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Ask HN: How do you manage your financials?
120 points by maith1 7 days ago | hide | past | web | favorite | 109 comments
Hey, Im wondering how do people go about managing their financials, between paying off loans, saving money and investing. Do people feel like they are making the best decisions when it comes to money?

I live well enough within my means that I don't have to bother with any kind of accounting. On a typical tech salary living in a relatively cheap COL area, I bought a house about half of the price I could afford. I exclusively purchase used vehicles (partly because I am am enthusiast and enjoy working on them, but even a 10 year old low mileage modern vehicle is pretty reliable and cheap to maintain), and I don't shop for the fun of shopping.

The result is a guaranteed growing savings which I periodically invest in various assets while trivially maintaining a buffer for emergencies.

The trick is to live modestly even if you have money. Also, stocks are basically equivalent to savings, since with modern tech liquidating funds and transferring them to your bank in an emergency can take as little as minutes.

There's so much uncertainty in money management that you're probably IMO wasting your time micromanaging. Pick a couple decent assets, or even an index fund, diversify with a little bit of gold or alternative market hedges, and leave the funds alone. There's no reason to overthink money management if you plan everything with a healthy buffer - but that requires self control. Less stress this way though.

Investing in an index fund consistently gives returns of about 5-10% a year. This turns out to be a LOT of money in the long run (1.1 ^ 30 = 20x).

Trying to time the market is a bad idea. Picking individual stocks is a bad idea.

This is assuming your main goal is returns on your investment. Picking individual stocks or even 30 stocks is basically gambling.

Really recommend reading "A Random Walk Down Wall Street": https://www.amazon.com/Random-Walk-Down-Wall-Street/dp/03933...

I'm so tired of these types of comments on HN that say investing in individual stocks is like gambling. It's such a tired piece of advice. Don't invest more than say, 5%, in an individual company, but choosing a selection of high quality companies that you believe in is not in any way like going to the roulette table.

It depends on the time-frame you plan to invest. If it's a short time frame, investing in individual stocks can be OK.

There's just so many variables that go into the price that something that causes the stock to go up/down 20% can be completely unforeseen.

A broad market index won't have these weird fluctuations. Almost every single market strategy underperforms broad market indices in the long run.

Even hedge funds that outperform the S&P in one period perform average in the next period. In other words, past performance of funds has no impact on future performance. On average hedge funds picking individual stocks consistently underperform compared to broad market indices.

The issue I have with your statement is not that you're guaranteed in any way to beat the market, but saying that investing in individual stocks is gambling. It just isn't true.

Again, if you have no more than 5% of your portfolio in an individual stock then a 20% drawdown on that one stock is not going to significantly hurt you.

People should feel free to decide for themselves if they want to spend the time to actively invest vs throwing everything into an ETF and no one should be shaming them into thinking it's akin to going to a roulette table in Vegas.

As someone in tech, I've done quite well investing in high quality tech companies like Apple, Netflix, Amazon, and Nvidia over the years. I keep my 401K in a broad index fund but enjoy actively investing a part of my wealth.

> As someone in tech, I've done quite well investing in high quality tech companies like Apple, Netflix, Amazon, and Nvidia over the years.

I feel like I have a number of coworkers who make investments like this, that haven't really been burnt on this because of the bull market. And because they know tech better than most, that's what they focus on, and it becomes a huge sector risk, even though no more than 5 percent is invested in any particular symbol. If five years from now we learn that someone in big tech has been cooking the books (https://en.wikipedia.org/wiki/MCI_Inc.#Accounting_scandals) that could lead to a sector wide dip for a variety of reasons, far worse than a 5 percent drop.

What it comes down to for individual investors is that diversification is at odds with well researched investing. You just don't have the time to pour over 100 quarterly 10-Qs, build sales forecasts, or predict next year's return on the 10y treasury bond. It can be a fascinating hobby, and while I have a small trading account with the IEM, all my real money goes into VOO/AGG.

I don’t take investing so seriously like pouring over financial statements outside of skimming through earnings reports. I don’t live everyday worrying Tim Cook is committing massive accounting fraud. I invest in companies I understand, use/like, and reasonably trust, and it’s worked out well for me. There may come a time the whole market crashes again, but my gains are far above the index fund over the last 10 years, and if I need to derisk I will make that decision at a later time.

Again, I just thinking screaming “anything except index funds is stupid gambling and irresponsible” is untrue. I also think those who become truly wealthy in life necessarily have to do things that the average person is unwilling to do, like invest understanding there’s a risk involved.

> I don’t take investing so seriously

Then how do you know you aren't over paying for stocks? Your plan is to buy high and sell higher?

> it’s worked out well for me

My unvested RSUs have more than doubled in value over the past year, and ESPP has done just as well lately. The market has worked out great for everyone, especially those of us in high tech.

> if I need to derisk I will make that decision at a later time.

To me this reads as 'I will sell when the market drops hard enough to make me anxious.' A ton of institutional investors (think pension funds and university endowments) did exactly that, and it made them worse off in the long run. David Swensen calls that institutional strategy out as 'buy high and sell low.' IMO, buying into a down market is the real step the average person is unwilling to do, even though it's incredibly easy implement: sell off your winners and buy more of your losers.

If you have something more complicated in mind, I just am not ready to believe someone unwilling to bother calculating the present value of forecasted future earnings is bothering with looking at their Sharpe ratio and deciding 'welp, time to buy some VIX to offset this risk.'

> Again, I just thinking screaming “anything except index funds is stupid gambling and irresponsible” is untrue.

Even if you don't accept the premise (I don't[1]), doesn't mean active investors are a priori smart. I have yet to speak with anyone upset by the index investing philosophy I consider prepared.

[1]: There are clearly people who make a living doing this who dig far beyond financial statements. Random example I know of from a lecture given at Yale by a trader (https://www.youtube.com/watch?v=DMbhgSBIUfk&t=3875s if you can stomach the umms and ahs) reading Bond contracts ("indentures") and looking for companies that were likely to delay financial statements and owed bondholders par immediately. One such notable source of delayed financials was backdated options, and this exact accounting irregularities even affected the tech giant you mentioned, back in 2007. You may recall another facet of this story from HN favorite 'Why I did not go to jail' (https://a16z.com/2014/02/06/why-i-did-not-go-to-jail/) as this was widely practiced at the time.

If you have income and you're young, you can afford to take risks. Big tech is disproportionately represented in SPY/QQQ so if we're in a massive bubble it's all going down anyway.

I consider active investing to be a hobby. I get a kick out of seeing earnings reports come in from companies I'm invested in. Again, I've dramatically outperformed SPY over 10 years and the gains have nearly secured my retirement as someone in his early 30s.

I occasionally hedge with SPY puts or gold calls if I think we are in an actual correction. If it's sustained I would do that over selling.

> it's a short time frame, investing in individual stocks can be OK.

And then your gains are cut by transaction costs, opportunity costs and short term gains.

