12 ms·

This is the most absurd thing I've read in the last couple months. If you're trying to troll, 10/10.

vinceguidry 10y ago
Wasn't trying to troll. I was serious enough once about personal accounting that I built my own web app because I thought the standard double-entry system wasn't really suited to the task. After I got the basic system tweaked to my satisfaction, I used it for several months. I started to take it to the next level, but had the curious realization that I cared more for the process of developing the app than I did for actually tracking my finances. Eventually I gave it up, and went out and got a better job where I'm more fulfilled professionally and way better paid. I learned then that working on the app was substituting for professional fulfillment and vowed never to let that happen again. Tracking cash inflows and outflows is an essential business skill. But a business is a machine, and people are not. Personal productivity does not respond well to wringing unit economics out of daily activities. If your goal is to turn yourself into a machine, by all means use a mechanistic approach. But we are meant to build machines, not to be them.
- CorvusCrypto 10y ago
  I can see being more lackadaisical about personal accounting on 30k/year, but when you make 15k/yr you need a budget and you need to track your expenses to survive. I think this is just something that varies from person to person, but it's nice to know that you spent X amount on groceries per week versus Y amount on gas so you can pinpoint what is hitting you most during times of dire financial stress to optimize.
  - vinceguidry 10y ago
    When I made that much, I didn't bother with a budget or accounting either, I knew to the nearest $5 how much I had in my pocket and my bank account at all times. Writing down that which I already carefully tracked in my head wouldn't have accomplished anything. What you're missing is that at that level, what you can get through spending money is going to be vastly dwarfed by what you can get through ingenuity. My response to a bigger electric bill in the winter wasn't to save money on food, it was to shut my heat off, build an enclosure around my desk and heat it with a small space heater.
    - CorvusCrypto 10y ago
      It's awesome that worked for you. I'm not that smart so for me, budgeting and tracking my expenses by category helped me become comfortable enough to spend more time on freelancing and job seeking. I won't say your way doesn't work, because you are a testament that it does, but I don't think I could have taken this approach and gotten to where I am now.
    - duaneb 10y ago
      You were effectively budgeting in your head. Good for you. Can everyone match your skill? Who knows. I guess no. I cannot budget this well. It is not that I do not know my level of cash, it is just that I cannot accurately estimate my spending rate and I almost always spend too much for the month. Best of luck.
    - nommm-nommm 10y ago
      So because you are smart enough to do this in your head you think people who do the exact same thing as you just writing it down instead of doing it in their head are wasting their time? That's pretty silly.
- freditup 10y ago
  Don't know why people are downvoting you, your comment was grey when I read it. I see nothing that makes your comment invalid and I think it contributes to the conversation. Perhaps it's not the popular opinion, but in a lot of cases I agree with you. Watching over every penny meticulously can become a much too consuming habit that produces little net positive result. It's easy (at least for me) to get caught up in trying to never waste money, and it's really not worth it.
  - themodelplumber 10y ago
    It's a mix of different issues going on in that comment: - Some kind of perfectionistic NIH accounting system is probably not what people have in mind when they talk about this personal finance accounting being useful - The project details seemed to overcome the initial scope - Rather than addressing the need for a more elegant framework for personal accounting, OP decided to just make more money, and for all we know has discarded personal financial accounting - We know not what kind of blind spots this may have created (for real: You are absolutely discarding a level of granularity and the freedom to find a way to make use of it) - While we can trust that OP will probably be fine, we are left to wonder if it's really so great to tell people not to do this kind of accounting when you kind of turned it into a hyperbolic mess when you implemented it yourself.
    - vinceguidry 10y ago
