How do you manage your finances?

Assuming your income and assets are reasonably well funded, hire a hourly rate personal financial planner. Many finance books I've read failed to mention INSURANCE (life, disability, umbrella, etc.). In my view, insurance is paramount to secure your long term future.

If you are still starting out, here is the general guideline:

1. pay yourself (emergency fund first, then retirement funds (401K, IRA), after that, special funds such as wedding, down payment, etc.)

2. protect yourself (term life if you have kids, medical, rental or home owner insurance, etc.)

3. pay your debts (pay off debts with the highest interest rate first, that's usually credit cards, student loans, etc.)

4. pay it forward (sponsor some worthy causes. I do children international for 20 years now. Open source, etc.)

5. be frugal, but enjoy life (frugal is good, but sometimes, it's good to enjoy finer things every now and then)

6. the remaining money goes to portfolio focus on growth

Obviously there’s an infinite rabbit hole you can go down, but what I do is pretty straightforward.

Short term money: stored in a relatively normal checking account.

Mid term money: United States Treasury Bills. They typically beat bank interest, are just as safe (if not safer) as an FDIC bank account, and depending on where you live have a lower tax burden than regular bank interest.

Long term: Vanguard ETFs. I don’t have a ton of interest in spending hours every day trying to beat the market. I figure that as long as I can wait out bad economies, it’s better to invest in the total market than basically anything else. If you’re willing to hold onto the ETF longer than a year, typically the capital gains tax burden is lower than the income tax you’d pay in bank interest. Something like VOO or VTI are fairly low risk and since they’re not human-managed they have really low fees.

I am unemployed right now, but typically when I get a paycheck I immediately put 10%-15% of it into some form of the above savings, before I pay any bills. For psychological reasons I don’t really understand, if I pay my bills right away I never have any money left, but if I put 10%-15% aside immediately I still manage to pay my bills while also having savings.

I‘ve read a few dosen value investing books and would advise to read Richer, Wiser, Happier by William Green. It has a bit of a sketchy title but is actually a very good summary. The takeaway is: if you are as dedicated as these value investors and want to pick stocks then go and pick stocks, but for most people index funds are probably the way to go. The book also talks a bit about philanthropy.

Most importantly it talks about the mindset that you need for good financial planning. A very long-term and patient mindset. People who prefer to spend more than they own, for example, will not be suited for investing since they typically can’t wait long enough.

YNAB.

ynab.com - for power users only. If you don't actually care about tracking your money, don't bother.

Spend less than you make. Stack rank your expenses and optimize from the top down. Take advantage of 401k match. Volunteer your time and preferably your brain. Invest in index funds.

I am using firefly iii but recently testing actual budget. - https://www.firefly-iii.org/ - https://actualbudget.org/

Quite interesting self-hosted tools with overlapping features. Actual can also periodically sync with your bank to have your most recent transactions on the app. it works with read-only tokens.

Read widely online and find a financially-oriented community that matches your level of expertise and situation. Serendipity can play a major role. Stumbling across early on LEAP (i.e. long-term option) trading and later learning to navigate the complex world of closed end funds, helped me -- after many twists and turns -- realize a very comfortable existence. Ruthless self-awareness of one's limitations is useful. Expect to make many mistakes.

Everything flows into a spreadsheet I created that has a row for each month, and tracks my spending, income, and net worth. The data for each new row comes from a few different places.

Lunchmoney aggregates and categorizes my spending data.

My net worth is tracked in another spreadsheet that updates as asset prices change. This spreadsheet also tracks my asset allocation across my accounts, which is roughly based on the 3 fund portfolio from bogleheads (with a bit allocated to crypto as well) [0].

In terms of cashflow, I use Fidelity's cash management account, where I keep a buffer in a money market account. Income flows into this account, and bills flow out. They automatically liquidate the money market if I need more cash, which is nice.

And in terms of investing, historically I kept a 6 month emergency fund, then invested the extra every few months based on my desired asset allocation. More recently I have been increasing my cash cushion with the intent of paying off my recently purchased house in several years (since the interest rate makes it less attractive).

