When I was a kid, we used to sled down old Cemetery Hill.
It was, as the name suggests, a hill at the local cemetery. We didn’t have to dodge tombstones or anything but we DID have to watch out for the forest at the bottom of the hill. One day, my friends and I had an idea after having watched National Lampoon’s Christmas Vacation. We had one of those round metal discs… and some cooking oil and… we decided to polish the bottom of this disc and take turns.
And so we did.
We buffed and buffed and buffed and… got the bottom of that thing to shiiiiiiiiiiiiiiiiine.
You wanna know something?
Obviously not like the movie, but we still zipped down that hill lickety-split. Pro tip: do NOT go downhill on your stomach if you decide to try this. You will get a mouthful of snow the first bump you hit and then… you will spin around in circles uncontrollably shooting snow out your mouth like one of those mechanical snow-making machines you see at ski resorts… until you wipe out or roll into a tree or something.
Anyway… we learned something valuable.
Speaking of which, something I see a lot of people doing these days is trying to do the equivalent of buffing those little metal saucer disc thingies when it comes to their budget. I’m referring to these Fintech startups that design budgeting apps where you don’t have to think about anything. It hooks up to your bank account and supposedly does all the budgeting stuff behind the scenes for you.
Except… it doesn’t really do any budgeting stuff at all. It basically scrapes all your bank transaction data and reposts it inside this cute little app. Then, the app manipulates the data to do a bunch of whiz-bang stuff. I guess people are into that sort of thing. Which is fine, except… they’re still not budgeting. They’re rearranging expenses to see where money is going, doing pointless categorization of expenses, maybe seeing a “safe to spend” amount, or maybe (maybe) able to push money around inside of their bank account to pay bills or whatever. In some cases, the app does some version of the envelope method of budgeting, but in a lot of these apps, even that don’t work too well.
End result is… the user is going way too fast down the hill, trying to automate everything so they don’t have to think about their money, and they don’t really realize what’s going on with their money until they smack into a tree. Then, it hits them. They wasted a lot of time trying to “gamify” their finances, ignore them, play cute little games or whatever, and didn’t really accomplish anything meaningful.
Meanwhile, the app got all the user’s data, sold it for money, and the end user got nothing of substantial long-term value. No budget. No real insights that couldn’t be gleaned from their bank statement and a simple excel spreadsheet. And, no long-term plan of any kind.
I mean, really. Where do I sign up?
In my heretical opinion, people would give themselves an incredible advantage in this area of their lives if they just slowed down, ditched the app, wrote everything down by hand, and maybe, just maybe… thought about their money more often.