      The project wasn't perfectionistic, I specifically designed it to be as easy to add and look at what I was spending as possible. Instead of putting spending into accounts, I used simple categories. I had a dashboard view that gave me exactly the window into my finances I was looking for. It was good enough for my purposes. But I kept running into situations that called for extended customization. Sure I could have extended the app to account for temporary changes in how I wanted to do things. But it just kinda stopped making sense after awhile. It made me look into how I managed my finances before I ever did accounting more closely. What I found was that I never really got into the sort of mindless spending habits that kill most people. Accounting was, in essence, a unnecessary addition to an app that was already working just fine. It didn't buy me much when I was doing it, and I didn't miss it when it went away. My life just isn't that complicated. Similarly, I've never needed productivity software other than, on very rare occasions when I'm super busy, a pad of paper and a pen. And I was a GTD zealot 8 years ago. My advice in my original comment was tailored towards people who plan on being upwardly mobile. If that's what you want to do, then personal finance is a waste of time. Ramit Sethi's advice is the best, chase big wins, automate your finances, and don't stress out over small repeated expenses. If you've hit a career plateau and don't see yourself making more money anytime soon, then by all means make the most of what you have. But c'mon, this is Hacker News. We can all be upwardly mobile here if we want to be.
- duaneb 10y ago
  This makes sense if you can move upward. Obviously not everyone can. For these people, this advice is toxic and life destroying.
  - zo1 10y ago
    The vast majority of people can improve their prospective in life. At the very least they can be more efficient so they can spend more time with their kids; That way the kids have a better life than their parents. Though, to be fair, I think they should do both. Budgeting/finance is an incredibly important skill for all but the richest levels of society.
    - duaneb 10y ago
      Quality of life seems to increase monotonically in the states. The relative social status does not, on average. Considering happiness seems more based on the latter, this seems to be intractable.
      - softawre 10y ago
        Happiness is based on how well you are off compared to others? I mean, this is incredibly sad. But it's true, for some, I guess. This is why those who are making 15$/hour don't want the minimum wage to go to 15$/hour - even if they think they'll get a small bump to compensate.
- prawn 10y ago
  You're comparing life as a bootstrapper to a paid job more than life with accounting support of some sort to without. Further, there's no reason you can't do both. I don't account for my personal finances in any way, but I don't spend a lot on silly things. I do however use an app (http://streaksapp.com http://streaksapp.com) to push me. Without that, I'd be more inclined to take the easier or lazier options. We can account for our time and progress even if we don't do it for finances.
- maaarghk 10y ago
  You may have noticed that the article suggests using a tool, `hledger`, rather than creating your own accountancy software. Infact, based on your comment that you found the standard system isn't suited for the task, it's possible that your disdain for personal accounting comes from a lack of understanding of how to do it correctly.
- tomrod 10y ago
  I take the mechanistic approach to my personal finances, and treat them like business finances basically. It's a resource to be used, not a status symbol to be hoarded. Life has been wonderful as a result! I do keep a budget and keep track of things.
- jimbokun 10y ago
  Then don't work on an app for budgeting, just budget. You seem to think keeping a budget is some onerous, never ending task. In reality, probably spending about half an hour per paycheck is fine, once you have a system in place. And it certainly does not require a ton of technology, either. People budgeted just fine long before personal computers (lookup "envelope budgeting"). You are conflating two unrelated things. Spending a lot of time writing a budget app may have been a mistake. But you don't have to write your own app in order to budget.
  - afarrell 10y ago
    Having spent a bunch of time with GnuCash, YNAB, and budgetsimple, I've given up trying to have a formal budget. Instead, my wife and I just spend 20 minutes every 2 weeks looking at our accounts and talking about any big expenses that we have coming up.
    - jldugger 10y ago
      I don't know that you're asking for it, but I'll share my approach. I use GNUCash for transaction recording, and I have two levels of budgeting: Level 1: next 30 days. I have a couple dozen recurring transactions, generated 90 days out. If, based on the current balance plus expenses 30 days out, my checking account is projected to go negative, I do something about it. Otherwise, I think about shifting some money into higher interest savings, since I don't need it in checking. And if savings exceeds my emergency fund definition, additional Roth IRA contributions may be in order. The end result is that reducing float in checking can end up with a pretty high return. Frequency: Once a month. Level 2: Annual Budget. At a high level, I use a simple spreadsheet to budget all income for the year into savings and expenses. It's complexity has grown over the past six years to calculate things like income taxes, so I can compare job offers in other locations and states. I also use it to verify my very high retirement savings rates are viable. Because more savings contributions -> less taxes -> more contributions etc., a spreadsheet lets me "solve" for maximal savings. It also lets me target expensive areas, like rent, or dropping cable, phone plans, etc. Frequency: Once a year.