[0] https://www.bogleheads.org/wiki/Three-fund_portfolio

- Adaptive Asset Allocation and The Intelligent Asset Allocator

- Define what your long term goal is then work backward, doing the math

- Risk isn't the risk that you lose money, it's the risk that you won't reach your long-term goal. Everything you do should aim at the goal

- Prioritize your retirement fund over house and car expenses. Make monthly deposits into a high interest savings account for house and car maintenance. Withdraw when you use the balance. Always, always contribute to your retirement fund.

- Save for insurance payments through the year in a high interest savings account, pay a lump sum at the end of the year. This way you earn, and don't pay interest.

- With investing you probably want a robo investor, and adaptive asset allocation is the way to go

After a few years managing my finance after learning that I should do it (review of my first year of full time work), what I retain is two things: Envelope budgeting, Every dollar is used, and don’t sweat the small stuff. I have an envelope for each category of spending, each goal and one for saving. My income is split between these everytime I get it. I don’t bother tracking small expenses (less than 10$) if it’s not done automatically (credit card). I used Ynab first, then banktivity, now I use Ledger.

My goal is only to track If I’m not spending more than necessary and my runway if I have no income.

Lunch Money is a beautiful little independent app for personal finances: https://lunchmoney.app/

Won't do lots of complex stuff like investment strategy and estate planning, but covers all the essentials for a personal / family budget.

Gives you a good overview of your spending, net worth over time, and lots of charts and querying functionality. Made a big difference for me. Before I was spread across a bunch of Google sheets that I rarely updated.

I check my bank account every week or so. If it's above 0, I consider it a win.

Wish I was kidding :/

I tried YNAB and it was too cumbersome. If I were to try again, I'd go for some low-tech Exel option.

I don't. I just wing it month-to-month and hate every second of it.

For personal finances, I use Microsoft Money 2004 edition, running in a windows 2000 VM. Once a month or so I go in and add all my transactions. I don't actually use it for anything, though. Spend less than you make and the rest solves itself.

Not that I’m particularly good at this myself… but it is our mission at yeekatee[^1] to help people manage their finances and invest wisely, in the long term.

Right now we offer a rather good portfolio aggregation, either via manual or automated syncing (read scraping… alas, the state of financial technology…). From basic to rather advanced figures, a lot of explanations. Market data, news, and dividends.

And finally a social network to discuss and learn with like minded folks. We wanted to do a proper Show HN in a few days actually, but I thought I’d leave it here as you could find it useful!

[^1]: https://yeekatee.com/

It’s as conplex as you want it to be.

My household has a high savings rate, around 50-60%, so I don’t actively monitor anything monthly. A few times a year I will dump excess savings into retirement, college funds, etc.

I Will Teach You to Be Rich Book by Ramit Sethi, is a good place to start. He has lots of great free content on YouTube you can check that out first and decide if you wanna give the book a try.

I'm using Capitally (https://mycapitally.com) which I started building to replace my 3 spreadsheets that needed constant attention and broken down quite often. It now completely covers tracking my investments - spreadsheet nr 1, still two to go - portfolio strategy and budgeting.

This is not financial advice but here’s what I do:

High level - "Earn, Save, Invest"

In order for your money to make more money you need to execute all three steps: Figure out how to make money, manage not to spend it, and produce a return from that money.

Try to optimize each step. Make more money if you can / are comfortable (deserve a raise? change companies/jobs? start a side hustle?). Spend less (make and live by a budget, cook your own food, buy used, get cheap hobbies, stop keeping up with the Joneses). Understand the tax efficiency, risks, potential returns, and effort required from different types of investments.

I take credit for none of the ideas above, they are cobbled together from various online sources. Some things to search / places to start: Reddit personal finance flowchart, The Millionaire Next Door, Index / Boglehead investing.

Treat everything as if it were a bill. My wife and I started to treat savings and investment as a bill and it has changed our psychology a lot, especially the mindset of "Ehhh don't need it. We can spend it." to "We have to pay this bill!"

I read "Rich Dad Poor Dad" and follow the advise. It works.

I spend much much less what I make (maximum 35%). So every month I save at least 2 more months of living. Over the past 3 years doing it regularly I have enough saved for some 10 years.

Utilizing Personal Capital and tracking every penny I spend.

I use finary, I can monitor in one app my finances

MoneyStats

Poorly.

Wait, you guys manage your finances?