If you are ready to budget, you're ready to actually put your income and expenses down where you can see them and simplify them. Customize it. What do you use? What do you use? Do you use an app? Do you use a spreadsheet? Do you use a different method altogether? In this blog, we're going to be talking about whether or not you should be using an app or a spreadsheet for budgeting. Which one is better? I'm going to help you decide in this blog.
Spreadsheet Vs App
A budget spreadsheet is just something that you can put together either in Excel or using Google Sheets. Or maybe you're using Apple, what's the apple equivalent to Microsoft Excel, numbers, numbers? That's right, are you using numbers, it doesn't matter. If however, you want to create your spreadsheet, there are a few pros and cons that you should consider.
Let's go over the pros. The biggest pro to using a spreadsheet is that it's customizable. You can make it however it works for your brain, you can create really elaborate math formulas to help you figure out percentages and different things adding up the transactions inside of your budget. And you can customize how granular that budget gets.
You can also make it very vague as well, you can just use subcategories and say these are all of my fixed categories. And these are all my fun spending categories. And we're just going to do fixed and fun done. Now another pro that I like about spreadsheets is that it forces you to feel each transaction, even though you may be transacting and purchasing digitally, you have to manually input those transactions into your budget spreadsheet, which forces you to actually see how often you've been going out to restaurants, or how often you've been hitting up Amazon and adding to cart, I think that's a really valuable way, especially in the beginning to just see and feel have that emotional attachment to your spending again, because so often, you know, working in a digital age, and we grew up with cell phones in our hands. And now it's so easy to just use a cell phone to spend on things, it kind of detaches us from that spending. So with a spreadsheet, it forces you to feel those transactions because you are manually entering them.
Another pro that I like about spreadsheets is that you can easily forecast and customize your budget for the next month. So I can simply just take a duplicate of the month before in my spreadsheet and duplicate that for the next month and then change it based off of what's happening for that month, we are quickly getting into the holiday season. And so I find that I need to change my budget for November and December. Or maybe there's a month in the summer for you that have a ton of birthdays, and anniversaries, maybe the Fourth of July gets thrown in there and you have a big party. And maybe you really need to adjust your budget to accommodate those things. That's what I like about the budget spreadsheet is that you can easily forecast and change things for the following month.
Now, there are two big cons here with this spreadsheet that are not lost on me when I really talk about spreadsheets and that is you have to track down your transactions from multiple accounts. So not only do you have to record things that happen inside of your checking account, but also your savings account, your credit card account, your investment account, your other investing account, your 401 K account, you get it and the list goes on and on. And so that brings me to the second con, it's time-consuming, it can be very time-consuming to track down all of these transactions and input it into your budget.
Okay, now let's get into the app's pros and cons of this whole debate. And let's see if an app is really truly worth it. Okay, I think the biggest pro is that you can manage your time better because the app imports transactions automatically into your dashboard. So you don't have to do it manually. Also, it shows how much is left in your budget in real time. Plus, you can access it on the go. So if you are budgeting for the first time, this might be a good idea to use an app so that you can look up okay, I only have $150 left in my restaurant spending and we still have three weeks left of the month, I really need to tone it back. So it can really help you in real-time access it on the go see what's ahead and see how you can change your spending behavior in the moment. But with everything, there are a couple of cons that I want to mention.
I think the biggest one that can be kind of time-consuming is that sometimes the transactions aren't automatically categorized correctly. So then you do have to spend some time re-categorizing things, especially with how things work best for your brain. So it's a good idea to look for an app that once you set it to the right category, can retroactively apply it to previous transactions and moving forward also categorizes it as the same category so that you don't have to continue doing that activity again, and again, a big con for me with using an app. And is one of the reasons why I really haven't used an app as my primary method for budgeting is because you don't really feel those transactions, you don't really feel those transactions. Because there's still some separation from your spending. Yes, it's on your app. But if you're not actively looking at your app, and actively going through each transaction and reconciling those transactions, then I feel like you're not really making headway on your spending.
Maybe that's just me, tell me in the comments below. If an app has truly helped you feel your transactions and have an emotional connection to it because that is the thing, money is emotional money can make us happy, it can make us resentful. It can make us feel guilty, and it can make us feel so many different things. And I think there needs to be some emotional attachment to your transactions. Otherwise, we won't know how to move forward in a positive direction and develop in our financial journey. Also, another thing that I found with most apps, maybe not all of the budgeting apps is that I can't really forecast for the next month ahead of time until I'm in that specific month. In other words, I can only see what's going on in the month that I'm in and I can't forecast and change my budget for the next month. Maybe there are some budgeting apps that allow you to do that. But I just haven't come across one that gives you that customization ahead of time.
Conclusion
Okay, so we've talked about the pros and cons of using a spreadsheet and an app. But I want to tell you about a really cool budgeting method that you can use. And that's through a hybrid model. So you would use a spreadsheet and an app to make things more seamless in your life. Now, what I would do this for, and what I've kind of been doing lately is I can use the app on the go and use it for high-level spending. So something like simplifies by Quicken. I'm used to looking at high-level shopping so I can see Whoa, I've actually a lot of shopping transactions go going on. And then I can use my spreadsheet to look at it on a more granular level by looking at my transactions and then adding it to my budget spreadsheet and kind of using both simultaneously. I also like using that app as a reminder for my savings goals, and then using the spreadsheet to really see how much money I have that I can pull from IE my sinking funds pull from to use and spent and so I'm kind of using this with my Christmas gifts sinking fund, and then I can see exactly how much I have in that sinking fund and then subtracting from that so that I can spend in real time I think it's a great way to use as a hybrid model. If you're a money nerd, you may really go for this type of thing. If you're not so much into tracking finances, I will stick with one or the other. Tell me in the comments below. Are you an app lover? Or are you a spreadsheet lover? Tell me below
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