It may not sound fun, romantic, or exciting, but I must admit that I really look forward to our monthly budget planning meeting. We treat it like a date! The kids are in bed and we’re together focused on the same thing. We’re on the same team working to achieve goals. Seeing our progress, reaffirming our goals, and making sure we’re on the same page is motivating and fun!`
Before I lay out the way we do our monthly budgeting meetings, I want to be clear that there is no one right way to do your budget planning meetings. The important part is that you are doing it! We have ours monthly, but you might want to do them more often (I think they should be at least monthly.) You are checking in and holding yourself accountable. You’re tweaking, making improvements, and celebrating progress. The details and agenda will vary from couple to couple.
Before we assess our progress on our goals, we have to make sure all of our numbers are right. We want to make sure that our accounts (transactions and totals) match what we have in YNAB. Reconciling with two people is pretty convenient (though it’s totally doable on your own too). I’m usually at the desktop computer with YNAB open and my husband is on his laptop with each of our accounts open. We go through our checking account, and each of our credit cards with my husband reading off all the transactions and me marking them as cleared in YNAB. Then we compare our totals. It’s really fun when the numbers match up just right and we can reconcile immediately. Sometimes we’ll find that we forgot to enter a transaction or there’s one that’s entered twice, or we transposed some numbers or something and it requires a little detective work before the account reconciles. It’s probably nerdy to admit that it’s fun either way, so I won’t.
While my husband is in each of our credit card accounts, he pays the bill. One of my favorite parts of using YNAB is that we don’t have to worry if there is enough money in the checking account to cover the bills because when we “spent” the money from our categories it stayed in the bank just waiting for the bill to come. (For more on how we use YNAB, see the related articles at the bottom of this post).
Two of our credit cards earn points that we redeem for “cash” or statement credits. They don’t have a certain threshold that has to be reached in order to use them, so we apply them each month before paying the card. Since we have all the money on hand to pay our credit cards each month, the cash back goes straight to our debt repayment! For those curious how we work that in YNAB, we enter the cash back as income for that month (instead of the next month, like we do for all of our other income), then it’s funneled into our “end of the month payment” category.
For those who are new to YNAB, remember to record your money transfers (i.e. paying your credit card bills) so that YNAB shows that the money goes out of your checking account (outflow) and goes in to your credit card account (inflow). When you make that single transfer it will show up both under your checking account and your credit card when you look at them individually.
After we make sure our accounts match YNAB and pay our bills, we go through and add any extra money left in our categories to our end of the month debt payment category. You can read in detail about our personal approach to maximize our end-of-the-month payment if you want to see the explanation with screenshots. You could leave the money in those categories and roll them over into next month (like we talked about in this post), but our primary focus right now is paying off debt, so we empty our categories each month.
Make Our End-of-Month Debt Payment
When everything is re-distributed and the category balances (third column) are at zero, we pay the remaining lump toward our debt (our end-of-the-month debt payment)! Depending on how the month went, sometimes it’s small, but it’s always worth celebrating! Before we used YNAB, we didn’t have an end-of-the-month debt payment at all because we had no idea how much we could spare.
Update our Debt Spreadsheet
While my husband is signed into the student loan servicing site to make the end-of-the-month payment, we record the payoff amount of each of our loans. You would think there would be some place where you could get a total like that (how much you owe total, plus interest), but there isn’t. Since they make it inordinately difficult to know how much you really owe, we keep track on our own spreadsheet and update it each month. We have caught mistakes and inconsistencies in their records, so it is worth tracking. I make note of our “total paid in debt” and “total debt remaining” to post in our monthly reports.
Budget and Goals for Next Month
Since we are living on last month’s income, we can budget (allocate money to our categories) for the entire next month. If you aren’t to that point yet, you’ll just fund your categories each time you get paid.
After we fund our categories, we decide what our beginning-of-the-month debt payment will be. We usually make it a pretty good chunk of what we have remaining unbudgeted. We tentatively leave the rest in our end-of-the-month debt payment category, which gives us some flexibility for unexpected expenses.
We pay the beginning-of-the-month chunk toward debt and start getting excited about the month. We review our goals and get pumped to spend as little as possible so that we can put more toward our debt at the end of the month!
A Few Key Points to Remember
- Couples, remember that you’re on the same team! Work together. Build each other up. Don’t point fingers of blame.
- Make it fun! Seeing your progress and working to stay on track is a positive thing. And if just having your budgeting meeting isn’t exciting enough, pull out a carton of ice cream and two spoons (that always works for at least one of us)!
- Focus on your progress! In order for budgeting meetings to be sustainable, they need to be positive. Of course you will see areas that need improvement, but don’t dwell on your shortcomings.
- Get excited about your goals! I always come away from our monthly meetings with renewed hope and motivation.
Set a date, time, and place for your next budget meeting. Let your spouse know that there will be refreshments served, so it’s an event he or she won’t want to miss! If you’re spouse- and partner-free, invite your accountability buddy and celebrate together.
- Do you have regular (monthly, weekly) budgeting meetings? Do you dread or look forward to them?
I’ve mentioned all these posts a time or two, but now you have them all in one place:
- The Best Thing that Ever Happened to Our Budget: Why we switched from Mint to YNAB
- Budgeting Every Penny: Zero-based Budgeting with YNAB
- Living on Last Month’s Income
- Maximizing Debt Repayment at the End of the Month
- Using Credit Cards With YNAB
- Building Your YNAB Budget (Day 7)
- How to Make Your Budget Flexible (Day 11)
- Budgeting for Unexpected Expenses (Day 13)
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