Summary:
A listener asks ”What apps or tech do you use to help manage your finances?”
In part 1 of this two-part show I talk about:
- Why it’s important to build awareness about your expenses
- Banktivity: I use this app for tracking my expenses
- Mint.com: A classic app for budgeting and expenses
- YNAB: An envelope system for tracking your budget – which really appeals to some people
- Simplifi and Trubill: Another couple of budgeting apps that clients have recommended to me.
Don’t forget to tune into Part 2 where I talk more about investments, credit cards and financial planning.
Find out more about Mike at https://www.mortonfinancialadvice.com and connect at https://www.linkedin.com/in/mwsmorton/
Transcript
Welcome to real financial planning cast on K L available
Matt:wherever you get your podcast.
Matt:I'm Matt Robison.
Matt:I'm joined as always by Mike Morton, the host of financial planning
Matt:for entrepreneurs, the Mike Morton podcast, and also the proprietor
Matt:of Morton financial advice.
Matt:He's a personal financial planner advisor, Mike, welcome him back.
Mike:Yeah, thanks, Matt.
Mike:I love how you do that in one breath.
Mike:It's really great.
Mike:How you can just get all that
Matt:You know What's weird is I can't hold my breath for a
Matt:word I say on the air on radio.
Matt:I have terrible lung capacity, but for reason on the air, I'm able
Matt:deliver your entire bio in one breath.
Matt:I'm not sure what that says about me.
Matt:Or about frankly, Mike,
Matt:we are having a conversation offline.
Matt:This was actually a return of a feature we've been doing recently
Matt:of listener questions and reached out to a few regular listeners.
Matt:I said, so we've been on a run of episodes.
Matt:Did a deep dive those really cool kind of a masterclass type episode.
Matt:And we wanted to go back to covering some more listener questions.
Matt:What do you have on your mind?
Matt:And we got like 50 questions and so you were sort of diving through them,
Matt:trying to decide where do we go first?
Matt:And we found one that really appealed to me because I think this
Matt:is super useful for dopes like me who are not financial planners.
Matt:And just maybe in, in the course of listening a podcast or a radio
Matt:show like this, just want to make things a little bit easier in
Matt:their fine financial planning.
Matt:So here was the question.
Matt:here was the listener question.
Matt:What apps or programs do you use?
Matt:To make your financial planning a little easier.
Matt:And what do you advise that your clients use?
Matt:So Mike, I wanna get to that question first.
Matt:Let's just remind all our listeners, if you wanna submit
Matt:yet, we now have a long list.
Matt:So it's probably gonna be a few before we get yours.
Matt:But if you wanna submit a listener question, what's the best way to do that.
Mike:Best emails, .
Matt:Cool.
Matt:And you can also go on the Facebook page for beyond politics with Paul hos
Matt:and Matt Robeson, which is the page for the show that we appear on WK XL.
Matt:All right, Mike, what do you use?
Mike:Yeah, it's a great question.
Mike:I use of course, like many people, a variety of tools to try to have
Mike:different viewpoints depending on what I'm trying to accomplish.
Mike:You put it in the realm of, you know for finances, know what apps
Mike:do you use to govern your finances or get insights into your finances
Mike:or budgeting or all different items.
Mike:So Happy to talk through what I personally use and then also what I've seen my
Mike:clients use and what's been successful.
Mike:So I broke it down a couple categories, Matt, between budgeting investments and
Mike:then logging into you know wherever your credit cards or banks are, of course
Mike:you're gonna use kind of portals as well.
Mike:So you wanna start with the
Matt:Yeah let's do budgeting first, cuz that hits absolutely everybody,
Matt:at some point I think everyone listening to this has had to figure
Matt:out am I gonna go broke month?
Matt:So Very super basic thing to try to out.
Matt:Yeah.
Matt:So budgeting, what do you what you do or what do you advise
Mike:Yeah.
Mike:So I'll talk about a couple different things.
Mike:One, you don't have to have a budget.
Mike:All right.
Mike:Now that might sound like very bizarre coming from financial Pfizer.
Mike:Like you don't a a budget, but here's the way I always position
Mike:it because many people hate.
Mike:Tracking all that are expenses and spending it.
Mike:Doesn't bring a lot of joy to most people thinking, oh, do I
Mike:really have to track my budget?