  - deleted 10y ago
    [deleted]
iamcreasy 10y ago
Would you please explain why this is absurd?
nommm-nommm 10y ago
Hacker news readers often live in a bubble that is well insulated from the outside world. A world where everyone is very smart and money and opportunities are a dime a dozen. Overspending is very easy for the average person. I know someone making 80,000/yr who has basically no assets and are living paycheck to paycheck and always complaining how poor she is. If you are living paycheck to paycheck on $50k you tend to live paycheck to paycheck on $100k. Adding additional income does not help these people - also see The Two Income Trap. Finding out where your money is going is good for everyone. Budgeting (even if informality) is good for everyone. Finding out where your money really goes is really eye opening for many. Realizing that a reduction in income probably requires a reduction in spending/lifestyle. Realizing you aren't "entitled" to the things you want by virtue of birth, you have to have the money to afford them. This may seem obvious to some but in the world of advertising and media it isn't to many. The criticism of personal finance or "frugality" here and in general comes in where people become obsessed with not spending money in the long term+. When every choice is optimized for spending less and one cannot enjoy anything with becoming guilty they are spending money. They put too much effort into pinching every penny and lose sight of the bigger picture. It's easy to hate on these people. This group is the loudest, unfortunately. Personal finance should be all about optimizing money for maximum enjoyment and financial stability. Realizing money is a scarce resource and optimizing it, which can include working on obtaining more depending on your situation. Budgeting in for the things you enjoy, within your means, and saying "no" to more things that won't bring you long term happiness. Realizing the difference between needs and wants. It's trivial to do this for many, and it is natural, but difficult for many as well. I think personal finance is just as much psychology as it is math. + Being obsessed with not spending money (OK, not obsessed but making it a priority) can be good in the short term for several month in some cases. Examples are taking a break from consumption or working to pay off high interest debt. Of course one should consider all their options in this situation - including, say, adding additional income short term if possible.
- vinceguidry 10y ago
  > Hacker news readers often live in a bubble that is well insulated from the outside world. A world where everyone is very smart and money and opportunities are a dime a dozen. I was speaking specifically for that audience and not for the broader one. Of course my way of dealing with money only works for people like me. I refer specifically to the "upwardly mobile", which is generally taken to mean those who make more than the average and are still capable of climbing the social ladder. When you are climbing the social ladder, you develop skills that make you more useful to people. When you learn accounting, you are learning a skill that will keep you from shooting yourself in the foot financially. It will not make you much more useful to others except in that regard. Sure you can get a job accounting, or use it to help run a business, but the benefits are too limited to justify doing it yourself. Hire somebody and use the time saved to learn something more useful. I never intended to say that people should not have a handle on their spending. Accounting / budgeting is one mindset that will give you such a handle but not the only one.
e15ctr0n 10y ago
Counting your pennies will not make your pennies grow. Only increasing your income will increase your income. This may seem like a radical idea at first, but look around you and you will find everyone understands this fundamental truth. Teenagers take summer jobs to earn extra pocket money. Housewives run home-based businesses on eBay / Amazon / Etsy to supplement the household income. People with full time jobs work part-time jobs before or after their main gig. Some people buy property and get rental income out of it. Those who are an authority on a given subject write books and earn royalty on book sales. The ultra-wealthy get dividend income from their stock market investments. None of these people belong in the HN bubble. Read any number of HN discussions on side-projects and you will see a wealth of ideas being put into action: https://hn.algolia.com/?query=sideprojects&sort=byPopularity&dateRange=pastYear&type=story https://hn.algolia.com/?query=sideprojects&sort=byPopularity... @vinceguidry is right. Invest in yourself and enjoy the payback in increased income.

