Recommendations on resources for managing Personal Finances?
December 28, 2022 1:54 PM   Subscribe

I've been trying to get a grip on my spending. Please could you recommend any genuinely useful books or other resources that perhaps gave you a light bulb moment and helped you to change your spending habits? I'd love to hear personal stories with specifics of where you were then and where you are now to help boost my motivation!
posted by Sunflower88 to Work & Money (18 answers total) 12 users marked this as a favorite
Dave Ramsey anything (either listen to his radio show, or The Total Money Makeover book). He's a jerk, has bad politics, kind of an idiot, grating -- but at the same time, he very much understands the importance of psychology and mindset required to fix your personal finances. I will always find him annoying, but he will always be the motivation for me turning my financial life around completely.
posted by so fucking future at 4:15 PM on December 28, 2022 [2 favorites]

Can you keep ALL of your spending in ONE place, like, to a specific credit or debit card? And limit your cash expenses?

That way, you can throw that into Mint or such and track your spending through categories much easier. Then what is required, and what are frivolous becomes much clearer.
posted by kschang at 4:19 PM on December 28, 2022

I don’t have books to recommend but when I was going through a period in which my spending in a certain area felt out of control, it helped me to just record it in a spreadsheet with complete honesty and minimizing self-judgment. It made me think twice about buying if I’d have to write it down and be accountable for it. Also I could look back months later and see if any of the items had brought me lasting pleasure or value (they seldom did). I have been feeling a bit out of control with impulse shopping again and what I’ve told myself is I can buy stuff but I should write down what I feel I’m getting, or looking for, from the purchase—is it novelty, do I feel this new pair of shoes will make me exercise more, do I think this new shirt will make me look better, and then examine if I think those are really true and see if there are other ways I could get to that ultimate goal. Usually the honest answer is that I’m craving novelty and a temporary dopamine hit…

I’ve heard good things about YNAB but haven’t tried it.
posted by music for skeletons at 4:20 PM on December 28, 2022

If you want a cheesy reality show, search on YouTube for “debt do us part” and watch Gail Vax-Oxlade address spending stuff with couples.

I also liked The Millionaire Next Door and Your Money Or Ypur Life but they are also dated.
posted by warriorqueen at 4:48 PM on December 28, 2022 [2 favorites]

I will share a system I use: I have two credit cards. One is used for normal month-to-month expenses, basically gas and groceries. The other I hold in reserve for large or unexpected expenses, like having to replace a refrigerator.

The first card is paid in full every month. If you encounter trouble paying this card, then there's something out-of-whack with your monthly expenses. Or possibly there's a charge there that shouldn't be.

The second card normally has a zero balance. If it's non-zero, either you bought something and know exactly what it is or, again, there may be a charge there in error. This "backup" card is allowed to carry a balance forward, since it's for big ticket items. But when it has a balance, paying it down should be considered a priority.

So the first card helps you regulate your regular expenses, and the second helps manage unplanned expenses.
posted by SPrintF at 6:10 PM on December 28, 2022 [3 favorites]

The first thing to do is to understand where your money is coming from and where it is going. Sort of echoing music for skeletons, create a spreadsheet and record _everything_ for a month, then categorize it and analyze. You could also do this in Quicken or some app as long as you can apply categories to expenditures. You can either start recording at the beginning of a month or you can go through your checkbook and credit card statements to analyze an already past month.

First thing is to determine if you are spending more than comes in. If that's the case you know you need to change expenditures. After that, categorizing expenditures helps to determine what you must spend on (rent/mortgage, utilities), what you have to have but can adjust (groceries, cooking at home versus ordering food delivery, etc.) and what you can cut out (some concert tickets, some drinking with friends, etc.)

But until you've put down all income and outflow you won't be able to understand it.
posted by TimHare at 6:49 PM on December 28, 2022

I loved Elizabeth Warren & Amelia Warren Tyagi's "All Your Worth: The Ultimate Lifetime Money Plan" and it, more than any other (and I read TONS of them. I grew up without any of that knowledge), pointed the way to how I eventually got on track to seeing personal finance.
Yes, she has a plan for that, too.
posted by Shunra at 11:47 PM on December 28, 2022 [4 favorites]

I really recommend The Financial Diet on YouTube and Instagram for fun videos and a great sense of community. It’s kind of like a better Dave Ramsey for cool, progressive Millennial women (and everyone really) who have learned a lot of financial lessons the hard way.
posted by smorgasbord at 3:14 AM on December 29, 2022 [1 favorite]

That way, you can throw that into Mint or such and track your spending through categories much easier. Then what is required, and what are frivolous becomes much clearer.

This is what we did four or five years ago, to get a clear understanding of where money was going and to try and see patterns and answer questions like "Are we eating out too much or is that not an issue?" At the time, of the available options I found Mint to be the easiest to use and produced helpful information, but that was a few years ago and I don't know if there are better options now.
posted by Dip Flash at 6:28 AM on December 29, 2022

Read lots of money blogs.
Get Rich Slowly, from MeFi's own jdroth
Mr. Money Mustache
The Simple Dollar
Dave Ramsay's a bit too hyperbolic for me, but if you like him, listen to his advice on debt, but be wary of his economic and stock predictions.

Use some tool/ app/ site to track all your spending. Set calendar reminders to review spending weekly and review all bills monthly.

