The Anti-Budget System We Wish Everyone Knew (Money Talk Replay with Skyler Fleming)

0:07Do you make good money but have nothing to show for it? Are you tired of living paycheck to paycheck? Do you have big dreams for your financial future? Do you want to get debt free, but you don't want to live on beans and rice? Or you don't want to give up those pumpkin spice lattes? Hey, it's okay if you don't already know how to budget or if you're using credit cards to get through the month. Hey, it's okay if you want to seem like you have your finances all together. or you're not on the same page with your spouse when it comes to finances. We know what you're doing probably isn't working, but guess what?

0:36You're in the right place. We're Shana and Vanessa. We're best friends, business partners, and master financial coaches trained by Dave Ramsey. We've been in business since 2019, helping hundreds of amazing people like you create budgets, get out of debt, stop living paycheck to paycheck, and know exactly what to do with their money. In this podcast, we'll share with you everything we know plus everything we're working on with our clients so that you have the best chance at reaching your financial goals. We want to help you take the guesswork out of your budget, improve your marriages, and even bring your kids in on the conversation.

1:08We can help you no matter where you're at, whether you're the single mom who's never had$500 in her savings account or the millionaire who's paid off four real estate mortgages. And we're not going to shy away from the tough love. We'll tell you what you need to hear and encourage you at the same time. This is the Financial Coaching for Women podcast. Hey, thank you for having us. We are here to talk about the B word. Yes. Thanks for having us. The B word is our thing. Yeah. Budgets can be a scary thing. And we're going to talk about some automation in that realm as well. I'm super excited for this one because automation comes up on every episode.

1:41Someone will always mention it and say, well, if you automate your savings or if you automate your investing, it really touches every area possible. So I'm excited to do a deep dive and it's been a long time since I've done an episode that had two guests. So I'm also excited for that because those ones are even a little more fun because we can go around on some of these topics. But let's kick it off here with what is financial automation just at a super simple level to define it. We like to say make your bank a personal assistant. Financial automation is making your budget come alive and happen and do without you manually having to do anything.

2:12I think a lot of people forget that those options are available. Those tools are there for you to use. And so we just want to take advantage of the tools that are already are there. A lot of people think they need third-party apps to make this happen. You won't name any of them, but there are a lot out there that make you think you need them to track expenses and do all this. And we are actually very much against tracking your expenses because the way we set up our systems and automation, you don't need any of that. Nor do we have the time to sit there and track everything. Yeah. Who wants to have a billion different apps when every single credit card company has the pay, the statement balance, pay in full as an automation option that you can just simply do through their system, or you can set up bill pays and things like that.

2:50We'll get into the nitty gritty of automating some of these things. But how do you two use automation in your finances? Vanessa, let's start with you. So my husband gets paid weekly. And when Shane and I first came together to start a business, it was like she was doing her business, her finances a certain way. And I was doing them the exact same way. We had no idea. And what we realized is that we actually have a system here. So my husband gets paid weekly on Wednesdays. And then every Thursday morning, all the transfers happen. All the automation happens. And I didn't do anything. I set up my budget to be able to tell me what I'm supposed to put where and when.

3:23And then I set up the automations to make that happen. And like my front, my grocery money is funded. My personal money is funded, all of that. I didn't have to do anything because we set up those reoccurring automatic transfers. Yeah. And the other part of that is the bills. So the way that we, the system that we want you to do is all of your income comes into one account. We call it the bills account. It's a completely separate account. Eventually some of that money will transfer to your different spending accounts and your different savings buckets accounts. but for the most part, most of that, depending on how many bills you have, will stay in that bills account.

3:52All your bills will be paid automatically. Automatically. This is tough for people, but we show them like, this is what your budget looks like. Once you get comfortable knowing the numbers are going to, the math is going to match, then all of those bills can come out automatically. And that's one of the best parts. There are very rare bills that you have to pay manually, but for the most part, you can set them up automatically. So really your bills get paid automatically. Your spending is funded automatically. Your savings are adding up automatically. A lot of times, the only part of your monthly budget that you have to do are some of those manual one-time things like this month, it'll be maybe it'd be graduation present or Father's Day where you've budgeted for it, but you have to get that money separate because it's not something that happens every month.