Mike:And then you're just immediately coning.
Mike:This just means I have to find places to spend less money And I
Mike:don't like spending less money.
Mike:I like spending money, so you don't have to have a budget.
Mike:What you have to do is sure you have the right.
Mike:amount of savings.
Mike:For now and for the future.
Mike:So you need to look at your yearly, I would say that the start of the year, just
Mike:look at your yearly income and come with yearly expenses and savings off the top.
Mike:So you want to target about that 15% to save for the future.
Mike:The mathematics I've gotten into this other podcast, just the
Mike:mathematics kind of work out.
Mike:If have a regular career, if you're saving 15%.
Mike:throughout time.
Mike:And so save that off top in your 401ks, your IRAs, your 4 0 3 BS, automatically
Mike:these away or into a brokerage account.
Mike:If you save off the top.
Mike:Then you can spend what's left over now.
Mike:Maybe you also need to save for a down payment for a home, or you to
Mike:save, up your emergency savings.
Mike:So figure out things, not only for your retirement or for later, but if
Mike:there's other things You need to save for maybe a travel budget, you like to
Mike:save, know ahead your travel budget, put together those 1, 2, 3, 4 items
Mike:you're saving for make them automatic.
Mike:So you're saving off the top straight from your income, then
Mike:everything else left in your checking your everyday checking account.
Mike:You can go ahead and spend that cuz you've already saved for future
Matt:What I like about this is that this is a shortcut that's of click above even.
Matt:All right.
Matt:What app do you use?
Matt:it's an inversion of the way.
Matt:I think most are forced to think about especially if if there's a stat out
Matt:there that gets very distorted, that 80% of Americans paycheck to paycheck.
Matt:paycheck.
Matt:And if you are in the mode, Where, you are pretty tightly balanced
Matt:what's coming in and what's going out.
Matt:Then the mindset that you have to adopt is all right, I'm going pay the bills
Matt:and then anything that's left over.
Matt:I will save.
Matt:But what you're saying is if have the ability to get a little bit ahead of
Matt:that maybe you've hit a phase of life where you're not in that mode as much,
Matt:and you can do a little bit of planning.
Matt:Then just the script, just start with, I'm gonna set this target savings and
Matt:I'm gonna automate it so that it happens.
Matt:And then I don't really need to worry about a budget.
Matt:And the easiest hack for the whole process.
Matt:If it applies to you, if you're able to do that
Mike:I also think.
Mike:You know you say, if you're able do that, I think everybody's able to do that.
Mike:you have to do Even if you don't have enough to save, then you know
Mike:that that's your awareness like.
Mike:Geez.
Mike:I'm really living a paycheck to paycheck.
Mike:There will be nothing at the bottom, but I would flip the script
Mike:and say what do you save first?
Mike:And this applies to business as Well, own business.
Mike:business It's like the a profit first mentality.
Mike:I.
Mike:wanna pay myself first, pay your future self first, pay yourself for your travel
Mike:budget, your emergency savings, your future self and save those things first.
Mike:And you will find ways to, make that happen because once it's gone and outta
Mike:your bank account, can't spend it , so you will find a way to make happen.
Mike:And look, if you're in the situation you really can't start super small,
Mike:with like 10 bucks a month, 20 bucks a month, whatever you can do
Mike:start just a tiny bit go from there.
Mike:But definitely look at that
Mike:first
Matt:I, I, what I like about that is that, I always advise people like
Matt:young people who are considering doing a sport or an activity in college and
Matt:they're, I don't really have the time.
Matt:actually what you find is that if you do something that you really
Matt:have to commit to, it's a major time commitment, effort, commitment.
Matt:It actually focuses in the rest of because you're forced
Matt:into that kind of discipline.
Matt:And so what you do is you make the commitment to, you know let's
Matt:you were a rower or whatever, and then whatever's left over.
Matt:That's the time you've got and you're gonna make it work
Matt:for the of your schoolwork.
Matt:All right.
Matt:But to the extent that you do use a tool, let's you you, do want
Matt:to dive in little bit further.
Matt:What do you use
Mike:All right.
Mike:So let's talk about budgeting?
Mike:apps.
Mike:I use one that's called Tivity, and this is for the Mac.
Mike:And I ran it quite a few years ago.
