Why tracking apps mostly tell you what you already did wrong
Your envelope is going now — cash for groceries and eating out — and it's already doing more quiet work than you'd expect, just sitting there in your purse or your glove box.
So I'd like to take up something people ask me in nearly every class: why don't I simply use one of the apps? You know the ones. They link to your bank, sort your charges into tidy categories, and send you a cheerful colored chart at the end of the month.
My honest answer is this. I think most of them are close to useless for the thing you actually need, which is to stop the leak — not to describe it to you after it's already run down the drain.
What the apps are actually doing
An app that links to your account works in the past tense. The charge already happened. The money already left. Now it tells you, in a very friendly font, that you spent sixty-three dollars at Costco on a "quick run" for paper towels — the same shape as your forty-dollar milk run from a few lessons back, except this one arrives with a pie chart attached.
That's not nothing. It's just not what most people imagine it is. They believe that if they can only see the spending clearly enough, they'll somehow stop doing it. I've never once seen that work on its own. Seeing clearly is not the same as controlling. You can watch the water go down the drain in real time on a screen, and it's still going down the drain.
The cash envelope stops it while it's happening. When the envelope's empty, your hand simply can't pull more cash from it, because there isn't any more cash in it. That's the whole trick. It isn't a smarter system, it's a dumber one, on purpose — and dumber is what works when you're tired at the end of a long day and you just want to grab something on the way home.
The opinion, plainly
I'll say the thing straight out, since I've been circling it: I think apps that only track spending are mostly a report card for money you can't get back. A budget's job is to stop you before, not grade you after. If you want the app for the pretty chart, that's your business entirely. But please don't let it replace the envelope, because the chart has no bottom you can feel with your fingers.
How to actually use one, if you want it
I'm not about to tell you to throw your phone in the canal. Some of you enjoy the charts, and that's fine; tracking after the fact isn't worthless, it simply isn't the fix by itself. Here's where it earns its keep:
- Checking for errors. Think back to the copay lesson — this is the same instinct. Scroll through the linked transactions once a month and look for double charges, subscriptions you'd forgotten, that sort of thing. The app's eyes are better than yours at catching duplicates.
- Confirming your legal pad, not replacing it. At month's end, compare what the app says you spent in a changing category against what you wrote down. If they don't match, that's useful. Find out why.
- Seeing patterns over several months, if you're someone who likes a chart. Some of you are. I'm not, but I know some of you are.
What I won't do is tell you the app is your budget. Your budget is the legal pad and the envelope, made ahead of time, deciding on purpose what happens to the money before it happens. The app is only a mirror you check afterward to see whether your face is dirty. Useful — but it isn't the soap.
The choir thing
I sang in a few different choirs over the years, different wards, different directors, and there's one thing every single director said in some form: you can't fake your part. You can mumble along in a big group and get away with it for a phrase or two, but sooner or later the director stops the whole rehearsal and looks straight at your section, and everyone in the room knows exactly who was faking.
A budget is the same way. The tracking app is like standing in the back row, moving your mouth, hoping the sound from everyone else covers you. It feels like taking part. It isn't the same as knowing your part cold, which only comes from the tedious practice — the actual singing it through, wrong notes and all, until it's right.
The envelope is you singing your part. No one can fake that one for you, and no chart is going to sing it either.
Before next time
Look at whatever tracking app you have, if you have one, and this month use it only to check your legal pad numbers against it — not to decide anything on its own. See what it catches that you missed, and see what it can't tell you at all.