It depends on which index. The Dow Jones is an exceeding poor index and a good actively managed fund will out perform it easily.

The Dow does not take into account market cap or float, and when a security comes off of it at $5 a share and a new one goes in at $105 per share, then the index jumps $100 in value.

The S&P is better, but managed funds are usually better.

90% of managed funds have underperformed the S&P over the last 10 years and studies have shown the funds previous performance has little to no impact on future performance.


While it's true the Dow doesn't take into account market cap because it is a price weighted index, it is not true that removing a $5 security and adding a $105 one jumps the index $100 in value.

Every index has a divisor, which acts to preserve the return. The general calculation for an index level is Level=MCAP/Divisor. With the Dow, the MCAP is simply the sum of the prices instead of the sum of all MCAPS for the individual securities. When you drop one security and add another, the divisor is calculated such that it offsets the change in MCAP. In this way, when the index opens the next day it opens at the exact same level as the previous close and then the real time feeds kick in and update based on the gap up/down of each security in the Dow. The same basic logic applies to all top level indices. The calc changes for gross/net returns, currency variants, hedge calcs, etc. But the same principal applies that there must be a way to preserve the day over day return so that adding and removing securities doesn't throw off the actual index levels and returns.

Your 401k and other investment accounts that report performance do the same thing behind the scenes - particularly 401k. With a 401k you are consistently adding money to your investment pool and placing small trades to obtain more shares of a pool of securities. This influx of money doesn't artificially inflate your personal return for the year because the way the calculation is done is very similar under the hood to how an index is calculated.

Interesting that you claim that, since I usually only hear the contrary (actively managed funds don't perform better and the fees are too high).

Does anyone have specific data on this? Does anyone

I work in this industry. We have detailed reports on damn near everything, including private hedge funds and how they perform. 80-85% of any active management or financial advisory services have not beat low cost index investing over the long haul. The top 15% or so can and do, but the vast majority of the active investments players (that 80% or so) don't make enough to beat passive investment once their fees are taken into account and an appropriate passive benchmark is used. Meaning, if they are actively investing for their client using only US securities and products, we use a major US benchmark to compare against. If they are global, Asia-Pac, Dev/emg, etc. we use one of those to compare against so we are looking at apples to apples. A lot of times they will simply invest in a high growth emerging market and tell their clients that they are beating the S&P 500. Yeah, of course you are. But you aren't beating the relevant emerging markets growth products.

What are those top 15%? Is it the same 15% each year? :) Does it include big players that anyone can sign up for like Fisher or Fidelity?

Yeah, that's what we do as well. After the first couple of years in my first job, during which I spent a little bit more on stuff I couldn't afford before (sport equipment and such) but within my means, we stopped spending at a level below what our combined salaries would allow. It's a nice feeling to have enough buffer for a couple of months. And the opportunity to opt for a lower salary without any financial risk. Generally sound advice to live below ones means. And stay there.

EDIT: One thing that helped a lot in doing so was to treat any bonuses, whether that is stock, years end bonuses or any variable salary elements, as just that. A bonus. Don't plan with it as part of your salary, put it aside. And only use it for stuff, like, a house. Or true emergencies.

Also, have a separate bank account at different bank. Put every month, even a small sum is enough, on that account. Every month. Every year. And never look at that account, ever. Until the world is to end and you need cash. Until that point, don't even think about that account, never ever. Forget it is there.

I agree with your conclusion but for me personally, I am afraid of spending even though I have money to spend. And when I do spend the money, it gives me a lot of anxiety.

I started keeping track of my budget so I can comfortably spend without the stress.

I feel like you need a goal or you need some sort of framework to make yourself feel safe.

Say here's just an example (DO NOT QUOTE THIS): Most people don't know how much money they should have for retirement. The FIRE movement suggest Expense * 25 = Your Nest so you can take 4% annually. People don't have to follow the FIRE lifestyle but the calculation itself could give some deadline/goals to keep yourself "sane" because Mathematically it looks "sound" (better than NOBODY KNOWS!).

Nothing wrong with being extra responsible!

Do you do any sort of financial planning for retirement? What you've got going for yourselves seems like it's working for you, but curious to know hat would happen if the "tech salary" were to stop.

You forgot bitcoin. Lots of bitcoin on the side. That way you can retire in peace.

this is terrible advice. They should put it all on red.

What an amateur advice. Every sophisticated roulette player know you don't do that.

You put it all on Pair.

Lots of reading (books, blogs, etc.) has been helpful for me the past few years and it seems like I pickup new things all the time. A few things I use/reference:

- YNAB (You Need A Budget) - budgeting/tracking app, plus lots of great content on how to use the software and generally manage your budget/expenses

- /r/personalfinance subreddit - checkout their wiki [1] and flowchart [2] in particular for a really helpful overview

- For investments I use spreadsheets to track allocation, targets, etc.

- Bogleheads wiki - investing, heavy on index funds, low fees, etc.

- Whitecoat investor - a lot of good content, mostly aimed at high income earners plus some content specific to medical doctors [3]

- A variety of books - there are a lot of good ones out there

1. https://www.reddit.com/r/personalfinance/wiki/commontopics

2. https://www.reddit.com/r/personalfinance/wiki/commontopics#w...

3. https://www.whitecoatinvestor.com/new-to-the-blog-start-here...

The /r/personalfinance flowchart is actually the best summary I've seen on the priority on spending. Some comments I'd add:

* If you run out of money before getting to the employer retirement match, you are living beyond your means and you need to rectify that ASAP.

* Avoid credit card debt especially; the interest rates are not in your favor.

* If you're making tech sector salary, it's probably best to maximize Roth IRA early and hard--you're likely to hit the salary cap on Roth IRA before too long in your career ($120K is when the contribution is reduced; $137K is when it disappears entirely--although note that 401(k) contributions are excluded).

All good points. Roth vs traditional can be complicated when you think about the long term possibilities (change in tax rates, early withdrawal, lower/higher income in the future, etc.) but definitely max out Roth/Traditional/Backdoor Roth IRA if at all possible after getting max employer 401k match. I like the idea of diversifying with pre and post tax retirement options to an extent. Backdoor Roth IRA is useful for high earners that don't qualify for a Roth IRA or Traditional IRA deduction.

I'd second Bogleheads (both wiki and forums) as a great resource for personal finance and investing. This is a good starting point:


I use beancount for text-based accounting (http://furius.ca/beancount/), and fava for budgeting and visualization (https://beancount.github.io/fava/).

But the tech just isn't that important, as far as I'm concerned... What actually makes a difference for me is, every morning (except occasionally on weekends), I enter the previous day's transactions, balance my books, and commit the changes to a git repo. I think balancing daily is important:

1) Balancing accounts can be a massive pain, but when I do it every day, it generally takes me about 5 minutes (so maybe 2 hours a month), while balancing at the end of the month, even if it only takes the same 2 hours, is very tedious and I have no motivation to do it, so it doesn't get done.