Mike:And I really like it now.
Mike:I've used it.
Mike:off and on Right.
Mike:now.
Mike:I'm not using it, but I have used it religiously for
Mike:tracking all of my expenses.
Mike:So every week I would download.
Mike:You know It would hook to my accounts that I it to.
Mike:This is again called Tivity and they have a it's for the Mac
Mike:and the iPad and the iPhone.
Mike:I think it's only apple products
Matt:Got it
Mike:And you know every week it would hook to my accounts that had set up either
Mike:my credit card, my checking account, pull down, you know what those latest.
Mike:Transactions were and I would categorize them.
Mike:So I'd spend my time categorizing every transaction.
Mike:And what I liked about it is they do have a budgeting tool, but I used it more for
Mike:reviewing my expenses monthly, quarterly, and definitely at the end of the year.
Mike:So I just aggregate all of my spending for the entire year
Mike:and see all the categories.
Mike:How much was I in each category and really what it's useful, or I
Mike:find it this is looking backwards.
Mike:, I'm not setting a budget.
Mike:I'll talk talk about some other tools where you set a budget, but
Mike:this one I'm looking backwards as what did I actually spend?
Mike:It's not related to having a particular budget in mind.
Mike:It's really categorizing on my past expenses.
Mike:What I like about that and for clients as well is building awareness.
Mike:Are you spending your money?
Mike:And how much money are you spending on those things?
Mike:And I always recommend don't get too granular with the categories I did.
Mike:I probably had 20 or 30, which is probably fine.
Mike:But you could go smaller than that.
Mike:You only want to have categories where you might make a change.
Mike:So If you're thinking well my dining out.
Mike:May, maybe I wanna make a change there.
Mike:So I want to track that if you're thinking your coffee shops uh maybe you know I get
Mike:the daily coffee I make a change there Well then have a category daily coffee.
Mike:If you're not changing your kids' tuition, then you can bucket
Mike:that with other kids' expenses.
Mike:I'm gonna buy my kids' clothes and tuition and other then put it all under kids.
Mike:You don't know need to break it out so granular because you're
Mike:not gonna make a change on it.
Mike:Anyway.
Mike:Okay.
Mike:So just that's what I like about those budgeting.
Mike:That it's a budgeting tool, but again, I'm not using it per se as
Mike:a budget, just for looking at past expenses and to build awareness.
Mike:So I use the tool called Tivity.
Matt:And it stood out me in what you just said is it's useful
Matt:under certain conditions, right?
Matt:Because your first piece advice still applies, which is, look, if
Matt:you can, you know focus on savings first and then that up alone.
Matt:Can take the place of a detailed budgeting process, which who
Matt:wants to get into all that.
Matt:But I do there's some value cuz I've done the same that you just described,
Matt:which is I've done a backwards look.
Matt:But with that really important caveat in mind of, I really
Matt:wanna focus in on the things.
Matt:That can change.
Matt:We've talked on this show before about the buddy tape principle, which
Matt:is, it's only worth doing something.
Matt:If it's going to change what you do in the future, right?
Matt:Like it's only worth evaluating something if you're gonna change behavior.
Matt:And know so for me, I've had that same thing.
Matt:Am I going to really change our grocery store budget?
Matt:I probably could.
Matt:I probably could, like we could spend a lot more time finding coupons.
Matt:We could, change the things we eat a little bit, but on the margin, we've
Matt:decided that I I think there's enough savings that we can find in that
Matt:category to make a huge difference.
Matt:In our overall financial picture, we could make a much bigger
Matt:difference if we said, you know what?
Matt:We are gonna really limit on, on entertainment.
Matt:We're gonna really limit, we're gonna have one streaming service
Matt:that would save us some money.
Matt:So I could see the value in an approach like this.
Matt:If you really stick with the caveat of like, where are the areas that
Matt:truly make a difference forward?
Mike:Yeah.
Mike:And the other point I'll raise about building awareness is that you may find
Mike:you are spending, isn't aligned with what's bringing you the most value.
Mike:So in your example of groceries and entertainment, you could say,
Mike:geez, maybe I can cut spending there cuz I don't really care if I have
Mike:rice or beans or like the greatest steak it doesn't bother me, whereas
Mike:my entertainment, no, no chance.
Mike:I'm cutting out those services.
