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Ask HN: How do you manage your finances?

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Re: Ask HN: How do you manage your finances?

#31

Post by fjd »

This is not financial advice but here’s what I do:

High level - "Earn, Save, Invest"

In order for your money to make more money you need to execute all three steps: Figure out how to make money, manage not to spend it, and produce a return from that money.

Try to optimize each step. Make more money if you can / are comfortable (deserve a raise? change companies/jobs? start a side hustle?). Spend less (make and live by a budget, cook your own food, buy used, get cheap hobbies, stop keeping up with the Joneses). Understand the tax efficiency, risks, potential returns, and effort required from different types of investments.

I take credit for none of the ideas above, they are cobbled together from various online sources. Some things to search / places to start: Reddit personal finance flowchart, The Millionaire Next Door, Index / Boglehead investing.

Re: Ask HN: How do you manage your finances?

#32

Post by mbm »

skydhash wrote: post #27

After a few years managing my finance after learning that I should do it (review of my first year of full time work), what I retain is two things: Envelope budgeting, Every dollar is used, and don’t sweat the small stuff. I have an envelope for each category of spending, each goal and one for saving. My income is split between these everytime I get it. I don’t bother tracking small expenses (less than 10$) if it’s no…

Just to clarify, you primarily use cash for day-to-day spending? And does that extend to bill pay as well?

Re: Ask HN: How do you manage your finances?

#33

Post by eclipticplane »

mikhael28 wrote: post #12

YNAB. ynab.com - for power users only. If you don't actually care about tracking your money, don't bother.

I replaced YNAB with TillerHQ. It dumps transactions into a Google Sheet/Excel and came with some standard templates. It's less opinionated than YNAB but way more flexibility.

E.g., I have formula-driven sheets that:

1) Aggregate taxable transactions across accounts that I can send to my CPA to prepare my quarterly tax payments

2) Aggregate account balances and period-over-period changes for my living trust that I send to my lawyer every year to include in the trust's documents

3) Flow into calculations for FiRE

4) Flow into aggregated/filtered views that I can share with specific family members, like showing what's in 529s I have for some relatives

and it's entirely in a spreadsheet in my account -- if they go out of business, all I have to replace is transactions import. The rest of the tool is forever mine.

Re: Ask HN: How do you manage your finances?

#34

Post by mbm »

JohnFen wrote: post #21
mbm wrote: post #13

Earlier quoted context omitted.

I like that, keeps it very simple and straightforward. Have you always done it this way, or was there a previous iteration?

I've been doing this for over 30 years. I've iterated to this. The first iteration was not managing my money at all. The watershed was when I had my first real success with my own business, combined with having my first child (both happened at about the same time). That forced me to face the reality that some sort of money management was essential, and through a couple of years of experimentation, I settled on this a…

Indeed, that mantra is a key part of Rich Dad, Poor Dad as well.

Re: Ask HN: How do you manage your finances?

#36

Post by xur17 »

mbm wrote: post #30
xur17 wrote: post #26

Everything flows into a spreadsheet I created that has a row for each month, and tracks my spending, income, and net worth. The data for each new row comes from a few different places. Lunchmoney aggregates and categorizes my spending data. My net worth is tracked in another spreadsheet that updates as asset prices change. This spreadsheet also tracks my asset allocation across my accounts, which is roughly based on…

Thanks for sharing. What was it like purchasing a home in this market?

It was a mixed bag. Interest rates were higher, but I also had a lot more negotiating leverage than I normally would have had. The house I bought had been sitting for a few monthd, which allowed me to get it for what I found to be a fair price.

And interest rate wise, I figure I plan to pay it off early, so I'm less concerned a out the rate.

Re: Ask HN: How do you manage your finances?

#38

Post by mbm »

xur17 wrote: post #36
mbm wrote: post #30

Earlier quoted context omitted.

Thanks for sharing. What was it like purchasing a home in this market?

It was a mixed bag. Interest rates were higher, but I also had a lot more negotiating leverage than I normally would have had. The house I bought had been sitting for a few monthd, which allowed me to get it for what I found to be a fair price. And interest rate wise, I figure I plan to pay it off early, so I'm less concerned a out the rate.

Good deal. Yeah, we recently did a small search and had a similar impression, but prices simply hadn't fallen enough in our market to justify moving forward.
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