4:31But otherwise, almost all, every single part of your budget can be automatic. Yeah, that's fantastic. You mentioned the hard part can be paying those bills automatically. Even for me, I've been doing this podcast for three and a half years. And I think I've only been paying my credit cards automatically for four months. It was just that one hurdle that every first of the month, I could not get myself to step away from sending the full balance myself through, but I was typing it in every month. You know what? I'm going to try it with one card just to see how it works. And then I did it now. I don't even really look at them.

4:59I just take note of all the numbers as those emails come in. And then at the beginning of the month, I make sure there's that much in the checking and then it just does its magic. Have an alert set up that if it goes below a certain balance, we're good. Other than that, you don't have to check it a whole lot. And I think that's the freedom point that automation can get you to. I think a lot of people don't trust their bank account yet. So I think we get people to a point to where it actually doesn't matter when you get paid. So the way that we have your system set up, we want you to be a paycheck ahead.

5:24And the money is coming into the bills account and bills are getting paid. Shana said your spending accounts are being funded. Your savings accounts are adding up. All that is just happening. People are stuck in this paycheck to paycheck cycle. This paycheck pays these bills. This other paycheck actually allows us to buy groceries and so on and so forth. And so they're stuck in that mindset of every two weeks instead of actually seeing what your money can do for you in the entire month. I just want to caveat that one little bit that you said, Skylar. So part of what was making you maybe not want to commit to paying it necessarily every time is that the amount changed.

5:57We actually look at what you're spending on your credit cards and we try to put that in your budget. So sometimes people are using credit cards because they want points, which is fine, but We don't necessarily do that. But what we look at is, okay, you're using it for groceries because you get 5 % on that or you're using it for, and so we want to put that into your spending budget. But if you're using a credit card, you then still should set yourself a budget because it's very easy to just, so you might have a$5 ,000 limit. I would still say set a budget to what you're spending on your credit card.

6:22That way it can be regular. It's the irregularity of sometimes I went crazy this month and I don't know if I'm going to have the money. So make sure if you're going to be one of those, it's paying off your credit card every month. maybe you use it just for groceries and you have a thousand dollar grocery budget and then it just automatically comes out free and you can count on that specific amount yeah that's a great point if you can manage to keep it consistent it's always right around two to three thousand and it's a whole lot less stressful and like you said you don't know my credit card limits i don't even know if i know them because that's not the number that i base my spending on like you said it's all about building a budget before it gets to the credit card i think there's one credit card that my wife and i got recently that they gave us like a thirteen thousand dollar limit and i'm like why do I need that much?

7:00I could buy that much stuff. I'm sure I could, but you don't need that much. They want you to. That's their goal. Yeah. If I was getting 28 % investment return on some sort of interest rate, I would be pouring all my money into that just like they do. Very good point. Yep. So when you flip it on its head like that, and you think of that interest rate as their investment rate of return, you see why they market them so heavily. You just want to become a credit card company and make that kind of return? Yeah. We heard the amount of money that they have in their marketing budget every year to be able to get you to all the points and all the stuff.

7:30It's more money than we'll make in a lifetime, right? So it's like, they are good at this game. It's game that we're not going to win at is we're going to do it the right way. And like Shana said, this is how much you have for bills. You're going to put that in your bills account. If you're wanting to put it all in your credit card, that's fine. But you're going to take the money that you put in your bills account for those bills, pay the credit card. If you have a spending account for gas and groceries, we're going to put the amount of money in there that you said you're going to spend. And when the credit card bill comes, you're going to take that money and put it towards the credit card bills.

7:57That way you know you're still staying within budget. Yeah. And then one more quick thing. One thing that we like to think about is if you can, if you want to think about weaning yourself off of credit cards, not you specifically, but maybe some of your listeners, what rate of return could you get in a high yield money market if you were saving your own money? So a lot of times people use them maybe for vacation or different big things like that. If you have your own savings bucket, like I know you guys went to Hawaii and you're saving all that money, maybe it's in a high yield money market or high yield savings.