Wasn't trying to troll. I was serious enough once about personal accounting that I built my own web app because I thought the standard double-entry system wasn't really suited to the task. After I got the basic system tweaked to my satisfaction, I used it for several months. I started to take it to the next level, but had the curious realization that I cared more for the process of developing the app than I did for actually tracking my finances. Eventually I gave it up, and went out and got a better job where I'm more fulfilled professionally and way better paid. I learned then that working on the app was substituting for professional fulfillment and vowed never to let that happen again. Tracking cash inflows and outflows is an essential business skill. But a business is a machine, and people are not. Personal productivity does not respond well to wringing unit economics out of daily activities. If your goal is to turn yourself into a machine, by all means use a mechanistic approach. But we are meant to build machines, not to be them.

CorvusCrypto 10y ago
I can see being more lackadaisical about personal accounting on 30k/year, but when you make 15k/yr you need a budget and you need to track your expenses to survive. I think this is just something that varies from person to person, but it's nice to know that you spent X amount on groceries per week versus Y amount on gas so you can pinpoint what is hitting you most during times of dire financial stress to optimize.
- vinceguidry 10y ago
  When I made that much, I didn't bother with a budget or accounting either, I knew to the nearest $5 how much I had in my pocket and my bank account at all times. Writing down that which I already carefully tracked in my head wouldn't have accomplished anything. What you're missing is that at that level, what you can get through spending money is going to be vastly dwarfed by what you can get through ingenuity. My response to a bigger electric bill in the winter wasn't to save money on food, it was to shut my heat off, build an enclosure around my desk and heat it with a small space heater.
  - CorvusCrypto 10y ago
    It's awesome that worked for you. I'm not that smart so for me, budgeting and tracking my expenses by category helped me become comfortable enough to spend more time on freelancing and job seeking. I won't say your way doesn't work, because you are a testament that it does, but I don't think I could have taken this approach and gotten to where I am now.
  - duaneb 10y ago
    You were effectively budgeting in your head. Good for you. Can everyone match your skill? Who knows. I guess no. I cannot budget this well. It is not that I do not know my level of cash, it is just that I cannot accurately estimate my spending rate and I almost always spend too much for the month. Best of luck.
  - nommm-nommm 10y ago
    So because you are smart enough to do this in your head you think people who do the exact same thing as you just writing it down instead of doing it in their head are wasting their time? That's pretty silly.
freditup 10y ago
Don't know why people are downvoting you, your comment was grey when I read it. I see nothing that makes your comment invalid and I think it contributes to the conversation. Perhaps it's not the popular opinion, but in a lot of cases I agree with you. Watching over every penny meticulously can become a much too consuming habit that produces little net positive result. It's easy (at least for me) to get caught up in trying to never waste money, and it's really not worth it.
- themodelplumber 10y ago
  It's a mix of different issues going on in that comment: - Some kind of perfectionistic NIH accounting system is probably not what people have in mind when they talk about this personal finance accounting being useful - The project details seemed to overcome the initial scope - Rather than addressing the need for a more elegant framework for personal accounting, OP decided to just make more money, and for all we know has discarded personal financial accounting - We know not what kind of blind spots this may have created (for real: You are absolutely discarding a level of granularity and the freedom to find a way to make use of it) - While we can trust that OP will probably be fine, we are left to wonder if it's really so great to tell people not to do this kind of accounting when you kind of turned it into a hyperbolic mess when you implemented it yourself.
  - vinceguidry 10y ago