2) I've caught multiple instances of fraud and the occasional bank error or paycheck error within 24 hours of their occurrence. Not strictly necessary, but helpful to get it sorted right away.

3) One of the best ways to remember things is to review the next day. I find I have a much better picture of my financial state, and how much I've been spending recently, when I'm taking 5 minutes to look at yesterday's numbers, every single day.

Disclaimer, I work in corp finance:

My wife and I have what I believe is a novel approach. Our requirements were low mental overhead, but effective.

99% of what you read says to make a budget and follow it. Well, that sucks and is zero fun. It also doesn't apply to people who's income is significantly higher than their expenses, or people who are paying off lots of student debt or saving for a house etc since it just measures monthly dollars (income statement) and doesn't focus enough on where you are and where you are going.

We use a balance sheet approach. Every quarter 12/31, 3/31, 6/30, 9/30 we go through all our accounts, and calculate total assets (401k, cash, kid's 529 etc) and total liabilities (we have a car loan for example). After a few quarters you can see how things are moving and you can talk about decisions in terms of how it will impact future balance sheets.

One discussion we will have again this quarter is whether to pay the car loan off or put the equivalent cash in the market, or CDs to some other choice. TBH, we may not even do anything for a few quarters because we don't have to, but the balance sheet approach means we will talk it through in March which forces us to make an active decision, and not just leave the cash in a zero interest account while simultaneously paying interest on a car loan.

We also take that quarterly time to review things like life insurance, trust for our kids etc.

Side note, anyone have a good article on how to buy long-term disability insurance for office workers?

I do a similar thing on a monthly basis; track how much is going into savings/investments as opposed to expenses, and after a few months you can start talking about average savings/investments. Trying to track expenses is so tedious and prone to one-offs, I realized it's much easier to just see how much goes into accounts I never withdraw from.

I do the same, but bi-annually. Less micro-managey for me.

Personally, didn't feel there was enough fluctuation to justify 3 month intervals.

Yeah, that makes sense. When we started 5 years ago we were recovering from me going without a salary for a year after I tried and failed at starting a company. Then we got married, then we had a baby. We had a lot of rapid change that happened very quickly so quarterly made sense.

After we buy a house, we will probably do it a year or so, then move to bi-annual.

Started using YNAB almost a month ago, and I love it. I had previously tried Mint (terribly frustrating for all the promise it has, but it’s been left to wither) and my own spreadsheets. YNAB solves several pain points I had - budgeting for non-monthly recurring expenses was a big one.

Past that, I use a great credit union for liquid cash and mostly liquid emergency fund. The later we have pegged at 6 months of burn. Investments are across a couple institutions and consist of Roth IRAs and 401k stuff - that all goes in index funds.

I can mention that if you use mint.com and have anything that isn't quite perfectly standard about your financial accounts it won't work well.

for example- My wife and I have a joint brokerage account at Fidelity, and my wife also has a 401k at fidelity. She has a login associated with the brokerage account, and one associated with the 401k. However, via each login, all of her accounts are visible.

mint.com cannot understand that these accounts are duplicated. There are manual overrides to disable certain accounts, but these overrides work on some portions of the site (such as the overview page) and not other portions (such as the net worth tracker over time chart).

I feel that mint has already reached peak revenue per user and is now trying to glide through the rest of its lifecycle with minimal investment in the site, so these problems might not work out ever.

I recently discovered PocketSmith which is a paid product. I found it sort of follows the mint model but it works much better. I tried using double entry accounting methods like YNAB but it just wasn't working for my personal finances.

I use ledger [0] for all my personal finances. It's probably a little too nerdy for some folks but works perfectly for me: the combination of plain text [1] and the command line keeps me interested.

I highly recommend ledger for any (easily bored) programmer who wants to track their finances (and learn some basic accounting). Note other flavours exist too [2].

[0] https://www.ledger-cli.org [1] https://plaintextaccounting.org [2] https://hledger.org

We tend to keep it pretty simple.

1) We don't do debt. Certainly not for consumption purposes; we avoid it for capital purposes. We have a mortgage, but we saved and paid cash for the last car we bought; we might take a loan for a car... but even then we know the return we expect to get on the car would far out-weight the cost of the loan for the kind of car we'd entertain buying. A loan for education? Not unless a conservative expected rate of return justifies the debt: and I don't mean over a lifetime... but more like a decade.

2) A follow on to 1... We will avoid savings/investing (except for a very liquid, minimal emergency fund) if there is debt we can pay off early. Retirement savings are an exception because of tax law considerations. Our mortgage is low interest, and we might do better investing that money... but we might not and I know how much we save if we kill the mortgage early.

3) Don't spend what you don't have. Do your damnedest to not spend what you do have. Much of this goes back to 1. Many people create a budget as a means to give themself permission for otherwise unregulated spending on consumption goods... they'll budget a bit for savings and a bit for necessities... you know what's fair and "rational". But everything else is fair game and their budget, if they keep it, removes the guilt of what to me would look like over-spending. The default should be don't spend and justify each purchase. Yes, sometimes leisure is a worthwhile investment into yourself/family: but think through those decisions and alternatives that achieve the goal of leisure, but not at the cost.

Aside from that we use off the shelf software for tracking; but tools really are a minor consideration compared to having a healthy attitude to money and spending. We don't produce budgets because our default thinking is healthy. We do plan, but chiefly we just don't spend so that when crap does crop up we have the resources... or don't have the threats (debt)... as a default position rather than let-lose-spending with a minimum planned savings.

Note that none of this is investment advice. We're terrible at that side of the equation so I wouldn't offer it: but the first step is don't spend first what you might invest.... then you can worry what to do with your capital.

Finally... none of this comes from an philosophical anti-materialism or anything of the sort. It's all just being responsible for ourselves and our financial health.

Yup, i completely agree, especially on the budgeting.

The question should not be: do I have enough budget to make this pruchase. the question is: do I really need this thing I'm going to buy.

Budgets should be for estimating future spending or learning about your past spending behaviors. It's a tool for assessment, not a license to spend more.

I don't track things too closely, and I'm thankful I don't have to. I automatically max out my 401k and IRA, and a good portion left after that goes into taxable brokerage accounts. The vast majority of investments are in no-load index funds; I set aside a bit as "play money" that I'm comfortable losing, and which I mostly invest in tech stocks.

My wife and I tend to spend about the same amount each month and there are rarely surprises. I check the statements before paying just to make sure no fraud went unnoticed, but I get emails for any charge over $50 so I usually catch things before that. My wife and I both allocate some of our own earnings for buying whatever we like without having to consult the other--I'm not paying for her clothes shopping, and she's not paying for my Steam library.