Mike:I use all of 'em every night.
Mike:And I love it.
Mike:I to sit down with my partner and watch something and this is
Mike:perfect time so there's very clear where you wanna be spending money
Mike:and that's the awareness piece.
Mike:All right.
Mike:me mention some other apps, cuz they're really useful ones.
Mike:Mint.com is a very popular one.
Mike:I've used that in the past.
Mike:You can track your past expenses, but you can also set a budget.
Mike:And then expenses get automatically categorized into that budget.
Mike:So can see oh, I'm gonna spend 500 a month on groceries.
Mike:And as you spend it, it's tracking against that 500.
Mike:So towards the end of the month, can see how close you are, if
Mike:you're under or over on all the categories in terms your budget.
Mike:So that would really help you in making sure you stay within spending on
Mike:different
Matt:Yeah.
Matt:I've used mint a little bit a matter of fact, I stopped using
Matt:it and it's like quitting the gym.
Matt:I, they keep sending me and I can't like, and I'm like uh I should
Matt:keep it you know anyway, go on.
Matt:Yeah.
Matt:Mint.
Mike:You're still
Mike:paying
Matt:like I like them
Mike:Um
Matt:Well that's a place I could economize if I did but.
Mike:there you go.
Mike:that's great.
Mike:You should have a line item for that in your,
Matt:there's 72 bucks a year that I could do without
Mike:That's right.
Mike:So there's some other ones there I've tried also one called YAB.
Mike:You need a budget.
Mike:Y N a B.
Mike:YAB.
Mike:You need a budget.
Mike:And what this is based off the whole idea, the envelope system.
Mike:So the way the envelope system works is that you get your a paycheck, think of
Mike:actual cash, so you get your paycheck and you take it to the bank And now
Mike:you've got a thousand dollars of cash.
Mike:You cashed in and you have a thousand Dollar bills.
Mike:Then you eight or 10 different envelopes.
Mike:get the mortgage, you get the groceries.
Mike:You get the clothing, and you put some dollars into each of those envelopes.
Mike:So you put, $50 in here, $150 in this other envelope and $20 in this envelope.
Mike:And then as you go when you go out, dining out, you take your out envelope.
Mike:And you use the money from that.
Mike:Okay.
Mike:So in other words, you're taking your income and assigning every dollar, a job.
Mike:You're putting it into an envelope, but this dollar's for the mortgage.
Mike:This dollar's for dining out.
Mike:This dollar's for my entertainment cost.
Mike:And then when you have those B those bills expenses, you take
Mike:the money out of those envelopes.
Mike:So it's pre saving for all your expenses for your budget.
Mike:And That's how YAB works.
Mike:You assign every dollar, a job.
Mike:It's all digital of course.
Mike:Okay.
Mike:No actual envelopes, but you assign every dollar, a job.
Mike:And then as you take money out, it's automatically tracking all those budget
Matt:Well three things First all, I can already see that this conversation
Matt:is going to be a lot deeper and longer, and it gets into all these of things.
Matt:So I'm just gonna tell our listeners.
Matt:We are planning for this to be about a 20 minute conversation
Matt:to go onto the radio broadcast.
Matt:I'm gonna just go ahead and that like LeBron calling his own number on a play.
Matt:I'm gonna say, we're gonna turn this right now into a two part episode.
Matt:So we're gonna keep going with conversation Second of all, I love the
Matt:idea of stuffing money into envelopes.
Matt:It reminds me of everyone attending my Bartz.
Matt:And third of all, do think
Mike:How
Mike:How big
Mike:were those envelopes at
Matt:They were really small.
Matt:My bar mitzvah was you know what it was we could do.
Matt:It was what we could do.
Matt:It was nice for some reason all of my friends had heard about a tradition of
Matt:throwing candy As soon as you finish you know giving your bar speech um
Matt:you know throwing like hard candies little hard candies Um at the speech
Matt:giver like at their head And apparently this is a tradition that only applied
Matt:at my mitzvah I dunno It was weird.
Matt:Anyway, the point is we're way off track here One of the interesting
Matt:things about YAB is that it does kind connect to what we were saying a moment
Matt:ago is look, if you're in a position where you can set savings first.
Matt:you're in a tight budget situation let's say you're earlier in your
Matt:career, here a little bit younger.
