changes to it. The online banking system UI wasn't built with this use case in mind so even though it works, it's clunky.

I've also augmented my system a bit over the years with some balance-projection scripts I wrote to normalize the discrepancies between my monthly expenses and my biweekly pay period, which get out of sync over time. I think it's cool but probably way too nitty-gritty for most people looking for a budget system. Because of stuff like that I wouldn't really recommend my weird bespoke method, even though I've been really satisfied with it for about 15 years or so.

I currently use two systems to manage my finances. One of them being YNAB 4, the old pay-once-own-it-for-life version. It's not super fancy, but it gets the job done for me, and I'm just so used to it that I don't see the point in changing my setup at this time. I primarily use this to keep a mental tally on what I've got my money saved towards, and how I'm looking financially.

The other system is a spreadsheet with all sources of income (pay checks, credit card rewards, investments, etc.), along with a link to some proof of that source of income. This helps me when it comes time to do taxes, but it's also nice to make sure I'm not being screwed by someone not paying me what I'm owed.

I used to have a weekly auto investment with Robinhood, but I currently have that on pause. I plan to resume it after I am able to max out my yearly 401k and IRA contributions. I figure gambling on Robinhood takes a lesser precedence than securing my wife and I's future.

I also have an auto investment of just a few dollars a month dedicated towards buying worthless crypto on the very off chance that another doge scenario happens again in a few years.

I've been using YNAB4 consistently since 2018. I hate having to pay subscriptions for things if I don't have to.

I don't really use it the correct way, but mostly just as a way to keep track of where I'm spending any money and what trends I've got. I've never really had to do the whole "Oh I've already hit my budget for X this month so I can't get this." It's more just being able to say "wow we've already spent Y on eating out this month, we should really try to make more food."

Also it helps me see just how much more money I can put into savings than I would think, based on all the incoming and outgoing funds.

I'm on dissability, I secretly paid my rent 3 years in advance so my monthly budget right now is

$930
Minus $130 for bills
800
Minus $200 for rdsp
$600
Minus 200 for grocery
$400
Minus $300 towards my debts
$100 - put in savings

I could do more, but I think I do enough for the assets I have. I track my budget and log all my expenses in a spreadsheet, and I have NerdWallet on my phone for checking trends over time - decent enough app, does what I need, I don't have to think about it much. I try to stick strictly to the budget, and I budget conservatively; I don't include income like dividends, interest, cash back, et cetera, so that if I do end up going over, I have a bit of a buffer. That way I also feel more at ease when I make a large purchase and type a big number into the sheet, since it's never as bad as it looks. Maybe I'd be better off doing something more involved to get a completely accurate picture, but I'm doing alright.

For context, I do alright for myself, but I'm still having to be careful with my money - more than 40% of my income goes to my rent, for instance. I just hit one year in my position, and hopefully the raise I've been hearing about will come through. That would really help the emergency fund.

Main account into which my salary is paid and my bills come out, as well as savings and investments..

This automatically pays an amount per week into another current account which I use for day to day spending (which I find easier to budget weekly rather than monthly for). I also have several savings 'pots' within this that I filter some of the incoming every week into it for things I don't consider a main bill, but which aren't every week (like clothes, holidays etc).

The latter account allows me to categorise all my spending so I can easily see a breakdown by category etc in the app and compare month on month (I pull the data from my main account into it too, so all my spending is tracked).

By having a separate 'pocket money' account I can easily spend money on the fly without risking over spending. My main account only has standing orders and direct debits, I have a card for it but would only use in an emergency, so if it's in my day-to-day account it means I know I can spend it without needing to worry about an upcoming bill, and because I top it up weekly there's no worrying about spending it all at the start of the month.

The initial setup for this system takes just a few minutes and I find that it works great.

1. Find your complete monthly income after taxes
2. Calculate all your big static bills (rent, car payment, phone, internet, etc.)
3. Look at what you have left over and budget your spending money. I give myself $500 every 2 weeks to spend on groceries, subscriptions, and fun. If you have a family you may need to increase this allowance.
4. Set the rest to be automatically deposited in a high yield savings account and investments.