I think this works because we're both naturally frugal people. Saving isn't effortful for us, but rather is the default. Just this past weekend, I had to remind my wife that it probably wasn't worth the Herculean effort she was putting into repairing a piece of jewelry she got on AliExpress for $2. I am sure proper budgeting and other tools could help us eke out a bit more net worth, but only a bit. The marginal return of that activity would be low for us compared to those who tend more toward spending than saving.

I like to keep things as simple (and profitable) as possible! I have a Roth IRA[1] and a taxable account[2] invested in leveraged risk parity strategies through M1 Finance[3]. I also have checking and savings accounts with Alliant Credit Union[4], both of which earn a pretty good amount of interest.

If you're looking for advice, I recommend reading through the wiki[5] over at /r/personalfinance and deciding what's best for your situation.

[1] https://www.bogleheads.org/forum/viewtopic.php?f=10&t=288192

[2] https://www.bogleheads.org/forum/viewtopic.php?t=302218

[3] https://m1.finance/r3lww4aeQ

[4] https://www.alliantcreditunion.org/

[5] https://www.reddit.com/r/personalfinance/wiki/commontopics?u...

I'm also running 55 UPRO/45 TMF in my Roth IRA, but I'd like to add a disclaimer here to note that leveraged risk parity strategies generally get their bonus from decreasing interest rates on the bond side and better risk adjusted returns from the diversification and rebalancing.

Whoever is implementing these strategies should also understand how daily rebalanced leveraged funds like UPRO and TMF work, rebalancing, and their tax implications in taxable vs non-taxable accounts.

These strategies generally perform well in up trending or downtrending markets vs. 100% stocks, but would not perform well in long term sideways markets(we haven't seen this in our history, but it could happen).

In periods of stagnant interest rates, the strategy experiences downside from from fees. NTSX will not be impacted by this as much as the fee for that ETF is 0.02%, but UPRO/TMF will lose 2% a year in these regimes.

In rising interest rate regimes, these strategies are even more impacted as rising interest rates will decrease the value on the bond side. If the federal interest rates are increasing during a period of stagflation, you will see very significant downside. What this strategy is doing is betting that the US won't run into a period of stagflation where both bond and stocks will drop at the same time. We are currently seeing a period of stagflation in Germany right now and if that were to happen here in the US, this investment strategy would perform poorly.

What I've posted is for informational purposes only, you should not construe any such information as investment, financial, or other advice.

I couldn't recommend a yearly budget higher. I have a "Banking" spreadsheet and a "Budgeting" spreadsheet that work together.

"Banking" tracks current assets/loans/etc as a current picture as well as predicting saving/interest/tax/return rates and giving an estimated assets at age X.

"Budgeting" tracks how much money is earned/spent in various categories and if it's on track for the years estimates. It also keeps track of expected yearly savings/spending and I sometimes adjust based on my habits/needs/desires.

I at some point every Sunday (either when I wake up or go to sleep usually) spend an hour a week updating all my accounts/spending. It's a great habit I've built over about 5 years now and it's really empowering. It's not about tracking every last dollar but more about knowing generally where your spending is going and if you're okay with those choices. It doesn't have to be set in stone either, but it means that increased spending is a deliberate choice you have to consider and weigh the value of.

It's a bit manual but I find rolling your own is really the only way to get everything you want. No software will cut it for sufficiently complex categorization (for example, I know exactly how much I spend on toilet paper because I break it out separately in a household paper category with paper towels and tissues), and building it yourself in code is probably a waste of time. Sheets/Excel really shine here.

For reference, I have about 15 or so accounts I check between credit cards, banks, investment accounts, Venmo, etc.

I collected data and figured out my family's average costs per week absent fixed expenses.

I have a spreadsheet that has a row for each week. I have it set up so that whenever my wife or I get paid, it adds that to the balance. Whenever a fixed expense is due, it subtracts it. It also subtracts the average costs per week for each week, and accounts for yearly projected bonuses etc.

The spreadsheet also shows any loans/loan payments.

Every few weeks I pay off my credit cards, go and look at my bank account balances, and compare that to the expected values in the spreadsheet. If they don't match, I figure out why and note that on the spreadsheet (i.e., unexpected surgery on dog, unexpected car repair, etc.).

The spreadsheet has conditional formatting that shows green if my bank balances are above my reserve amount for each week (including in the future), yellow if close, and red if under. I can see what my bank balances should be out through 3037 or so, when all my kids should be in college.

With that kind of a spreadsheet, you can instantly see when any loans you have will be paid off, and whether you can afford any purchase you're thinking of.

I use Ynab now. I used to use Hledger. Both are good but Ynab is easier for my wife to use. But the key idea is that you try to allocate your money before its spent. That way you know how much to spend.

I don't pay too close of attention to it, I'm fortunate enough that I don't have to watch my finances closely.

I try to keep as little in my checking account as possible. I have enough in a high yield savings account to probably last me a year. I max out my 401k. I have some money in six month treasury bills that gets reinvested whenever they mature. I have a recurring monthly transfer into a brokerage account that I put in a high dividend index fund. The only debt I carry is a mortgage that I overpay on. Anything leftover at the end of the month I throw into a Betterment account.

It's all in my brain. It's not a good idea and I know I should be keeping a budget, but every time I try, I end up ending reaching the conclusion that I should just focus on making more money instead. I have reasonable rent, no debt outside of a small car note and state-school student loans, and have good credit. I live a simple life, and I max out my 401k match + a personal IRA. There's not a large amount left over that matters all that much, and fiddling with Excel won't change that.

I use YNAB to manage my day to day money.

I use Personal Capital to manage my long term planning.

I invest via Robinhood, Betterment and Vanguard.

I use Ally's High Yield Savings as my long term savings such as a 6 month emergency fund.

I still use my credit union I had in Atlanta even though I am in Nashville. I prefer them because I've been a member there for almost 10 years, so I have a rapport with them. I rarely have cash, and when I do I just spend it. I go to Atlanta a few times a year so if I need anything, I can just pop in one of the branches.

That's really it.

Two tools: an annual budget spreadsheet and GNUCash.

The annual budget spreadsheet has a tab for every year, and every December I duplicate the tab and adjust for the coming year. It focuses on cash inflows (salary, equity grants, dividends) and outflows (expenses, taxes, investments). This is what I use to verify I can afford to max out 401ks and similar, as well as gifts/charity and maybe the occasional major purchase.

The other half of this equation is GNUCash. If the spreadsheet is a strategic plan, this is the tool I use to tactically manage cash flows and track assets on the ground. There are accounts for the typical double entry categories: income, expense, asset, liability, equity. It tracks in multiple currencies, including ticker symbols and custom currencies, and tracks conversion rates between symbols and my default currency. I have a variety of recurring transactions programmed in and created 90 days in advance, which is useful when paired with the 'minimum future balance' column -- if transferring money now would result in a future balance going negative (perhaps between a paycheck and rent being due or a CC being paid off), I can adjust.

What I don't yet have is a portfolio management layer. I have a few ideas in that space, but it gets complicated quickly with taxes.

