All about that Budget

Having a budget.For my birthday this past year, my brother gave me budgeting software.

As a mechanical engineer, one would expect that from him. However, as a journalist, one would not expect me to be happy to receive it.

Called YNAB (You Need A Budget), I am able to implement my budget and money spent through the app on my phone and laptop. There are a lot of neat features about the app, and I never EVER thought I’d be one to enjoy tracking my money so closely. Honestly, it can get very depressing very fast to see how much I spend on a monthly basis.

But, there is one aspect of YNAB I really wanted to focus on. YNAB has a methodology behind its budgeting madness. There are four key focuses, and the first one is “Live on Last Month’s Income.”

The idea is simple: Build a cushion so that you are not living paycheck to paycheck. It means planning ahead and saving money as time progresses. So, I put $100 in my groceries budget for the month of July. Hopefully, I just spend $80 that month. If I do that every 30-day period, I will basically have a $100 cushion in my grocery budget. And by December, I will have $100 in that slot before I even get my paycheck. Not spending that much is definitely harder then it sounds, and it will depend a lot on your lifestyle and paycheck.

However, the concept is one I want to be kept accountable to. By living on last month’s income, you’re not waiting to be paid on the 30th of the month. I mean, what if something happens and your paycheck doesn’t come? You’re screwed.

What got me thinking about money was Jonathan Burgard’s blog about becoming a debt-free Affiliate owner in a year.

If only that could be possible for student loans, as well.

I wanted to take Burgard’s idea one-step further: Once you are debt free, stay that way. One of the ways to do that is to budget appropriately. Another YNAB focus is to “Save for a Rainy Day.” You don’t want to have three of your five rowers suddenly go out of commission with no money to replace them. When the air-conditioning starts leaking, you don’t want to have to dip into your own paycheck that month. You want to have had a plan and a pocket of money saved for that.

Budgeting is not fun, and I’m only doing it for my personal life. I can’t imagine trying to implement it for a business. However, it has saved me plenty of times when I needed a new tire or had to pay an unexpected bill. Sure, the planning ahead takes a bit more work, but I promise it will ultimately be worth the tedious data collecting.

Heather is the editor for Box Pro Magazine. Contact her at