8:26Maybe you can make more than your points swiping for your points would. And then you can slowly eliminate the need for credit cards. The real thing about the credit card is it makes you behind. Like you were saying, like I have this 2000 and you can probably, if you really want, win that game, be ahead of them. But again, sometimes people just haven't thought about it that way. I want to go back to where Shana said you're a month behind because you're racking up like charges and then you pay it at the end. So you're literally a month behind on everything. And we have actually seen a lot of our clients who wean themselves off credit cards.

8:59The reason for that is because we don't want them to rely on credit cards, which is what a lot of people are doing. And you recently had a podcast guest interview and he was basically saying, when you are relying on credit cards, that's you're using it as a strategic system that takes some intentionality and that takes some advanced level of, of, of systemization. But when we're talking about just using credit cards every single day because you don't know because you don't know or you don't know if you can even use your regular bank account that's where the problems come into place and that's where you can really get into some trouble with your debts want you to be in control and what if you actually like shana said had the money in a high yield savings account you're making four percent on your money sitting there whereas a credit card you may be making one two three three percent back on some of it yeah and then some of it if you're paying any credit card debt with an interest rate it's not worth it at all if that conversation we just had is overwhelming you at all or you're feeling some sort of anxiety or you're getting jittery about credit cards, just avoid them completely.

9:51You don't have to live life with credit cards. It's not a requirement. Let's move back into automation. I love a good detour on credit cards because they're a real topic that plagues so many people. But also automation can seem pretty overwhelming. Why does it seem overwhelming for people? I think the main point here is because they feel less in control because they don't trust their bank account. So they feel like they're not in control of it when they set it up. I don't think they've ever done it the right way. She says trust their bank account, a lot of times it's they don't trust themselves.

10:18So part of our automation that we want you to do is have separate accounts so that you can have your money in a separate spending account so that you can always very clearly see how much you have to spend. And that will help you to feel trust with your bank account and yourself, because all you have to do is not spend money in the bills account. Live over here in that spending account. And it doesn't matter. None of your bills will get affected if you have separate accounts. So that, I think, automation seems daunting. Like Vanessa, that people want to be quote unquote in control because they know they don't necessarily trust themselves to always have the money or to not spend too much.

10:52But the other thing that I think is daunting to people is when we tell them we want them to open up these separate accounts so that it can be, they're like, wait a minute, that seems harder. But actually the truth is one bank account with everything going on inside of it, so many millions of transactions, that is actually what's daunting to me. Trying to scroll, did the rent get paid so I can go to Target or Starbucks. No, let's not do that. One account that's only our bill, very easy to see. It's very easy to manage. And then I can do the same. If I have a spending account, I don't have to track.

11:22I can just look in there and be like, look, girl, you got a hundred dollars to get through till next payday. Have at it. Like just go a while for a hundred dollars. You don't have to literally look or think about anything else. Yeah. That whole system is your income comes in the bills account. And then from your bills account, it goes to your spending account. And then the other money goes to your savings account. And it's actually that simple. And it's funny because we've had usually the husbands that are like, because their wife will find our podcast and they're like, babe, these women talked about having multiple spending accounts.

11:50So that way it's very organized and it's separate from the bills. And usually the husbands are like, hold on, I can barely manage the one. Am I going to have a couple? But they're the ones that come to us like two months later. And they say, this is the most organized, easiest system I've ever had. And I'm so accountable to knowing exactly how much we have to spend as a family versus having to try to have one account where, like Shana said, a million transactions are going through, four people are using it, rents coming out, targets coming out, vacation money is coming out. That is more confusing and more hectic for them.

12:23Yeah, I believe it. I've tried this out with my sister where she has a separate savings and checking. We're going to get into direct deposit because I think it's an underutilized tool. If you're sending your direct deposit straight to your checking account with a debit card attached, you're seeing your entire paycheck as that spending amount. But if you can route it just a little bit more carefully, then yeah, who cares how much you spend if that money is dedicated to spending? It's a little bit of an anti-budget approach almost as well. Like that term has been out there and I've done podcast episodes on it where you give yourself the amount to spend and then you just spend it.