I can't express enough how YNAB has changed my habits and make me realize _how_ to plan, forecast, and save money. They have lots of video tutorials and it's been worth every penny. Here's my referral link, happy to answer questions on how I use it too!


I record my expenses with HelloExpense[1] on Android, and I wrote a small app to analyse the csv export (using Python with Dash[2]). The code of the analysis app is available on Gitlab[3] and a demo is deployed on heroku at https://expenses-analysis.herokuapp.com/ (note that all work is done server side, so if you use it with your own CSV file, it will be uploaded to the server, so it's definitely better to run it locally)

It suits my needs perfectly, and I find it very useful, but from what I know I'm the only user of my analysis app :-D

Understanding where your money goes is a first good step in managing your finances.

[1] https://play.google.com/store/apps/details?id=com.helloexpen... [2] https://plot.ly/dash/ [3] https://gitlab.com/rbauduin/dash-expenses-analysis

I don't keep a strict budget, I am just generally frugal and don't spend a lot of money outside of food, groceries, coffee, and rent/utilities. I also only rarely drink for special occasions, which cuts a lot of expenses as well.

As far as travel expenses go I've been casually churning credit cards for a couple years now. A few new sign up bonuses on travel credit cards pays for most of my personal travel needs every year.

There's two kinds of spending: 1) Assets - these make money and make you richer 2) Liabilities - these cost money and make you poorer

I spent at least 60% or more on Assets. And keep liability spening to an absolute minimum:

- almost never ever buy new clothes

- xmas gifts - we don't play this game. we spend time with each other and make our own gifts, or buy them super cheap at yard library book sales, etc.

- always buy used cars, at least 5 years old and keep them for at least 10 or 15 years.

- absolutely no subscriptions (monthly payments) except utilities (just electricity, water, internet, cell phone, HOA, insurance). if you have more subs than fingers then you've got problems.

- minimize car maintenance (there's these big myths that doing lots of extra maintenance will make your car last longer, not necessarily true)

- no frivolous spending - I never buy stuff, unless I absolutely need it.

- rarely eat out, here in CA. eating out is way too expensive around here. and you never know what they put in it.

- never buy stuff you can get for free. why buy tea, when there's a lavendar plant in the yard? Rosemary bush yields are enormous. if you know a neighbor that has one, they'll glad you give you all the rosemary you want. etc...

I feel like some of this begins to cross the line from frugal to cheap. Hunting down a neighbor with a rosemary bush (aside from not actually providing the prepared leaves of camellia sinensis) instead of spending a few bucks on a box of tea seems absurd--it assumes your time and effort have no value at all.

By all means, don't waste money. But before even that, don't waste your time. You can always earn more money, but you'll never earn back time.

every dollar you earn is time wasted. paying for that 5$ rosemary at the store will cost will cost you 10 minutes of work time, if you earn 30$/hr after taxes ~ 90K/year.

And, I think 10 minutes spent getting to know the neighbors or hanging out with family to pick their rosemary bush is a much better use of time than yet another 10m working.

Every Friday I have a two hour window blocked on my calendar to work on financials. I review and categorize all transactions for the week, review how I am doing on my budget, check my credit score, pay bills, and check in on my goals (paying off debt, savings, etc.). I use Mint as my primary bookkeeping software, I also use Trello as a checklist to make sure I do everything each week and can also manage one time tasks.

I track account balances once a month into a spreadsheet to keep a high-level overview. It's a manual process that takes ~15 minutes and has a large payoff to have a birds-eye view of all the finances and allocations.

Investments are all automatic: max 401k, max hsa, auto deposit to vanguard into a few indexes. If cash balance gets too high, I'll do a manual deposit.

My wife and I aren't big spenders so I have never found much value in micro-managing individual purchases or categorization (YNAB or mint). I do skim the transactions a couple times a month to make sure there aren't any surprises.

wrt paying off loans vs investing: lots of approaches here, the emotionless take is to just allocate based on interest rate. If your loans are low interest, then just pay the minimums and invest the rest. If they're higher interest than you expect your returns from investing to be, then just pay them off aggressively and don't invest at all until they're paid off (the exception here might be tax-advantaged accounts like 401k or IRA if you qualify).

I draw a big rectangle with a line down the middle. On the left is Assets. On the top right is Liabilities (aka debt, the remaining lease payments for housing, etc). On the bottom right is Equity. This is the number that must compound at an acceptable rate no matter what happens to the market, my income, etc (I'll leave it up to you to decide what rate you want to commit to in the near term). I have found that drawing and redrawing this on paper beats most software approaches. If someone asks, "what if my equity number is negative?" I say take steps to get it to positive. If you get it to 1 dollar, great, your first year ROE is going to be 1000% if you happen to save 10 bucks that year. https://awwapp.com/b/uybcpyttt/

I have my budget in a spreadsheet. Top line is income, then the rest are expenses. The spreadsheet is really just for projecting what fixed costs and savings I can afford, I don't follow it strictly.

The key thing is the way all my accounts are set up. All money flows into the checking account, and then automatic deductions take the savings into different accounts for short term and long term. Money does not sit in the checking account for long (except for a small-ish cushion.) All spending is done on credit cards, which I pay off in full with automatic payments from the checking account. This way, I know when I'm over-spending, because I have to transfer money back into the checking account. This is key, because it means as long it's planned (for a vacation, for example), it's fine. But if it's unplanned, I know I need to be more careful.

I've recorded the date and amount of every contribution to my retirement savings. From that I'm able to calculate my all-time APY, and inflation-adjusted APY.

I used Banktivity for personal finances. I make sure everything is categorized.

Finally, I have a spreadsheet that calculates our monthly expenses (which I get from Banktivity) and knows the amount of retirement savings.

From those - our all-time APY, our savings, and our expenses - I am able to project what happens to our savings if we retire today, or what date we can retire if we want to always keep our savings above zero. It has an accurate social security model that assumes the trust fund runs out and we get paid at 80% benefits.

It's been a great exercise. The numbers are different (and more conservative) than most articles and web calculators counsel. Keep saving, don't rely on good investment performance.

I'm surprised to not see more Banktivity users. It's like Quicken with the option to do envelope budgeting. Unlike Quicken there is not a required yearly subscription fee, unless you want it to directly download your transactions from your bank. I prefer not to do that.

It does so much and the customizable reports and amount of info it gives you at a glance includes some things I don't see in other apps. Examples are savings rate (not present in any other app I've seen) and a calendar view of your finances (which is in a few apps, but not many)

I've ended up applying YNAB's 4 rules and way of managing money to Banktivity and it's working out fantastic for me.

BTW, I'm not sure why more people don't do this, honestly. Savings amount, investment return, and expenses-per-time-period are the three absolute requirements you need to be able to project if you can successfully retire without going into debt. Beyond that it's about being accurate, and for that you have to measure. You can't just say "oh I'll probably make 7%", or "Oh, a million bucks should be enough."