This system works great for me. I know every month that my important stuff is taken care of, but I get to fly by the seat of my pants on a daily basis with the rest of my budget. It's a lot easier to manage $500 in your head than a few thousand and any mistakes you make with your money won't affect your housing, transportation, or savings.

Three components:

• GnuCash is my digital "register"/checkbook application where I manually record all transactions that come from my actual bank account. I check this against my bank's site regularly.
• Chronicle iOS app free version - I use this to keep track of all of my bills- especially ones I pay manually. Important things like cards, loans, rent, utilities, etc- things I absolutely cannot miss, some of which are not auto-paid. It sends me reminders, has a phone screen widget- and I check it weekly to make sure I'm not missing any payments anywhere.
• Rocket Money (previously Truebill) as a free way to get a good overall glimpse of all of my recurring subscriptions (YT premium, Twitch, Discord, etc). This helps know how much additional money I have that is "tied up in auto-payments" in monthly expenses for less important things, and helps me consider what I may want to cancel and/or what I can improve (yearly vs. monthly costs, etc)

I use a spreadsheet too (formerly Excel but recently LibreOffice Calc - its free) and I do all the tracking and billing because my wife just doesn't like anything to do with numbers. We have one main account, everything goes in, and almost everything comes out of there. I pay everything monthly, and the sheet does summaries for all income and expenses, calculates percentages of each and I check how we're doing month over month as well as checking our net worth occasionally.

I really like paying bills, oddly. I like seeing them all get 'slain' and seeing how much is left over. I started out adult life with a VERY tight budget (Three kids, a mortgage and a stay at home wife by 29) where an extra $100 car repair would kill our budget for months.

We dont save much in cash but we have a health bit of equity built up in several rentals that are the bulk of our retirement plan.

I have only just begun trying to get my finances under control and also take advantage of any benefits/resources available to me. Currently I just use SoFi with all my accounts integrated to get a view of my personal net worth, track where I am relative to my spending limits for the month, and doing minor investing ($50 a week). I personally like it a lot but I'm sure it isn't as fully featured as other solutions that people are using, but I honestly don't see what there would be to gain from switching over.

The only thing I am missing right now is forecasting balances based on spending habits, and I feel that would be a nice thing to have where I could simulate major purchases or life decisions affecting my accounts. For example, what it would look like if I had a kid, my car broke down, moving to a new home with new tax burden, etc. Right now, I just plug my estimated costs into an excel spreadsheet and forecast that way

This is very much UK-specific, but I bank with Monzo, which is one of the 'challenger' (startup) banks we have over here. (The other challenger bank is called Starling, and they have the same offer.)

Monzo doesn't have branches, everything is done through a smartphone app. I'm paid monthly, and all of my bills are monthly (except car insurance, which is annual); this is normal for the UK. The Monzo app then allows me to set which day of the month is payday, and then realigns everything around that.

I pay my bills through direct debit (if you don't have a direct debit system in your country, it's basically a mechanism you can use to authorise a business to take money from your account on a regular basis), and the app keeps track of this, and shows me two balances: how much money is in the account, and how much will be left once all the outstanding bills for that pay period have been paid. The app tracks how far through the pay period I am in terms of both days and money, and from that, estimates how much money I'll have left on the next payday if I keep spending the way I have been so far in that pay period. I like to keep that number as high as possible.

In terms of savings, I have a big chunk I put away into an interest-earning savings account each payday, and a smaller amount that goes into a 'savings pot' (a thing that Monzo offers) that I use to designate for paying my car insurance, car tax and roadworthiness test when that all comes round. Any money left over at the end of the pay period also goes into the savings account.

I don't have to keep detailed records, because my only income is from my job and bank interest, which means that His Majesty's Revenue and Customs already knows it all, calculates my tax for me, and instructs my employer to deduct it from my salary before it even hits my bank account.

