Moving to a new home

For those of you have enjoyed my ramblings at this Blogger site, please visit me at my new blog site, titled "An Uncommon Way to Wealth". I wanted more than Blogger could offer, so I'm hosting a full-blown blog using WordPress.

Anyway, please follow me to my new home.

The power of accountability

I love to figure out how people achieve greatness. Just today, I gained a new insight into the mechanisms of superior achievement. In a word: Accountability.

Think about it: when there's nobody to call you on your lazy habits, and nobody to make you feel ashamed if you don't perform up to your standard, you don't perform as well (or at all). The Unknown Professor at Financial Rounds got me started thinking about this with this post about the power of accountability in writing. His advice:

1. Make it a daily habit, whatever it is. Don't let it pile up, thinking that you'll do it all at once, "later on".
2. Keep a consistent, daily record, and share your record weekly with somebody else.

Psychology has discovered that record keeping is a strong tool for directing focus. Accountability seems to magnify the effect by a significant factor (see Unknown Professor's post for details of the studies involved).

So, how does this adapt to personal finance? Keep a record of your finances. Make a budget, by yourself or with your spouse, and record income and expenditures every day. Track your progress, and at least once a week, share your progress with somebody else. I have seen a great deal of improvement in my finances when I am active about managing them, and discuss them frequently with my wife. You might see similar results.

YNAB and Yodlee update

Okay, so I did need a budget. Jesse Mecham at You Need A Budget was very helpful in resolving my problem with the YNAB Excel spreadsheet system. Apparently, the culprit was some clumsy-fingered doofus (me) who unprotected the spreadsheet and modified a formula or two by accident. Lesson learned: leave the protection on, and always make a backup before modification in the future.

If you check out the YNAB page, you'll get snippets of information about the creator of YNAB. He's in a Master of Accountancy program at BYU, has a wife and kids, and still manages to keep the inflow greater than the outgo, and maintain a budget at the same time. I'm currently working on a Bachelor of Science in Business Administration with an option in Accounting, and my spreadsheet skills are way too primitive to make something like YNAB, so thank goodness for those who have superior skills and knowledge.

(Disclaimer: I don't make money from sales of YNAB, so this is just a personal recommendation, not an advertisement.)

For those of you who haven't used Yodlee Oncenter, it's an amazing financial aggregator website that takes all of your bank accounts, bills, loans, etc., and combines them into one easily viewable page that you can update with one click. They've just updated their system to include a Historical Net Worth function. This lets you see the change in your net worth over the past weeks, months, and years. Yodlee is how I keep an eye on my finances. Check it out, and you'll love it.