My 401k is maxed out and all in on FSKAX. Taxable brokerage is all in on VT and VTI. I have a Roth that I max out and invest more aggressively in due to the favorable tax treatment. 6 month emergency fund I’m thinking about bumping up to 9.

I don’t have any debt at a rate that makes me feel like I’m in any hurry to pay it off.

i’m 28, i make 36k per year, i have a masters degree and two bachelors degrees, all in hard science. i pay $800/month for rent, i ride public transportation, i try to cook at home, i don’t socialize. i can save about $5k per year. i’m comfortable and could live for a lifetime on less than $40k per year.

I think the entire concept of living within a targeted amount changes once you marry and have kids. but , you did a nice work there in shelving profits.. Public transportation is a boon for major cities

i’m never going to have a family

> i don’t socialize

I'm curious why you've made this choice.

I hope OP means something like I don't go to bars. Alcohol in a place that encourages you to stay around for a while is what passes for socialize to a large number of people.

There are plenty of other social things you can do in life, but I've noticed that there is a crowd where none of them count. Either you sit in your favorite bar and talk, or you don't socialize. My time spent camping with friends is interesting, but it doesn't count even though we spent plenty of time around the campfire (just to name one activity I do)

no i simply don’t speak to people casually outside of work. i just skateboard alone or explore or read or other solo stuff. i just don’t like being around people in a friendly manner.

cause i like to be alone

Like others in this discussion, I created a spreadsheet as well to keep track of my financial activity. I have 4 columns, one for me, one for my wife, one for my dogs, and one for the family. In the same table, I have a budget that is computed as the average cost of the last 3-6 months (which can be considered a good baseline) to make us informed about how we are deviating from it.

Common sense/ things that I'm applying:

- Never spend more than what you earn

- Save at least 20-30% to create an emergency fund & personal savings fund.

You may also be interested to read a recent & related HN post / course on this topic (CS 007: Personal Finance for Engineers – Stanford University 2017-20) https://news.ycombinator.com/item?id=21631834

IMHO the optimum financial plan depends upon your age and life situation. All require your family to work together and each member to grow in self-discipline. Here are tactics that worked well for my my family.

1. Learn to live below your means. This lets you build savings. The best tool here is a budget. Our family typically cooked at home, brought lunches to school or work, and bought staples on sale. Our kids had to choose activities that fit the budget. If it wasn't in the budget, we thought long and hard about buying it. If you need help, Dave Ramsey's books are good place to start.

2. Your next priority should be pay off high interest debt as fast as you can. If you have long term student loans, pay them down as best you can and start to accumulate (by saving) a six month emergency fund in an FDIC insured bank. The large percentage of families in the US where a $500 unexpected bill is a major problem is way too high. The emergency fund gives you breathing room.

3. Once you have an emergency fund, you should make sure to start saving for retirement and college for skill upgrades or for children. Someone once wrote that compound interest was the 8th "Wonder of the World". It is wonderful if we are talking about savings but is quite a taskmaster if we are talking about debt.

4. Become a self-directed learner. Invest time and focus in keeping your skills updated. Training budgets and travel to conferences were early casualties when my employer had major budget woes - that landed the company in bankruptcy. I paid my own way for critical training I could not get on-line. Some coworkers criticized me for this. I did what needed to be done. Those who didn't stagnated...

I wish you well. This will not be fun at the beginning and there will be times in your life you have to put up with things you don't like but can't afford to fix now. We had 2 kids in college, and our kitchen cabinets starting to fall apart. My wife hated them. That was the first thing we fixed after the kids graduated (same day, 1000 miles apart - we each attended one...)

I'm a big supporter for gnu ledger: https://www.ledger-cli.org/

If the itch you're trying to scratch is two parts "control" and one part "understanding", it's a scratcher like no other.

Since everything is text-based, you can slowly automate all the boring parts, as soon as they become boring.

At this stage, I have a scraper that downloads plaintext bank statements, payslips, and 401k transactions, a transformer script (mostly `awk`) that converts those csvs into ledger's format, a makefile that coordinates it all, and a git repository that all this crap lives in (raw data, processed data, ledgers, and code).

I use this to track investments, settle debts among friends and roommates, keep track of tax deductions, and maintain a birds-eye statistical view of my accounts. I check in about once every 3 weeks, I'd guess. I spend maybe 1 hour updating the ledgers and balance-checking, and another hour iterating on some module or another.

It's more work to maintain, but it's a labor of love, and I've learned a lot about accounting and programming along the way. It's like a meditation practice at this point.

Plus, if in the future I ever want to start a business, I'm very confident that I'd be able to keep track of my own finances without needing to hire someone or pay for accounting software, at least for the first couple years.

TLDR; vim + ledger + puppeteer + gnu utilities.

Have been using YNAB for about 7 years but the secret sauce is this: https://www.youneedabudget.com/the-four-rules/

Mint and/or Personal Capital to monitor transactions and balances. Capital One Money Market for Emergency Fund and Capital One Checking for checking. M1 Finance for taxable and tax-advantaged market accounts. Amazon Prime Credit Card (through Chase).

My approach started with Dave Ramsey, but has evolved a little based on "I will teach you to be rich" and some others. In general, I see my finances as a funnel - income comes in and flows to fixed expenses, then to retirement savings and kids education, then to short term savings.

* Tell incoming money where to go, don't live paycheck to paycheck. Doing this better is probably an area I could improve.

* Ensure a 1000 emergency fund in a savings account if you have none already. This is "lost my job" money.

* Ensure income > expenses. So much could be said about this, but it's simple math in the end. You won't get ahead if expenses > income. If this is not the case, focus first on income (ask for raise, look for second or better job, do side gigs), then on expenses (cut spending, get out of vehicle/credit card debt).

* Periodically review spending and see how you can spend less or increase income. I do much of my own car work (~3k this year) and work on some side gigs.

* Don't go into debt except for house. Pay credit card off each cycle. It is there ONLY to get the 1-10% reduction in spending via cash-back rewards. I don't personally feel chasing reward cards is worth it, just pick one that does cash back with minimal fuss. For us this was Amazon Prime's chase card.

* Ensure 3-6 months expenses in an emergency fund (Capital One Money Market). Example, if you average spending 3000/mo, you need 9000-18000. Now you have that long to look for a new job or float a huge emergency, etc.

* As long as that is maxed out, put as much as possible each month in tax-advantaged accounts. Max out IRAs/401ks/education savings/health savings/etc. Max out matched retirement accounts (401k, etc) first. Lest I sound rich, I'm not where I can do this every month yet.

* For IRA, use M1 because it's fee-free. Research a simple blend of ETFs in proportions relative to your risk profile. If you have a while before retirement, something like %90 Stock (VT,VTI), 10% Bonds (BND)

* Save any remaining in taxable stock account at M1 for short term savings (car/vacation/large projects/etc). Research a simple blend of ETFs in a lower-risk config. (ie 10% stocks, 90% bonds)

What is an M1?