    The project wasn't perfectionistic, I specifically designed it to be as easy to add and look at what I was spending as possible. Instead of putting spending into accounts, I used simple categories. I had a dashboard view that gave me exactly the window into my finances I was looking for. It was good enough for my purposes. But I kept running into situations that called for extended customization. Sure I could have extended the app to account for temporary changes in how I wanted to do things. But it just kinda stopped making sense after awhile. It made me look into how I managed my finances before I ever did accounting more closely. What I found was that I never really got into the sort of mindless spending habits that kill most people. Accounting was, in essence, a unnecessary addition to an app that was already working just fine. It didn't buy me much when I was doing it, and I didn't miss it when it went away. My life just isn't that complicated. Similarly, I've never needed productivity software other than, on very rare occasions when I'm super busy, a pad of paper and a pen. And I was a GTD zealot 8 years ago. My advice in my original comment was tailored towards people who plan on being upwardly mobile. If that's what you want to do, then personal finance is a waste of time. Ramit Sethi's advice is the best, chase big wins, automate your finances, and don't stress out over small repeated expenses. If you've hit a career plateau and don't see yourself making more money anytime soon, then by all means make the most of what you have. But c'mon, this is Hacker News. We can all be upwardly mobile here if we want to be.
duaneb 10y ago
This makes sense if you can move upward. Obviously not everyone can. For these people, this advice is toxic and life destroying.
- zo1 10y ago
  The vast majority of people can improve their prospective in life. At the very least they can be more efficient so they can spend more time with their kids; That way the kids have a better life than their parents. Though, to be fair, I think they should do both. Budgeting/finance is an incredibly important skill for all but the richest levels of society.
  - duaneb 10y ago
    Quality of life seems to increase monotonically in the states. The relative social status does not, on average. Considering happiness seems more based on the latter, this seems to be intractable.
    - softawre 10y ago
      Happiness is based on how well you are off compared to others? I mean, this is incredibly sad. But it's true, for some, I guess. This is why those who are making 15$/hour don't want the minimum wage to go to 15$/hour - even if they think they'll get a small bump to compensate.
prawn 10y ago
You're comparing life as a bootstrapper to a paid job more than life with accounting support of some sort to without. Further, there's no reason you can't do both. I don't account for my personal finances in any way, but I don't spend a lot on silly things. I do however use an app (http://streaksapp.com http://streaksapp.com) to push me. Without that, I'd be more inclined to take the easier or lazier options. We can account for our time and progress even if we don't do it for finances.
maaarghk 10y ago
You may have noticed that the article suggests using a tool, `hledger`, rather than creating your own accountancy software. Infact, based on your comment that you found the standard system isn't suited for the task, it's possible that your disdain for personal accounting comes from a lack of understanding of how to do it correctly.
tomrod 10y ago
I take the mechanistic approach to my personal finances, and treat them like business finances basically. It's a resource to be used, not a status symbol to be hoarded. Life has been wonderful as a result! I do keep a budget and keep track of things.
jimbokun 10y ago
Then don't work on an app for budgeting, just budget. You seem to think keeping a budget is some onerous, never ending task. In reality, probably spending about half an hour per paycheck is fine, once you have a system in place. And it certainly does not require a ton of technology, either. People budgeted just fine long before personal computers (lookup "envelope budgeting"). You are conflating two unrelated things. Spending a lot of time writing a budget app may have been a mistake. But you don't have to write your own app in order to budget.
- afarrell 10y ago
  Having spent a bunch of time with GnuCash, YNAB, and budgetsimple, I've given up trying to have a formal budget. Instead, my wife and I just spend 20 minutes every 2 weeks looking at our accounts and talking about any big expenses that we have coming up.
  - jldugger 10y ago
    I don't know that you're asking for it, but I'll share my approach. I use GNUCash for transaction recording, and I have two levels of budgeting: Level 1: next 30 days. I have a couple dozen recurring transactions, generated 90 days out. If, based on the current balance plus expenses 30 days out, my checking account is projected to go negative, I do something about it. Otherwise, I think about shifting some money into higher interest savings, since I don't need it in checking. And if savings exceeds my emergency fund definition, additional Roth IRA contributions may be in order. The end result is that reducing float in checking can end up with a pretty high return. Frequency: Once a month. Level 2: Annual Budget. At a high level, I use a simple spreadsheet to budget all income for the year into savings and expenses. It's complexity has grown over the past six years to calculate things like income taxes, so I can compare job offers in other locations and states. I also use it to verify my very high retirement savings rates are viable. Because more savings contributions -> less taxes -> more contributions etc., a spreadsheet lets me "solve" for maximal savings. It also lets me target expensive areas, like rent, or dropping cable, phone plans, etc. Frequency: Once a year.
- deleted 10y ago
  [deleted]