12:53Instead of getting more granular with it, you just put it aside and then you're okay with spending it. And I think that can be powerful for people. It's in a similar vein of making sure your spending is your spending. And that's all you're worried about. We love it because we speak to women mainly, but it's bougie on a budget. Like the idea of being able to spend your money and have it. A lot of people don't think that spending should be in your budget or they don't think it can be, but we want it to be put it in there and just put it separate. So that way you can spend, but also know over here in that bills account, everything is being funded and you don't have to worry about it.

13:25Yeah. I love that. I have not really heard that. I think I've heard it once, but I never, it never sunk in the anti-budget. So we're really like super popular and trendy because we are teaching anti-budget. I didn't even think about that, but you're right. What we do say is the spending is where you live in your budget. And to your point, if you set up all the systems, direct deposit automation, all you have to do is live in that spending account. You don't have to do any other budgeting. You do have to know how much you can allocate to that and have the spending, but that's all in front end. And then if you get this front end system set up, there's no more work to do.

13:54Like you just have to spend money. Oh no, how will I do it? I think what you said, you don't have to get in the nitty gritty of this, how much I'm going to spend on target this month. This is how much I'm going to spend on Amazon. This is no, it's how much do you want to spend this month? Okay. Literally you just want one account that has gas groceries and spending money and you know, out to eat. If you have everything in there, that's fine. How much do you want that to be? Take that amount of money, take it out of your bills account, put it in a separate spending account. And that's your budget.

14:21Like you said, we like to say, it's what you do with your hands. You have the anti budget. We like to say, no, this is actually what you can do. And don't worry about tracking the nitty gritty part of where every single penny went. Nobody cares. And nobody has time to track that, that it's separate from your bills. You have to be a finance nerd like me to track all that, which I do. I love my spreadsheets and things like that. But most people don't. Most people are listening to these podcasts to figure out what can I do that's actually going to help me because they don't want to download another app and sign up for a year subscription.

14:51There's so many things out there that are just trying to suck money away from us. I love this system. You separate it out and you're okay. If that account has a positive dollar number in it, you're fine because all your bills were paid. You're not hoping the rent cleared because that's the worst case scenario where there's a holiday and a weekend. Your rent is coming out five days later, but you had a fun weekend spending money and then it doesn't clear and there's a whole bunch of mess because you don't have it separated. How has this automation system for either of you been a superpower in terms of managing your finances?

15:20Part of it, honestly, this may be speaking to women, but no one has money for food. I know that's going to sound really silly, but when you're talking about what you just said, a whole long weekend, we had fun, we paid the bills, and then there's no food for people to eat this week because I don't have any money left over. I'm on E on the gas tank and I can't really get any more gas. So that is a superpower because there's money. And listen, we're going to blow your audience mind a little bit more. We don't want just one spending account. We want several. So we have all of our clients set up a gas and groceries account.

15:49So think about this, whatever amount you've budgeted for gas and groceries, you're going to put it into a separate spending account. So you, again, just like you just said, Skylar, I know the bills are paid. I know I have money to go to Starbucks or wherever you men folk like to go. And then I also know I have money to buy food for my family and get gas in my tank. And they're all separate. I know that one doesn't mess up the other. I just have to live within the amounts. And so your budget comes alive. Your budget is literally reflected in your bank accounts. I also think one of the superpowers in all of this is that it is funding your personal spending and that is separate as well.

16:25So a lot of our spouses want to spend money as they should because they make good money and they deserve to be able to go out and spend money on themselves, but they don't know how much they can spend. Or it's the husband messaging the wife, hey, can I go out and buy this? And the wife is telling him yes or no. It becomes like this parent relationship. It's very unhealthy. So what we tell them to do is open up, no, you as the wife gets your own spending account with the debit card left. And then the husband also gets his own checking account with the debit card. That way he can buy fishing, hunting, gaming, things that he wants.