I created a spreadsheet to keep track of my expenses, income, assets, etc. On the last day of every month I record the current balance in each of my major financial accounts (takes ~1 hour), giving me a nice view of my inflows and outflows, and net assets.

In terms of where I store money, I:

* keep an emergency fund in a checking account with 6x my monthly spending

* keep the rest in broad market index funds, currently 10% bonds, 35% international funds, 65% us funds. I put the maximum amount allowed into tax advantaged accounts (401k and roth ira), and the rest into a taxable account

I used to use Mint but it got too annoying so I am consolidating / closing bank and credit card accounts into one account.

I had some credit card debt that I just was able to put a huge dent due to my new job.

I manage my finances mainly through estimation of costs . So like for the first month of my new job I saw how much I used for personal expenses and calibrated to that.

I did splurge on some Apple stuff at the end of the year on credit .

My biggest problem is that I have been rolling over multiple 401ks over the years so I’m unsure of my return.

This is the exact problem that my company is trying to answer. There's no shortage of budgeting apps, but the real problem is addressing how people think about money, and how they learn and balance different goals they might achieve. So many educational resources, guides, and "suggestions" come from companies that offer (and profit off providing) the financial services they recommend.

If anyone is interested, I'd love to get feedback, hit us up on LearnLux.com

I have a book recommendation: Your Money or Your Life. It was recently updated, mostly to bring the investment advice a bit more up-to-date. But either version will be amazing. It's not an overstatement to say that book changed my life. It gives you some tasks, like tracking your spending (down to the penny), and ultimately strives to make the point that: you trade your finite time on this planet for money, so you should value it and use it wisely.

I use mint and a google docs sheet. Mint has some issues with investment accounts (as others have noted) but it is great at tracking expenses over time. Mint really works better if you use credit cards however.

I then take a look at my family's annual spending in mint from the previous year to help out together a new budget. It can be hard to predict some big things like home repairs, but overall I find using actual expenses keeps me honest about our spending.

I'm not a frugal person, but I don't like debt. I use a Google Sheet that I wrote many years ago that tracks my income and recurring spend. All of my receipts go through Expensify. I also have another sheet that tracks my spend (from Expensify) against my income to make sure lifestyle inflation stays in check. For investing, I have a 401k and a IRA that I contribute way less to than I should

I use Quicken, but not happy with it since they moved to annual subscription model. But with more than 20 years of data in it, I'm locked in. Looking to migrate to beancount, but the data migration is hard. I'm contemplating starting anew with beancount and forgoing my historical data. I could easily do without the data, but something psychological is at play, and I can't get over it yet.

Yeah I bailed on Quicken about 5 years ago and never looked back. Using GnuCash now, and it’s awesome because I can store the data in a local Postgres database and do whatever I want with it.

I love GnuCash!

The learning curve is a bit steep if like me you have to learn both the software and the concepts of double entry accounting. It took me a few iterations to get it right but now that it's rolling I couldn't be happier.

Since my girlfriend and I share some of our common expenses I developed a web app à la Splitwise/Tricount that can export transactions to GnuCash. It works very well but I never polished the thing, I wonder if it could be useful to other GnuCash users.

Oh man, my current project is to automate accounting for my cryptocurrency trades in GnuCash. I trade very high volume, futures and options, so being able to run a cron job to automatically pull the data from APIs, calculate gains, and load it into the GnuCash schema will literally save me hundreds of hours per year in accounting overhead. Once it’s done I bet I could easily sell it for $100s to other crypto traders.

I want to support LunchMoney.app. I've been using them for a few months, and Jen (the creator) has been really easy to reach for questions. It's the only online budgeting/finance web app that I've not felt was a chore, and I've tried almost all of the main ones like Mint and YNAB. LunchMoney "just works" and works really well. I highly recommend it.

I have tried using YNAB and Mint for managing my finances/budgeting but have come away disappointed. Currently I use a spreadsheet to budget the current year.

I have been thinking about writing an app to do the things like YNAB/Mint but better.

Would you like to see something like this? Would you pay for an app like this? What are some of the things you would like the app to do?

I use beancount to track every expense I have. It's really a powerful tool, check it out: http://furius.ca/beancount/ .

I started using the various tools the country I live in has for personal finance (it's France): Assurance Vie, PEA, Livret A, …

I use one of the robo-advisor apps (starts with W), and link all my accounts to it, and constantly play with it's retirement forecast calculator--it's the most sophisticated I've seen so far. Would love to use a second and even third one to see how much their forecasts differ.

I wish I learnt a few things earlier. like benefits of Roth IRA, why contributing to 401K is better even though the money is locked in until 60 etc.. felt incredibly stupid not starting them both in 20s. wonder what other no-brainer things like these are there. if any, please do share

Mint and spreadsheets to do forecasting.

The forecasting strategies mostly came from "I will teach you to be rich"

Can you elaborate on which strategies you use for forecasting from IWTYTBR?

Laddering, advice from the investments, etc. It's a good book, get it.

Everything in excess of £1000 from my monthly salary I move to a separate plain savings account without any bells or whistles, and the £1000 is what I spend on a month's living; rent, bills, food, pleasures. The end.

Saving 50% of what is earned. That half used for paying survival and whatever quality life you can extract from it. The rest goes to form portfolio: buying good stocks, rent, and currencies. Over and over.

Well, we have weekly budgets for living costs, monthly budgets for savings ect. We keep track with an app and avoid card payments if possible.

This works good for us. Pretty manual, but works out well.

I used Firefly III. It uses double entry bookkeeping. If you don't mind self hosting I recommended checking it out. The docker image is very easy to get going with.

beancount: Double-Entry Accounting from Text Files


I have used Personal Capital to pull in all the transactions and classify them into expenditure groups (entertainment, meals, utilities, etc.). Once you do it for a month or two, it pretty much knows what everything is (and knows a lot by default already). Then you can see where all your money is going and determine if you are spending too much in any one area like meals or something else that's discretionary and make changes. If you have your bank accounts hooked up along with your credit and retirement accounts you can also see your monthly cash flow as well as your net worth. You can also add your mortgage data to pull automatically like any other account. Also can log anything else that doesn't have an account which it can connect to and you can update manually to get the full picture.

For investments I'm restricted at work for compliance/legal reasons so I'm limited to ETFs and similar products (no individual securities). I've heard great things about Robinhood and would probably just use them or another no-commission broker (there are a bunch now). The easiest way to get good returns is just use index fund products. They have low fees usually and aren't that risky. You don't way outperform the market unless you really just get lucky, but it's very simple and easy to do. Full disclosure - I work in this area of financial services, but it really is a far cheaper option than just about anything else. Unless you have a stellar financial adviser (top 15%), they aren't usually going to be able to justify their fees over the long haul.