iamcreasy 10y ago

Would you please explain why this is absurd?

nommm-nommm 10y ago

Hacker news readers often live in a bubble that is well insulated from the outside world. A world where everyone is very smart and money and opportunities are a dime a dozen. Overspending is very easy for the average person. I know someone making 80,000/yr who has basically no assets and are living paycheck to paycheck and always complaining how poor she is. If you are living paycheck to paycheck on $50k you tend to live paycheck to paycheck on $100k. Adding additional income does not help these people - also see The Two Income Trap. Finding out where your money is going is good for everyone. Budgeting (even if informality) is good for everyone. Finding out where your money really goes is really eye opening for many. Realizing that a reduction in income probably requires a reduction in spending/lifestyle. Realizing you aren't "entitled" to the things you want by virtue of birth, you have to have the money to afford them. This may seem obvious to some but in the world of advertising and media it isn't to many. The criticism of personal finance or "frugality" here and in general comes in where people become obsessed with not spending money in the long term+. When every choice is optimized for spending less and one cannot enjoy anything with becoming guilty they are spending money. They put too much effort into pinching every penny and lose sight of the bigger picture. It's easy to hate on these people. This group is the loudest, unfortunately. Personal finance should be all about optimizing money for maximum enjoyment and financial stability. Realizing money is a scarce resource and optimizing it, which can include working on obtaining more depending on your situation. Budgeting in for the things you enjoy, within your means, and saying "no" to more things that won't bring you long term happiness. Realizing the difference between needs and wants. It's trivial to do this for many, and it is natural, but difficult for many as well. I think personal finance is just as much psychology as it is math. + Being obsessed with not spending money (OK, not obsessed but making it a priority) can be good in the short term for several month in some cases. Examples are taking a break from consumption or working to pay off high interest debt. Of course one should consider all their options in this situation - including, say, adding additional income short term if possible.

vinceguidry 10y ago
> Hacker news readers often live in a bubble that is well insulated from the outside world. A world where everyone is very smart and money and opportunities are a dime a dozen. I was speaking specifically for that audience and not for the broader one. Of course my way of dealing with money only works for people like me. I refer specifically to the "upwardly mobile", which is generally taken to mean those who make more than the average and are still capable of climbing the social ladder. When you are climbing the social ladder, you develop skills that make you more useful to people. When you learn accounting, you are learning a skill that will keep you from shooting yourself in the foot financially. It will not make you much more useful to others except in that regard. Sure you can get a job accounting, or use it to help run a business, but the benefits are too limited to justify doing it yourself. Hire somebody and use the time saved to learn something more useful. I never intended to say that people should not have a handle on their spending. Accounting / budgeting is one mindset that will give you such a handle but not the only one.

e15ctr0n 10y ago

Counting your pennies will not make your pennies grow. Only increasing your income will increase your income. This may seem like a radical idea at first, but look around you and you will find everyone understands this fundamental truth. Teenagers take summer jobs to earn extra pocket money. Housewives run home-based businesses on eBay / Amazon / Etsy to supplement the household income. People with full time jobs work part-time jobs before or after their main gig. Some people buy property and get rental income out of it. Those who are an authority on a given subject write books and earn royalty on book sales. The ultra-wealthy get dividend income from their stock market investments. None of these people belong in the HN bubble. Read any number of HN discussions on side-projects and you will see a wealth of ideas being put into action: https://hn.algolia.com/?query=sideprojects&sort=byPopularity&dateRange=pastYear&type=story https://hn.algolia.com/?query=sideprojects&sort=byPopularity... @vinceguidry is right. Invest in yourself and enjoy the payback in increased income.