16:56And there is a no judgment on how either one of them spends their money, but they each get their own money to spend freely. And it doesn't affect gas and groceries. It doesn't affect the bills. It doesn't affect their savings accounts. It's all very organized and automated. This is something that our clients absolutely appreciate and they love when they set it up. All right, budget besties, it's time for some real talk. You don't need another budget. You need a budget system. Our simplified budget system is what you've been looking for. It's going to allow you to be bougie on a budget. You'll be able to easily set up a system that runs automatically and shows you exactly where your money is going.

17:34And it's going to give you permission to spend. Everybody loves that. Yeah, it's straightforward, pretty, and packed with walkthrough videos that break down the exact methods we use with our clients to get out of debt, set up a bills account, separate spending, build savings buckets, and end the paycheck-to-paycheck feel. If you're new to budgeting, this is the perfect way to jump in. And if you're already a budget nerd like us, you're about to meet your new obsession. This is the upgrade to your finances that you need right now. Yeah, so head on over to budgetbesties.com forward slash budget and grab yours.

18:07Now back to today's show. One more superpower, Skylar, which I heard you having a guest talking about this as well with the savings buckets. One thing our clients love is they open up their bank app and their savings buckets are growing and they didn't do anything. We just see them growing and it's like they've almost gamified it. Every pay a little bit more goes into grows. And then to our point earlier, hopefully it's making you some money as well. Like that is a superpower. And if you have it separate, so many times we'll pull from savings to get through the month. a lot of times. And you've talked about it before.

18:38That's why we want to have savings buckets with a purpose, not just I'm generally saving money. There's no anything there. But if you're putting money in there purposefully, we actually have you rename the account. So you had Hawaii. Yes, that's huge. Having a name on it and a purpose is a big deal. And you're less likely to steal. Yeah, you're less. We had a client, she was saving for her daughter's wedding. And we're like, you're not going to steal from that one. If you name it, you're less likely to steal from it. So that's another superpower. are. That's a big one too, because you both, you mentioned something there.

19:06And I think the reason this episode, it's been honestly a revelation for me because you're making something that I've talked about practical for people in terms of actually having these separate accounts. Because like I said, I'm this nerd with our spreadsheet. We have our sinking funds or buckets or whatever you like to call them labeled out on different line items on the spreadsheet. And that's nice for me because I can, I'm a data driven person and it's easy for me to see that. But when you have it in separate accounts, it is so much easier for someone to, you pull up your app, you log into that separate account and your wife or your husband is able to say, wow, I have this much to spend.

19:37And my wife and I, we have those separate accounts and it works for us because that's just the way we've set up our system. But I love this simplicity that separate accounts brings when you're not having to both sit there and you're like finding the lines and on the spreadsheet and trying to nail it down. I think that's a big one for people. For sure. And I love what you said, because it's actually something that we say as well is separate to simplify. And people believe that if you have more accounts, it's going to be more unorganized or easier, more complicated and harder to track. But actually we're just taking the concept of cash envelope system and turning it digital, right?

20:09We've had people that are like, oh, I'm just going to have one savings account and then use a spreadsheet and then tell me exactly how much is going to think. So whether it's wedding or travel or vehicle maintenance, home repairs or whatever. And I'm like, we're going to tell you right now, that's not going of work. I don't know what the resistance is that some people have at multiple accounts. I absolutely love it. It brings me so much joy to open up my bank account and see how much I have for my kids' education, how much we have for vehicle maintenance and all. There is no question. I don't have to do math on a separate spreadsheet.

20:38It's right there already done for me in my bank app. So the idea of having those separate, being able to visually see where your money is and why, that is it's just really freeing yeah yeah i believe it and i'm realizing more and more as this goes on that i'm crazy with the system that i use because you guys are just painting it in such a more simple picture even though they're very similar like the spreadsheet with everything broken down but my wife i'm sure could count it would take multiple hands on to count the number of hours i've spent fixing the spreadsheet because a number breaks i put a minus where a plus should be and then i'm like oh shoot do we actually have this much money no let me go do all the math for the last month's transactions.