As for pension fund contributions, I just have to tell my employer how much I want deducted, and they handle that too. (If that sounds like something your employer shouldn't know, in the UK, employers are legally required to make contributions to their employees' pension funds, so they already have that information.)

As for achieving financial goals, my only goal right now is to buy a house, so it's a matter of putting as much money into that savings account as possible.

Low-income person here. I do it the old-fashioned way, with pen and paper. For me, this forces me to engage with the numbers, to write them down, and examine them. When I had a high-paying job (before raising children), I contributed to a 401K and an IRA and then left them alone. They seem to be doing OK. I mostly manage finances by living as simply as possible and doing what I can to spend less than I earn. The result is that even though I'm low-income, my credit is excellent, and I've learned to separate needs from wants.

I use Simplifi. Its the easiest for me as it does a lot of things automated. Rocket Money also looked promising but I wont use it til they have a full web site.
I used ramseys before and really liked it but hte price was ridiculous.
YNAB just doesn't work for me for some reason. I can't take to it.

I tried YNAB twice before and I just can’t grasp it. I think it fails with its credit card integration or theory and I pay for EVERYTHING on credit.

I ended up using Co-pilot and it’s working fine for me. There are a few banks that it doesn’t connect to (via Plaid) but I just iodate those manually for now. I like having one place to look at all my accounts. I’d put it as a competitor to Personal Capital (Empower).

I have always gravitated towards just using spreadsheets, I love the flexibility of building them up to show exactly what I want and how I want to see it. For the last couple of years I have been using Tiller and have been very happy with it. It has the backend like Mint/etc that can pull in all of your transactions/balances across all your accounts but then it dumps it into a spreadsheet (google or excel) so then you can do whatever you want with it or just use their default spreadsheets

I've been using Xero for my small business. It's much lower cost/hastle than Inuit and has not yet hit the enshitification stage and my accountant and CPA seem to be happy with it as well. It integrates to all of my accounts and makes cost tracking simple enough. I might try a separate account for my personal accounts.

I used Gnucash for my personal accounts for a few years and it's is fine but lacks the visualization and integration features I want. It also took a lot of manual effort on my part. I always wished there was a way to auto categorize transactions based on how I dealt with previous transactions of the same vendor.

As a former YNAB4 user, I left the burning ship that is online YNAB.
(As a Swiss user, automatic connection to US banks is of no interest for me.)

I used https://financier.io for a long time, but this is more of a hobby project and I did not like the direction it is heading from the discussions on the sub on the site that shant be named.
Basically, this might be abandoned.

I am in the process of settign up on budgetwise, which goes into the same direction.

I have adhd so through trial and error I’ve found a system that works for me

I have separate current accounts for everything ie one for bills, one for food, one for household expenses, one for personal spending etc. When I get paid I then move all the money into the correct places at the right amounts and then that should be it.

I have a spread sheet that details every incoming and outgoing that I can adjust whenever there’s a new regular payment or an old debt is paid off etc. it’s just a normal spreadsheet, no fancy service

Every app or service I tried, I just ended up ignoring the notifications. Having it as automated as possible really helped.

For saving I then just save any money that was left over from the previous month

I also have it set up so whenever I make a payment it rounds it up to a round number and puts the extra in my savings, every little bit counts. That savings account doesn’t show me how much money is in there unless I click on it so I can’t see the money and impulse spend it

When I was just handling my own finances it was fine but now having a partner (who also has adhd and would starve if left to handle his/our finances) and a dog, it’s hard. Mentally keeping up with all of it is hard but automating most of it has helped a lot

I automate as much as possible. Direct deposit gets split between different bank accounts.

One is a fixed “bills/savings” account where all of my regularly, monthly bills get paid automatically. I send enough there for those bills, plus the amount I decided I wanted to save. When the balance of the account goes over a certain amount, I move the excess to a brokerage account where it’s invested.

The other checking account is for daily/weekly/variable spending. I watch it pretty closest and if I get close to $0 I know I can’t spend any more until next payday.

I intentionally made moving money between the different accounts difficult.