I pay my credit card multiple times a week so that I never pay interest and never get tempted to do anything foolish. Every day on the way to work I log on and pay whatever has posted that morning. My card has 2% cash back on everything, no limits (Citi DoubleCash), so it's very simple and straightforward.

I contribute enough to max out the legal 401k contributions allowed by law. If you can afford that, you should definitely do it. At the very least, get the employer match if you have one.

I have free accounts with Credit.com and Credit Karma. Log in periodically when they update to see where it has moved and why. They give recommendations - sometimes they are silly or not-realistic. But at least you can see what's going on and monitor for free.

Your credit card also probably has an identity protection tool - highly recommend this as it is part of good personal finance. Register all your known accounts, IDs, etc. so that you can get alerts if that data is being traded on the black market.

As far as additional savings, it's a roller coaster because every time I up the checking account over a series of months some large expenditure is needed (home repair/improvement, car, medical, something). But I try to mentally have a bottom in my head that I don't want to see the account go under and if it does, I try to cut back on extraneous things until it goes up by a fair amount. Over time, I raise that bottom. That allows for some growth in additional savings without having to be micromanaging a budget.

I always buy used, cheap cars. Neither my wife or I are car people. We don't care. Just an A to B type of thing. Highly recommend that. Pay X up front out of pocket every 5-10 years and then only around $1,200 a year in maintenance. Far cheaper in the long run.

We used to use "Managing your Money" and now we use Quicken for the most part. (that becomes more and more egregious given their changes).

We also live within our means which means managing future costs to the extent that we can/could. We paid off student loans, cars, and credit card debt. Then saved for a down payment and bought a house. We track 100% of the money coming in and the money going out and categorize it in as many ways as possible. This sounded pretty anal retentive to some friends of mine but they had to admit I knew exactly how much money I spent on food, mortgage, utilities, entertainment, etc each month. And that knowledge was usually enough to keep things from getting out of hand.

We targeted saving 10% of our income every year. Early on that was a more aspirational target, but by keeping our burn rate as constant as possible, with raises the target became achievable. We typically reserved 50% of any "bonus" or unexpected money for spending foolishly (well on things that aren't normally budgeted) and saved the other half. Once our savings reached a point where we had enough for emergencies we bifurcated into savings for us and savings for the kids college.

Then we started getting stock options or employee purchasable stock from our companies and used that to start a brokerage account (today I'd probably just put it in e-trade or something and go long on the S&P 500.) We were fortunate (really, its all about luck) to have chosen some good companies where the stock had some value. We diversified stock to fund the college fund.

We were always "behind" our peers in terms of new cars, or fancy vacations because we chose not to go into debt on such things once we could save up for them.

Looking back at it though it didn't really matter what program we used, what mattered were three things:

1) Keeping the discipline to track every dollar. This avoids "burn creep" where you start spending more and more and don't know it.

2) Always minimizing variability in costs (going from renting which was variable to a mortgage which was fixed, going from credit cards as cash flow (having a burn rate that is not always met by your cash flow means the occasional finance charge) to credit cards as payment device (once you have a reservoir of cash for overages you can always pay 100% of the balance every month)

3) Re-evaluating and adjusting costs every couple of years (new phone plan, swap out cable for satellite, sattelite for over the air, swap out ISP providers, magazine subscriptions, Insurance, etc. Any recurring cost from vendors in a competitive market has opportunities on about a 24 month schedule)

The only other thing is that we started pretty explicitly associating lifetime costs with bits of gear. (accounts call it depreciation) Basically saving $25 a month for "phone instrument" means that in 24 months you have a $600 to buy a new phone) Once you are keeping track of costs long enough and go through a replacement cycle or two you can get a pretty good feel for what things should cost)

I use Google Sheets and my banking app to keep track of expenses.

I'm in my mid 30s, from the Netherlands, and work remote as a software engineer for a company in the USA. My net income is about 4500 a month, rent in Amsterdam (NL) costs me about 1400 a month, then another 1000 a month for all other costs (insurances, food, electricity, car maintenance, parking, water, phone, etc.)

That sounds like I should save about 1600 Euros a month. In reality I also purchase things that aren't part of my fixed expenses. A brand new PC set me back 2000 Euros, a new floor in my home office set me back 600, finally getting a kick ass new wifi router will set me back 400, and I'd like Apple Car Play in my car that will set me back 400 as well.

My car is my own, though. No payments on those except the depreciation in value every second it gets older and every kilometer I drive it.

My biggest issue is my apartment. It's 100 square meters (1076 square foot), 2 bedrooms, an absolutely amazing view, and when I started living here 8 years ago I could rent it with a far lower income because of a financial crisis.

Now, the housing prices have caught up. I'm living in an apartment that I couldn't even rent anymore these days (they exact my net income to be 5x the rent). The value on the buyer's market would be around 500,000 Euros.

So, to get something in the same league of quality and comfort, I'd need to be able to purchase a house at around the 500k mark. I can't afford that and I don't really want to take a big step down when it comes to location, view, comfort, luxury, etc.

I don't buy new cars ever. My own car is a VW Golf from 2017 so the biggest blow of losing its value (e.g. driving it off the lot the first time) has been taken by the first buyer.

When I want something new I wait a minimum of 2 weeks before I decide. I've been wanting a VR Headset for a few weeks now, and just decided that, while I can afford it, I'd rather not.

I've been traveling a LOT in the past year and that ate up about 20k of my savings. Worth every cent. But I'm only left with about 20k in savings now. And I'm not sure what to do with it at all.

Of course I'd love to go into stock trading. I'd buy Apple, Microsoft, Amazon, Tesla, and just... I don't know, then what? They rise and... I sell? They lower in value and I buy? Is that it?

There's so much terminology going about in that industry. What's a "short" exactly? Yeah I can Google it but honestly, I don't understand it. Should I instead simply give my money to an Index Fund trading company? Sounds safe(r) at least.

Should I buy a house at half my max in a more rural area and live even cheaper for the next few years and save up about 200k?

Should I instead spend it all on traveling and experiencing life?

Honestly, I've known people in their prime who got the news: "You have cancer, you'll die in a year". Sucks to be rich then, doesn't it? (Note: Health care is fully taken care of here, you don't need money.)

Or what if I get hit by a car tomorrow? I've been in one major accident already that nearly killed me. I don't feel like planning ahead that much. I'm young and strong now and I might not be alive next year. Or in ten years. Or in 30 years.

I'll just apply sensibility in the sense that I don't want to waste all my money. I need a solid savings account. And if it doesn't make life boring, I should spend money working towards a more lucrative future.

But I have no clue as to how.

I have known people who died at 30 and their savings are wasted. However I also know people who are old and their body is failing - and they have nothing to live on.

In this region of the world we have a guaranteed minimum income, plus the pension that I built up during life. It should be a comfortable retirement even without savings.

But I get your point. In the case of an older failing body I'd probably just go for the euthanasia route. Why suffer when I've already seen and done it all?

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