Matt:It's not this app particularly good for you If you wanna impose little little
Matt:bit of that discipline on yourself and you have very specific like look it's
Matt:not like you wanna like sit in the dark you know doing absolutely nothing.
Matt:Like you have a little bit of money to spend but you just keep Pretty
Matt:tight control over it And this seems like a good system for that.
Mike:well I've found, it's interesting.
Mike:This one particular actually resonates with some people and and other
Mike:people totally don't understand it.
Mike:So I always recommend like check out the website, try it out.
Mike:Because for the people it resonates with, they just love it.
Mike:I know people that make.
Mike:Quite a bit of money that still use YAB.
Mike:Just because they want keep track.
Mike:It's so nice to be able to keep Where am I spending my money?
Mike:I said I only wanted to spend this amount on these categories, so I only
Mike:put those dollars in and they're gone for that month or whatever it is.
Mike:So It's a really unique
Mike:tool
Matt:Yeah It's like It's like the weight Watchers of budgeting right
Matt:It's like you so many points you know to use up on things, use it.
Matt:done And uh if it works for you is awesome Um alright And and there
Matt:were a couple others, I think you wanted to throw out from clients,
Matt:right
Mike:Yeah, So on the budgeting, just to round out the budgeting category
Mike:here which we can probably do some other ones I've heard of but I don't
Mike:have firsthand experience is simplify.
Mike:And that ends in an eye.
Mike:So simplify with an eye at the end, of It is the internet,
Mike:to spell things differently.
Mike:And then true bill, which does not have an E I believe T R
Mike:U
Mike:B I
Mike:L
Matt:you should only spell
Matt:things the way that they're spelled in modern life.
Matt:If you want people be able to find them, if you wanna say
Matt:mysterious you know call it
Matt:whatever like it's it's spelled with this Z Um
Mike:That's right with four Zs.
Mike:So those two are I've heard really good things about, cuz a lot
Mike:of people mint turns 'em off.
Mike:Oh, I tried make, cause that one's been around for a long time.
Mike:People have tried it and so they've kind of moved on to something else.
Mike:So those are a couple other ones check out.
Mike:True.
Mike:Bill, I think is pitched kind of a a bill payment system or
Mike:really keeping track of bills.
Mike:But I've heard it's really great for budgeting.
Mike:As well, and very simple and easy
Mike:to use So I've heard good
Matt:You know and before we um we're gonna have to wrap up um we're gonna have
Matt:to wrap up for a moment But in in just a moment is that another do is that another
Matt:to automate your clients to automate as many bill payments as that you you their
Matt:bank spending side you kind of have the spending side as preset as possible.
Mike:Yeah, I don't get into too much the bills per se, cuz most of
Mike:those are going, you know you when you set up these recurring things,
Mike:whether know an entertainment bill or something like that, it's always
Mike:just coming your credit card, right?
Mike:Like you just put in your credit number and it goes there.
Mike:What I do recommend and this is what you're getting.
Mike:at Is
Mike:Any of your credit cards when you set up credit cards or you have credit cards?
Mike:Make sure you have the auto pay feature turned on, pay your credit card off
Mike:every single month using an autopay feature to pay off the entire balance.
Mike:And if you're not there yet, if you can't do that focus on that first,
Mike:always get your credit card debt down.
Mike:First the interest is super high.
Mike:you're just building, more debt there's tons and tons of how to work on that.
Mike:So if you find yourself in situation, but for everyone everyone else.
Mike:Just make sure auto pay on.
Mike:You don't wanna miss a payment cuz that's easily 10, 20, 50 bucks that
Mike:you're just paying an interest.
Mike:just from missing you know
Matt:All right we're gonna break here for radio gonna break here and we're
Matt:gonna be right back be right back Mike Morton with Mike Morton or even next week.
Matt:If you're listening
Mike:That's right.
Mike:Thanks.
Mike:Thanks for joining us on financial planning for entrepreneurs.
Mike:If you like, what you heard, please subscribe to and rate the podcast on
Mike:Apple iTunes, Google play Spotify, or wherever you get your podcasts.
Mike:You can connect with me on linkedin or mortonfinancialadvice.com.
Mike:I'd love to get your feedback.
Mike:If you have a comment or question, please email me at
Mike:.