Make a budget. Set financial goals. What's your annual expense for electricity, rent/ mortgage, taxes, car, gas, food, entertainment, clothing, insurance. Look at what you earn & bring home. Set a goal for getting debt paid down. Track that and reward yourself for progress. If you have a lifelong habit of casual spending, it takes effort to create new habits. For many people, reducing spending is a huge drag; going out to eat is fun, new stuff is fun. But financial stability and being debt-free is really awesome. Find a balance so you can take some trips and do fun stuff, but also work on financial goals.

My parents both grew up in the Depression, and I learned financial stability & frugality from them. When I see people blow through money, it makes me cringe and again when they complain about lack of money at the end of the pay period.
posted by theora55 at 7:01 AM on December 29, 2022 [6 favorites]

Lots of good past Asks about specific and general personal finance stuff. Lots of advice and discussion at places like r/personalfinance or the Bogleheads forum, often in exhaustive depth.
posted by cupcakeninja at 9:13 AM on December 29, 2022

The three things that helped my family:
- Amex Charge (not Credit) Card (i.e., "green") which forced us to pay it off every month (these days they seem willing to carry over and charge you interest on large ticket items, but we put our fingers in our ears and say la-la-la).
- Having a fixed amount ripped out of our checking account the Tuesday after each biweekly Friday pay into a cloud Bank Savings account
- Ear-marking a set amount of that lump sum to things we know we need to save for and/or aspirations (auto insurance, vacations, unexpected expenses, auto maintenance, home repairs, emergency fund, etc.) You could use a spreadsheet to track the different chunks of money in that account (I use a PHP program I wrote).

I realize this doesn't work if you are living pay check to pay check, but for us over time (26 pays per year) the set-asides added up, and then we had the pleasure of dialing back some of the splits since we had enough for our next vacation, or auto maintenance... which in turn meant that other funds started beefing up).

posted by forthright at 9:21 AM on December 29, 2022

Alvin halls books helped me to deal with my feelings and emotions around money as well as the straight forward budgeting stuff! Highly recommend, especially if you have family baggage around money or have experienced poverty.
posted by eastboundanddown at 5:44 PM on December 29, 2022

NPR's LifeKit podcast has several episodes on money. I can recommend at least three of them, haven't listened to the rest, but I'm sure they're solid.

A lot of people are going to recommend YNAB, but maybe look into zero-based budgeting or envelope budgeting first - this is the system that YNAB is based on, and there are other (cheaper/free) tools that work the same way. I found I've gotten better with money after switching to zero-based budgeting.
posted by gakiko at 1:44 AM on December 30, 2022

Seconding Get Rich Slowly. I haven't read the book but I liked the blog.

I haven't read it in forever so I wonder if it holds up, but when I was learning about personal finance I liked the book and blog I Will Teach You to Be Rich by Ramit Sethi. You could check out his blog first to see if you'd like the book. What stood out to me was his focus on getting the big things right so you don't have to sweat the small stuff, and on figuring out what's important to you so you can cut back in other areas first. A lot of his writing is about keeping your investments simple, so you might skim those parts and focus on the parts about spending.
posted by Tehhund at 4:00 AM on December 30, 2022

I would recommend the book Your Money or Your Life by Vicki Robin and Joe Dominguez -- revised in 2018. It was written in the early 1990's but I imagine the main premises would hold.

The program got me out of debt and to this day I have one credit card paid off each month in full (no debit card, just an ATM card). A second credit card is also paid in full each month, but is only used for certain recurring expenses -- some companies will cancel the card if it is not nominally used. My mortgage was paid off early. I am comfortably retired, even after becoming disabled.

In the '90s, I even volunteer facilitated the accompanying workshop for others -- but I worked straight from the first edition of the book for myself.

I am tempted to order this 2018 revised edition to see how much the plan has changed. It was a good plan!

I feel certain you will find a method that will work for you among all these suggestions being offered.
posted by alwayson_slightlyoff at 11:03 PM on December 30, 2022 [2 favorites]

For me it was coming across the Early Retirement Extreme blog about a dozen years ago. That and reading more about FIRE (Financial Independence / Retire Early) really opened my eyes.

Some people will be rolling their eyes now because there are definitely some aspects of, and people into, FIRE that are annoying, or over the top, or whatever. But coming across the basic concept, having previously never given much thought to how much money I would spend when retired, or how much money I would need in order to retire, or when that might be, was inspiring.

Previously I'd been putting some money aside for retirement but not much, and not a sum based on anything at all. I'd just assumed I'd carry on doing that, spending whatever I was spending at the time, and then retire when I reached the official retirement age (68 here).

I suddenly realised that, if you're fortunate enough and do some planning, you can retire earlier! It had never really occurred to me.

From then I took a lot more notice of how much money I spent, and how much I had to spend. I stopped spending on things on a whim, and gave myself a budget. I increased how much money I was saving, and learned more about the basics of investing into low cost index funds. And I was fortunate that I learned all this before several years of rising markets.

I'm not living on rice and beans or anything extreme, but I'm in a much better position than I would have been if I'd never come across any of this stuff. I'll be able to retire sooner than 68.
posted by fabius at 10:37 AM on December 31, 2022

Seconding the recommendation for I Will Teach You to Be Rich. Read it for the first time about two years ago and it was very educational in terms of concrete, actionable steps, but it also really opened my eyes to the psychological factors in how we approach money. Ramit Sethi also has a podcast that digs into these aspects where he speaks to real couples about their money issues, it’s well worth a listen.
posted by Fuego at 1:46 PM on December 31, 2022

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