GMR 123: Every Dollar - Does Dave Ramsey's Budgeting App Pass the Test?

Dave Ramsey has taught millions how to get out of debt and become financially free. He even has a budgeting app, Every Dollar to help people experience financial peace. In this episode of GMR, we test Every Dollar against the 4 Foundational Principles that should be part of every budget. Will it pass or fail the test?

Show Notes

 

The 4 Foundational Principles of a Budget

·       Assign Every Dollar

  • Zero Based Budget - Spend on Purpose

·       Arrange Every Expense

  • 7 to 9 Main Categories (housing)

  • Plus subcategories (rent, electricity, insurance, taxes)

·       Allocate It Evenly

  • Surplus & Deficits rollover 

  • Looks ahead - Future Forecasting

  • Annual view, not monthly.

·       Adjust As Necessary

  • Tracking expenses often to ensure success.

 

EveryDollar

 

Welcome! You are about to change your life!

Starts with a prompt to help you in your top goal for this season of life:

  • Pay off Debt

  • Save for retirement

  • Save for a house

  • Travel

  • Pay for kids college

  • Stop living paycheck to paycheck

You can click more than one.

Then more info:

  • Married

  • Kids

  • Homeowner vs renter

  • I have a car, I have pets

All this so it can automatically build out your first budget sample.

 

Premium Features

  • Connect to Bank

    • Pulls transactions

    • Drag and drop those transactions to categories

    • Check bank balance from the app

      • How to know if bank & budget balance agree in the way it’s set up

  • FPU Access - 9 video lessons free ($100 value)

 

Pros

  • Drag to track, it imports your expenses from your bank, and you can drag it over to each category of your budget. Which is friendly and easy to use. 

  • Each month you create a new budget, and it will copy over the categories and budgeted amounts.

  • Tracks you along the 7 Baby Steps - If you’re a Dave Ramsey fan, this is a cool motivator because the built-in life goals Dave Ramsey has can be helpful.

  • You CAN track from your credit card accounts. 

  • Mobile phones accessible.

  • If you don’t allocate all your money each month, it says you have more money left to allocate until you get it to zero, and then it says “It’s an EveryDollar Budget”. This celebrates your assigning of every dollar. Good motivation.

  • If you make a transfer from one account to another it doesn’t change your budget for the next month, which is very good. It allows you to move money one month without dramatically changing future months’ budgets.

 

Pro/Con

If you want balances to roll over, they have to be set up as “funds” this is the language of the software. Like a savings fund. You have to turn all your categories into funds to get them to roll over.

 Anything that you want to roll over month to month should be a fund.

  • Clothes

  • Haircuts

  • Car Maintenance

  • Savings Account

 

Cons

  • If you are manually entering and then it uploads from your bank, it double counts it, so you have to go back and manually delete one of the tracked expenses.

  • The bank account balance is connected to your budget tool. But it’s not intuitive to connect the two.

    • With YNAB - this information is available right in your budget window, the bank balance is connected.

  • You can’t see the whole year or multi-month view at one time.

  • You can’t have multiple budgets in one EveryDollar Account.

    • YNAB allows you to create unlimited accounts, you could have your business, your non-profit, and as many other budgets as you want to build and play with.

  • You can’t have multiple budgets in one EveryDollar Account.

    • YNAB allowed you to create unlimited accounts, you could have your business, your non-profit, and as many other budgets as you want to build and play with.

Resources

Budget Forms and Tools
David’s New Book - Jesus on Money
David’s New Website - www.stewardshippastors.com

BudgetingLeo SaboBudgeting Apps, Budgeting Software, Financial PlanComment